The Taiwan Stock Exchange has announced two major benefits for venture capital firms seeking to list their stocks (IPOs). On the 22nd, it was revealed that the minimum capital requirement for IPO applications will be reduced to NT$1.5 billion, and the regulation regarding the proportion of total investments relative to total assets will be relaxed. The official implementation details and date will await approval from the Financial Supervisory Commission.

Venture capital firms play a crucial role in the capital market, particularly in supporting startup businesses and high-risk, high-return investment fields. However, currently, only one venture capital firm has listed on the domestic stock market: Diamond Investment, which went public in 2023. Another firm, Nengli Asia Capital, is listed on the Emerging Stock Market.

In order to expand the venture capital industry as a backbone for domestic startups, the Taiwan Stock Exchange is responding to the government’s policy to establish Taiwan as an "Asian Asset Management Center." It is advancing the strategy to "expand investment in venture capital and startups." Yesterday, the board of directors approved the loosening of the listing requirements and post-listing supervision for venture capital firms.

Regarding the listing conditions for venture capital firms, the Taiwan Stock Exchange aims to encourage more venture capital companies to participate in the IPO process and attract capital from the market, thereby fostering the development of domestic startups. Based on suggestions from the venture capital association, the minimum required paid-in capital for venture capital firms seeking to list will be reduced from NT$2 billion to NT$1.5 billion.

In addition, considering the practical investment operations of venture capital firms, the original rule that required the total investment amount over two consecutive fiscal years to account for more than 60% of total assets will be relaxed. The new rule allows the average total investment over the past two fiscal years to account for at least 60% of total assets, and the most recent fiscal year's investment must be higher than the previous year's in order to qualify for an IPO application.

As for post-listing supervision, the Taiwan Stock Exchange stated that, given the nature of venture capital firms in nurturing startup industries over the long term and their typically longer investment horizons, the current rule requiring firms to invest at least 60% of their assets or face changes in trading methods will be modified. To avoid forcing venture capital firms into hasty investment decisions that could affect shareholder rights, a three-year grace period will be provided for them to meet this requirement.

Resource: 創投IPO 申請規定 鬆綁