Quantfury Gazette


Delivering an Even Playing Field


The average investor is truly up against it. Honestly, everything is staked in the favour of big rollers. It’s ridiculous, really.

Even the language used to distinguish between different types of investors serves as a gatekeeping exercise. I mean, what’s a “retail investor,” but just someone who has less money than the so-called “institutional traders?”

But the thing about gatekeeping is that it works. The arbitrary rules that have been put in place serve as an effective way to separate “them” from the “us.”

Take IPOs. Except you can’t take one because you are highly unlikely to be offered the chance to buy into them. Most offerings are restricted to the highest rollers. It creates a rich get richer situation as most IPOs see a more than a 10 percent gain in their first day of trading.

It’s easy money. If you have money.

It’s not fair and it’s not going to change overnight, but I see hope that there might be a movement of young investors – investors like you – that aren’t willing to accept the status quo anymore and are going to demand that they be given an equal share.

We saw this play out a bit when investors manipulated GameStop. That was high profile and a fun media story that amused and confused for a few days, but ultimately didn’t change much in terms of the power dynamic. Sure a few people made some money and a few others lost some, but taken alone it was more of an annoyance to the industry than it was any seminal change. 

GameStop is a story, but it’s not really the story.  

To find the story you have to look deeper. There what you’ll find is average investors starting to figure out that they have more power than they realized. Maybe not to manipulate a stock in dramatic fashion every month, but certainly to make the larger business world take more notice.

You can see evidence of just that in the London IPO offering for the food delivery service Deliveroo. With it, many big players are balking at a $13-bilillion USD valuation.

Perhaps to offset the negativity around the company – it hasn’t turned a profit yet and doesn’t really have a differentiator from other delivery companies that are already on the market and more established – Deliveroo has decided to make a direct plea to its customers.

Not to order food, but rather to buy its stock. They are offering $86m of the stock to average users. They even included the offer in an email blast to users, right beside the 10% off the next pizza order deals.    

When you’re looking for $13-billion, $86-million is peanuts, really, but by offering the stock to people that normally wouldn’t get a shot at an IPO they are generating significant buzz. That buzz will very likely help them find the investment that they are looking for, from a previously reluctant market.

It’s smart and it speaks to the need of companies to work to be appealing to investors in a tangible, real world way. By, engaging users of their service directly they have created a bond with their investors that will be worth far more than the $86-million.

Money is always going to talk and the high rollers are always going to have an advantage, but it’s little things like this that show that you and I have a role too. We just need to keep demanding to be heard.  


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