Participating in an IPO is different to investing through the share markets. Because IPOs are highly regulated in the US, we can’t promote them or give you any information about a company going public.
When you sign up to Hatch you can immediately browse upcoming IPOs and add them to your watchlist. This is the best way to hear updates and be the first to know when you can place a share request for the IPO.
Our first IPO will also work a little differently to how you’re used to investing with Hatch:
Before you can place an IPO share request, you need to get verified and make an initial deposit into Hatch, so we can complete a security check on your account. You’ll be paying for your IPO shares separately, so you can deposit as little as 10c to start. Note: If you deposit less than $1.50 USD, your Hatch account balance will go into negative because of the compulsory W-8BEN tax form fee. Don’t worry, you won’t be hounded for more money, the rest of the fee will be deducted from your next deposit!
You’ll pay for your IPO shares separately to your Hatch account
Instead of ordering shares, you’ll place a share request. When share requests open, we still won’t know the final share price so you’ll place a share request for a dollar amount (e.g. I want to invest $1,000 NZD). For our first IPO, there is a minimum request amount of $50 NZD.
You’ll place a request for an NZD amount.
Once you’ve placed a share request, you’ll deposit NZD into a different bank account than you usually do with Hatch. Your request will stay pending until we’ve received payment and your payment will be held in NZD by PCN - Kiwi Wealth’s custodian. It’ll be exchanged into USD at the current exchange rate once requests are confirmed.
The exchange rate may have changed between the time you deposit and the time your NZD is exchanged to USD.
The USD amount will be used to determine the maximum number of shares you might receive.
You may not be able to sell your IPO shares for up to 5 days after the company lists.
For the first IPO, PCN will transfer your shares to DriveWealth after the company is listed on the US share markets. Then they’ll be managed like all your other shares with Hatch. It may take up to 5 business days and you may not be able to sell your IPO shares during this time (but you will be able to buy more shares, just like you usually do).
There are no fees.
Because we’re doing this differently and without the usual involvement from DriveWealth and WorldFirst, there are no exchange or brokerage fees.
You need to place your share request early if you want to participate
If an IPO is oversubscribed, we may close share requests early. You’ll be able to cancel your share request in the lead up to a company’s public debut, until requests close. More about cancelling your share request.
You may not receive all (or any of) the shares you requested
Once share requests close, your request will become a binding order as long as the final IPO price is less than 20% outside the estimated range. Depending on how popular the IPO is, you’ll receive all, some or none of the shares you request. Because you’ll pay for your IPO shares separately for the first IPO, any leftover money will be refunded to your bank account.
You won’t see your IPO request or payment in your transaction history
You’ll be able to see and sell any shares you receive during the IPO in your Hatch account after they’ve been transferred to DriveWealth. Your share request and payment won’t appear in your transaction history.