In the bustling city of Vancouver, B.C., a startup named Hiive has caught the spotlight by securing a cool $4.2 million for its innovative marketplace. Hiive isn’t your typical marketplace—it’s a place where stakeholders can trade shares of private tech ventures in the secondary market.
Though it was only established in 2021, Hiive isn’t one to wait around. The company has set its sights on maximizing the potential of the private markets. They’ve streamlined the process of trading private shares, introducing automation for a smoother experience. But it’s not just about convenience. Hiive prides itself on delivering precise, up-to-the-minute valuations for mature startups. This is achieved by sourcing bid, ask, or trade prices directly from verified participants on the platform, echoing the valuation techniques of the public markets.
It’s an interesting time for ventures like Hiive. Notably, numerous tech heavyweights are choosing to remain private for extended periods, especially given the current tech market’s cautious pace. This shift has generated a spike in demand as investors and company employees seek platforms to cash out their shares.
A keen supporter of Hiive, Renaud Laplanche, who once helmed Lending Club, remarked, “With the unpredictability of the IPO markets and the choice many companies are making to remain private, there’s an upsurge in secondary sellers. A lot of funds are diving into this secondary buying spree.”
Hiive isn’t just a transactional space. It offers users a glimpse into the ebb and flow of a private company’s share value, akin to public stocks. The numbers certainly are promising. Recent data shows the platform houses open offerings valued at approximately $1.9 billion. This includes active listings from over 570 firms, like renowned names such as Outreach, Icertis, and Convoy. Moreover, Hiive boasts an impressive user base with more than 12,000 users, of which over 1,000 are institutional entities.
The company’s growth trajectory is commendable. As of last month, Hiive celebrated 170 trades, marking a six-fold growth in both transaction rates and volume over the previous year. The marketplace, however, isn’t without competition, with platforms like EquityZen and Birel also in the fray.
So, how does Hiive sustain itself? Their revenue model is straightforward. For every transaction facilitated, they charge a fixed amount and a commission.
The brains behind Hiive include CEO Sim Desai, who, before this venture, served as a managing director at the Toronto-based investment bank, Setter Capital. Hiive is actually an offshoot of Setter Capital. Alongside Desai, the co-founding team comprises Prab Rattan, Stuart Eccles, and Sarah Huggins. In terms of growth, the company has expanded its workforce from an initial six in early 2022 to a robust 45 currently.
Backing Hiive’s recent funding spree were notable names like Uncorrelated Ventures, Splash Capital, Harmony Venture Partners, Hack VC, Agmen Capital, and, of course, Laplanche. Post this round, the startup’s valuation stands at a noteworthy $77 million.
