CircleUP, the equity crowdfunding platform that targets consumer facing companies in the US, has launched a secondary market for shareholders to trade shares in companies that use the platform to raise money. Details include: The opportunity to sell shares 1 year after investing; getting data rights to company performance and buy shares in companies before they are actively raising.
Companies that choose to enable secondary selling will indicate that status when they're raising capital on the site. Information transfer rights will be included with those shares, so secondary buyers will be able to see the available financial details before deciding to invest. About 15 to 20 companies are set to start using the new service this week. In its initial form, the CircleUp secondary market will not apply to employee shares, but it's something that could be added in the future. For venture-backed start-ups, companies like SecondMarket and SharesPost (through a joint venture with Nasdaq) have built technology to simplify the secondary process for employees and early investors.