Late-stage, venture-backed tech companies significantly outperformed the
S&P 500 and Dow Jones Technology Index in the fourth quarter of 2018,
according to the SharesPost
U.S. Private Growth Index.
The Index, composed of 106 companies, rose 10.9% in the fourth quarter
from the third quarter of 2018. The S&P 500 fell 14.3% in the fourth
quarter, and the Dow Jones U.S. Technology Index declined 17.9% from the
third quarter of 2018.
Preliminary data for the first quarter of 2019 indicate that the
SharesPost Index has increased 11% compared to a 4.2% gain in the S&P
500 and a 12.4% rise in the Dow Jones U.S. Technology Index.
“The late-stage, venture-backed asset class rose by double-digits in the
fourth quarter, while the key benchmarks declined by double-digits,”
said Alejandro Ortiz, Research Analyst at SharesPost, Inc. “This wide
variance in performance and the uncorrelated, double-digit returns are a
reason capital is flowing into this asset class.”
The performance of the SharesPost Index benefitted from strong primary
funding rounds completed by Index components Instacart, Chargepoint,
Coinbase, Auris Health, Netskope, InVision, and Snowflake. On average,
the valuation of companies that completed a primary funding round in the
fourth quarter jumped by 148%.
Historic Performance of Index
Since its launch on Jan. 1, 2017, the SharesPost Index has increased
68.18% percent through December 31, 2018. By comparison, the S&P 500 has
increased 11.97% and the Dow Jones U.S. Technology Index has increased
32.87% during the same period.
For all of 2018, the SharesPost Index increased 41.9%. By comparison,
both the S&P 500 and the Dow Jones U.S. Technology Index decreased by
6.2% and 1.9% respectively.
On a cumulative basis, from January 1, 2015 to June 30, 2018, the
SharesPost index increased approximately 188.1%; the S&P 500 rose 21.8%
and the Dow Jones index increased 53.4 percent.
About the SharesPost U.S. Private Growth Index
Each quarter, the Index states the percentage gain or loss in valuation
for the companies included in the Index. The Index is currently composed
of U.S.-based private growth companies in multiple tech sectors,
including Consumer Internet, Enterprise Software, Energy, Healthcare and
Financial Services.
The Index’s numerical value is based on a formula developed by
SharesPost Research LLC, a wholly owned subsidiary of SharesPost, Inc.
The Index relies on data from SharesPost Financial Corporation’s
secondary transactions, the Index companies’ primary funding rounds and
publicly available valuation marks, including the holdings of 73
publicly reporting mutual funds. For complete list of Index companies,
as well as disclosures and methodology, please visit The
SharesPost Private Growth Index.
About SharesPost, Inc.
Through its subsidiaries and affiliates, SharesPost, Inc. (collectively,
“SharesPost”) operates a FINRA-registered broker-dealer, SEC-registered
alternative trading system (ATS) and registered investment advisor.
SharesPost helped launch the secondary market for private tech companies
in 2009 and has built the leading platform for secondary transactions
and digital securities. SharesPost provides the private tech asset class
with a suite of trading solutions to facilitate shareholder and option
holder liquidity. With nearly $5 billion in secondary market
transactions in the shares of more than 250 leading technology
companies, SharesPost provides the trading, research and online tools to buy
and sell pre-IPO stock with confidence. SharesPost has trading
operations with licensed brokers in San Francisco, New York City and
Singapore.
For more information, visit sharespost.com.
Any securities offered are offered by SharesPost Financial Corporation,
a member of FINRA/SIPC. SharesPost Financial Corporation and SP
Investments Management, LLC, a registered investment adviser, are wholly
owned subsidiaries of SharesPost Inc. Certain affiliates of these
entities may act as principals in such transactions.
Investing in private company securities is appropriate only for those
investors who can tolerate a high degree of risk and do not require a
liquid investment.
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