Blackrock and Bitcoin logo on dark background with shiny details. 3D render. MUENSTER, GERMANY - June 17, 2023
- Scalable Capital, in partnership with BlackRock, is democratizing access to private equity by allowing retail investors in Germany to invest in non-public companies through the Scalable Broker with a minimum investment of 10,000 euros.
- This initiative offers a flexible, open-end fund structure, seamless digital integration, and the potential for high long-term returns, making private equity more accessible than ever.
Scalable Capital is setting a new precedent in the investment world by giving retail investors access to private equity—an asset class once reserved for professionals. This move, in partnership with BlackRock, marks a significant expansion of investment opportunities available through Scalable Capital’s digital platform.
Bringing Private Equity to the Public
Traditionally, private equity investments have been the domain of institutional and high-net-worth investors due to high entry barriers and complex fund structures. However, Scalable Capital’s new initiative changes this landscape by allowing individual investors in Germany to participate in private equity via the Scalable Broker. This is a major step toward democratizing access to high-potential, non-public companies.
To kick off this offering, Scalable Capital is partnering with BlackRock, a global leader in private market investments. Investors can now gain exposure to the BlackRock Private Equity Fund with a minimum one-time investment of 10,000 euros, which can also be structured within a savings plan. Notably, there are no front-end loads, making this an even more attractive opportunity.
A Growing Market with High Potential
Private equity presents a lucrative opportunity for long-term investors. Over 88% of companies worldwide with revenues exceeding $100 million are privately held, meaning most of the market’s value exists outside stock exchanges. Europe has seen a notable trend where listed companies are declining, while private enterprises are on the rise. In Germany, an astounding 98% of companies with revenues above 100 million euros are privately owned.
The appeal of private equity investments lies in their historically high returns. Over the past 20 years, private equity has delivered an average annual growth rate of 14.9%, surpassing the returns of traditional stock indices like the MSCI World Index. Moreover, integrating private equity into a standard portfolio can significantly enhance returns while only marginally increasing risk.
A Smarter, More Flexible Fund Structure
Unlike many conventional private equity funds that require long lock-in periods, the BlackRock Private Equity Fund is structured as an open-end fund. Investors can redeem shares after two years, with quarterly opportunities for withdrawal thereafter. This flexibility makes private equity more accessible than ever before. Additionally, Scalable Capital ensures that investors undergo a digital suitability check to confirm their risk tolerance before committing to long-term investments.
Seamless Integration into Scalable Broker
The new private equity offering will be fully integrated into the Scalable Broker, allowing investors to manage their portfolios through a single, user-friendly platform. The process is entirely digital, removing the need for paperwork and manual processes. Investors will also benefit from features such as automatic capital gains offsetting and exemption orders.
A New Era for Private Investing
Scalable Capital’s expansion into private equity represents a game-changer for investors looking to diversify their portfolios. With BlackRock’s expertise and Scalable Capital’s seamless digital platform, retail investors now have the opportunity to tap into a market segment that was previously beyond reach. As private companies continue to drive economic growth, this new offering provides a timely and valuable investment opportunity for those with a long-term perspective.
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