Clear Street Databricks pre-IPO platform aims at private-market demand

Clear Street Databricks pre-IPO access is set to be the first offering on a new private-company investing platform from the fintech broker, CNBC reported. For individual investors who qualify, the move matters because more of the gains in high-growth tech companies can happen before shares ever trade on a public exchange.

CNBC reported that Clear Street is close to announcing a platform for accredited investors to buy interests in late-stage private companies, beginning with Databricks. Databricks, an AI software company, was valued this month at $188 billion, according to a company press release cited by CNBC.

Accredited investors are investors who meet regulatory requirements to access certain private investments. These deals can carry different risks than public stocks because private companies disclose less information, trade less often and are harder to value in real time.

How can investors get Databricks pre-IPO access?

Clear Street’s planned platform would let eligible investors buy exposure to Databricks before a potential public listing, according to CNBC. Pre-IPO access means buying an interest in a company while it is still private, before its shares are listed on a stock exchange through an initial public offering.

Uri Cohen, Clear Street’s chief executive and co-founder, told CNBC the firm wants to reduce friction and broaden access to more investment products. He said wealth creation has increasingly occurred in private markets, and that retail and smaller investors are showing more interest in participating.

Clear Street also plans to let investors finance eligible pre-IPO holdings, CNBC reported. Cohen said the broker can offer margin loans against those positions because it handles asset servicing and risk management internally. A margin loan is borrowing secured by an investment position, which can increase both potential gains and potential losses.

Why private-company investing is drawing more attention

CNBC reported that more startups are remaining private for longer, which means a larger share of their value growth can occur before an IPO. That has increased demand from wealthy investors looking for exposure to companies such as Databricks, Anthropic and OpenAI before they enter public markets.

Clear Street expects to add as many as 30 startups to the platform by the end of the year, Cohen told CNBC. He said most would be technology companies valued between $5 billion and $20 billion and roughly six months to two years away from an IPO.

The company is also creating private-company equity research led by analyst Owen Lau, according to CNBC. Cohen described the research effort as a way to bring more transparency to private markets, which typically provide investors with less standardized information than public markets.

Clear Street is building this while its own IPO waits

The launch comes after Clear Street paused its own IPO plans in February, CNBC reported, citing broader market volatility that pressured broker and fintech valuations. The firm was valued at nearly $12 billion in a private funding round earlier this year, according to Bloomberg reporting cited by CNBC.

Cohen told CNBC that Clear Street is cash-flow positive and added liquidity through a $400 million investment-grade bond offering. He said the company shelved its listing for better timing and is looking toward a 2027 IPO depending on market conditions.

Clear Street is not alone in trying to meet investor demand for private-company stakes. CNBC reported last week that Goldman Sachs created a platform to expand private-market offerings for wealthy clients and family offices seeking direct positions in fast-growing private companies.

This story draws on original reporting from CNBC.