Lucaria · Products · Pre-IPO Share Financing
Sized to the positionPre-IPO Share Financing
Liquidity against concentrated pre-IPO equity — held through the entities you already use — without selling the position, triggering a taxable event, or waiting for an exit window someone else controls.
Who it’s for
- Founders and early employees with concentrated positions and a business that needs capital now.
- Early investors and funds seeking liquidity without a secondary sale at a discount.
- Holders whose shares carry transfer restrictions that seem to rule financing out — they usually don’t.
Why Lucaria
- Borrowing is not a sale: no capital-gains event today, and QSBS treatment stays intact.
- Non-recourse structures are available — if the exit never comes, the shares answer for the loan, not the rest of the balance sheet.
- Handled with discretion, consistent with your company’s policies.
How we structure it
Structured around the restriction, not against it
Three structures cover nearly every situation, and the right one is dictated by your company’s transfer rules — sizing depends on the issuer, the stage, and those restrictions.
- Direct financing where transfer is permitted — the quickest, cleanest path
- SPV structures that hold the position while you keep the economics
- Hypothecation when transfer is restricted — the shares never change hands
- Non-recourse available by design — lower advance, higher cost, and we say both out loud
The honest read
Why banks say no — and why that isn’t the end
- Banks can’t underwrite private stock — no public price, no box to put it in.
- Issuer transfer restrictions and rights of first refusal stop most lenders before the first call.
- The trading platforms want you to sell; selling is precisely what a financing avoids.
Common questions
Pre-IPO Share Financing, answered straight.
- My shares have transfer restrictions — is financing even possible?
- Often, yes. Where transfer is restricted, hypothecation structures pledge the economic value without the shares changing hands, and SPV structures solve other cases. The company’s rules shape the structure; they rarely end the conversation.
- How is this different from selling on a secondary market?
- A sale is permanent: the upside is gone, a taxable gain is triggered, and the price is usually discounted. A financing keeps the position, defers any tax event, and preserves QSBS treatment where it applies. We coordinate the comparison with your tax counsel.
- What does non-recourse mean here?
- If the exit never comes, the lender’s remedy is the shares — not the rest of the balance sheet. That protection is priced in: non-recourse structures carry lower advances and higher cost, by design, and we say so plainly.
- How large can the facility be?
- It is sized to the position — the issuer, the stage, and the transfer restrictions drive it. We publish no rate card here because an honest number requires a diagnosis, and we give you that honestly after one conversation.
- Will my company find out?
- These transactions are handled with discretion and structured to be consistent with your company’s policies. Some structures require issuer cooperation and some do not — we tell you which is which before anything is signed.
- Why is this a business loan?
- The shares are held through entities — LLCs, trusts, holding companies — and the proceeds serve business and investment purposes. This is commercial credit against an investment position — never financing for personal, family, or household use.
No obligation
Tell us what you need.
No credit pull to start. We’ll show you the honest options for pre-ipo share financing — and if borrowing isn’t the answer, we’ll say so.