RE: Next fund raise10 Mar 2021 11:57
GreenValueHunter, my thoughts for what they're worth as an investor from almost day one.
Jim Mellon is a billionaire, professional investor and entrepreneur. Through Agronomics he has provided an opportunity for small private investors such as us to invest in future food including cellular agriculture, be aware though that his primary motive will always be to increase his own wealth. He has made moves to take the company private in the past with a derisory offer to shareholders. There is also a rather ambiguous profit bonus that he receives upon certain conditions, that has the potential to slightly dampen shareholder gains. I'm not suggesting he's any worse than anyone else, but he will put his own interests ahead of yours.
Buying Agronomics shares is pretty much the only option for small investors to gain exposure to this sector. It can be described as a fund but differs in regulatory obligations to a unit or investment trust. The shares are AIM listed which means it subject to looser regulation than main market listed share. Bottom line is you not particualarly well covered if things go wrong.
When the company raise funds by issuing more capital you may or may not be invited to participate, that's entirely up to the BoD. Fund raises generally (particuallarly on AIM) are often viewed as negative by investors and some will seek to undermine a share price on that basis. I think with Agronomics all raises so far have had a positive outcome, enabling further investments. I also think that large institutional take-up is a vote of confidence and should help to protect the interests of small investors. I would welcome further dilution to increase exposure to early stage investments.
My general feeling is that whilst not being perfect this is a worthwhile long-term investment. I'm excited for the sector but looking ahead I will be happier holding individual shares in actual companies as and when they IPO, in the meantime this will do.
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