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REVIEW: Bid for IPO’s with OnMarket Bookbuilds

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OnMarket Bookbuilds is an emerging Aussie fintech company that enables all investors large and small to bid for new and upcoming IPO’s on the ASX.

OnMarket Bookbuild

Here is how OnMarket Bookbuilds works and how you can use the platform to start investing in the latest IPO offerings in Australia.

This is NOT a product endorsement, recommendation or statement of opinion, this blog is operational review based on the facts that are available at the time of writing, intended to inform and entertain – please read it as such

What is an IPO?

IPO stands for, Initial Public Offering and as the name suggest this is the first time shares in a private company have been offered to the public for investment.

Example: Google (now Alphabet) IPO’d in 2004 for $85 / share

Google logo

Google Share Price

Of course not all IPOs will do as well as Google, but you get the point.

 

Read more about IPOs here:

Access to IPOs

The IPO process is typically managed by investment banks and stockbrokers, who prepare the private company to become a listed company on the stock exchange.

The investment banks and stockbrokers leading the IPO would have first dibs at offering the shares to their best clients.

If an IPO was considered highly sort after, such as Google or Facebook, often all the shares would be allocated to existing clients and none for other investors. That was until now.

Enter: OnMarket BookbuildsOnMarket Bookbuild

OnMarket Bookbuilds is an Australian fintech company that started in 2015 with the following mission:

Our mission is to build and leverage technologies to empower investors and companies by making the capital market fairer, more efficient, and more transparent.

1. How Does it Work?

OnMarket Bookbuilds is the world’s first free-access portal into capital raisings and IPOs.

The first step is to open your FREE account:

OnMarket Bookbuild - Join

2. The Portal

One you login you will see that there is a list of live offers:

OnMarket Bookbuild - Live Offers

If you see one that is off interest to you, you can click for more info, or go directly to Bid.

3. The Bidding Process

If you are interested in making a Bid, you will be taken to a screen showing a link to the Prospectus.

The Prospectus is the formal IPO document and outlines all the information required to help investors make an informed decision about the shares they are buying.

It is strongly recommended that you read the Prospectus in full and be familiar with what you are investing in.

OnMarket Bookbuild - Bid

If you are happy with the information in the prospectus and wish to proceed with the bid, simply enter you bid amount and apply:

OnMarket Bookbuild - Bid 2

4. Past IPO Performance

We know that past performance is not a reliable indicator of future performance and IPO’s can go down as well as up, but at least you know OnMarket has been able to offer some profitable IPOs to members:

OnMarket Bookbuild - Track Record

FAQs

Here are some frequently asked questions about the service:

Q: Will I Get What I Bid For?

A: Not always. The company that is listing has ultimate say over the allocation of their shares.

If a IPO is particularly sort after, then it classes as ”oversubscribed”, which means there were far more bids then there were shares available. In this case you may only be allocated a portion of shares you bid for (if at all).

On the flip side, if there is not enough demand from investors, the IPO is said to be ”undersubscribed” and if the company cannot find more investors they may have to cancel the IPO and refund your money.

Q: When Do I Have to Pay?

A: Using OnMarket you can bid now and pay later.

The prospectus will outline the key dates for the IPO and OnMarket will inform you when you need to transfer funds to ensure your bid is ”live”.

You can easily transfer funds using BPAY.

Q: How Do I Get My IPO Shares?

A: Via your HIN number. If you were successful in your bid for IPO shares, you will be allocated the shares via the ASX CHESS system.

Under the CHESS system, each investor with an active broking account is issued a Holder Identification Number or HIN.

IPO shares will be allocated directly to the broking account associated with your HIN before the shares start trading on the ASX.

HIN

Q: Can I Cancel my Bid?

A: Yes. Using OnMarket it is possible to cancel your bid.

Sometimes the IPO process may take longer than expected, or new information becomes available and you decide the IPO is no longer for you.

Simply click the bid history tab and elect to cancel your bid. Your funds will be refunded into your account within a couple of days.

OnMarket Bookbuild - Bid History

You can view a complete list of upcoming IPOs and the performance of past IPOs at:

Logo

Summary

  • An IPO is when a company first sells their shares to the public and lists on the stock exchange;
  • OnMarket Bookbuilds allows all investors to bid into new IPOs on the ASX.
  • You should always review the prospectus documents before investing
This blog provides links to third party sites, aimed at helping you gather the information required to make an informed decision – we may receive payment of a commission or other fee for these referrals.

 The Wealth Guy Signature
The information on this blog and website is of a general nature only. It does not take into account your individual financial situation, objectives or needs. You should consider your own financial position and requirements before making a decision. We recommend you consult a licensed financial adviser in order to assist you with this. This blog provides links to third party sites, aimed at helping you gather the information required to make an informed decision – we may receive payment of a commission or other fee for these referrals.

 

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