PIPE allows for a class of investor known as an ‘Observer’ who wishes to look, but not yet participate. Observers are treated as an investor within PIPE but with no liquidity and no investment options.
There are many individuals and groups who may wish to observe the PIPE process and be on the periphery of the system, although as an observer there is no option for engaging with either investment or Q&A.
Simply put, the observer can see projects that have successfully navigated the PIPE system and have been approved for investment. The observer can see the Protégé Companies as they move onto PIPE and can see their value and investment profile, but cannot use the analysis tools or reports to gain greater understanding of the project for investment or due diligence purposes.
Observer status can be given to private HNWI’s, Venture Capital Investors or other investor groups as well as Regulators, Institutions (universities, research groups etc) or other interested parties.
Observers may be excluded from project disclosure subject to their profile and the appetite of academic founders, who may choose at the project disclosure stage to exclude certain groups to protect their patent/IP.