Private shareholders in the UK are experiencing “mass frustration” due to a lack of communication and transparency from the businesses they have invested in, according to new research.
A survey conducted by peer-to-peer lending platform Asset Match has found that there is a widespread feeling of discontent being experienced by the nation’s community of private company shareholders. 10 percent of UK shareholders said they have never been given the opportunity to discuss options regarding their shares since making their original investment, with a further 9 percent feeling ‘locked-in’ due to an inability to sell or trade the shares they own in a private company.
Regarding Brexit, the sentiment of investors is largely positive – echoing the results of recent surveys conducted by investors in the wake of the UK’s decision to leave the European Union.
The survey did find that there was a high level of confidence in the stock markets, with 23 percent of investors intending to put money into this area rather property, at 11 percent, and commodities at 7 percent.
However, whilst investors are keen to put money into the stock market, once the money is there investors are uncertain as to how long to leave it or when is the right time to sell. 27 percent of respondents – the equivalent of 1.8 million shareholders across the UK – do not know the current value of the shares they own, and more than a million shareholders would like to invest in other high-growth businesses but cannot because of an inability to sell their existing shares.
Stuart Lucas, Co-CEO of Asset Match, commented on the findings:
“Demand among investors to buy shares in Britain’s exciting high-growth businesses is rising all the time, particularly as alternative finance, angel investment and crowdfunding become more prominent. However, this research uncovers a concerning problem being experienced by those who have already invested in these companies – namely, shareholders are too often ignored and pushed to one side.
“There are huge numbers of shareholders in the UK who want to sell their shares but cannot, don’t know how much their shares are actually worth, or wish to invest in other companies but are trapped in their current investments. Failure to address this issue will not only breed further discontent within Britain’s shareholder community, but also risks stunting the long-term growth of the private sector by not enabling investors to sell shares and re-invest in the next generation of scaling companies.”