Nikkl, a Phoenix minority business enterprise that specializes in providing liquidity to unicorn company employees with vested options, says it will build up its technology platform and prepare for the launch of its investment fund next year after announcing a $5 million funding round.
The funding round was led by Heroic Ventures — an early-stage venture capital fund from Silicon Valley — along with other private investors.
Nikkl says it solves a challenge faced by employees of select unicorns — fast-growth companies with valuations of $1 billion or more — while at the same time helping their employers as well. The company provides the employees capital so they can exercise vested stock options. Nikkl then participates in the equity returns from the shares purchased and, because of the partnership, provides a buffer to the employees against stock devaluations of less than 50% of the purchase price.
At the same time, companies benefit from the investments, especially now during a time of slowing in venture capital investments amid greater economic uncertainty, the company said.
Nikkl, which was founded in 2021, said it plans to launch its investment fund in early 2023, building its capital now so that it will be able to buy into private unicorn tech companies during the current moment of opportunity brought on by reduced company valuations.
“Given today's lower valuations, it’s an opportune moment to invest in unicorns. We remain bullish on unicorns because these are the technology companies that have achieved product-market fit, and we continue to believe that the technology sector offers the best risk-adjusted returns for growth investors,” Nikkl’s Chief Executive Officer and co-founder Dan Siciliano said in a statement. “Even with recent market volatility, it's a great time to invest if you have a financial product, like ours, that provides access to a diversified portfolio of unicorns and offers downside protection.”
Heroic Ventures agreed that the timing is right for a company like Nikkl.
“We invested in Nikkl because they have the right approach at the right time with the right team,” said Matt Robinson, Heroic Ventures’ managing partner and founder, in a statement. “Nikkl and its platform offers a low-risk way for investors to take positions in the companies that offer the best prospects for growth while solving a big problem for employees.”
