From public to private: How capital raising is changing for Australian businesses
For generations, the Australian Securities Exchange (ASX) was the natural destination for businesses chasing capital and credibility. But, as compliance costs climb and private equity becomes more accessible, many firms – including those in South Australia – are turning to private markets instead.
Industry players say the shift is reshaping how businesses raise money, how brokers operate and what opportunities investors can access.
Steven McLean, director of private markets platform FCX, says the regulatory burden on listed companies has grown dramatically.
“If you looked at the annual report that a publicly listed company produced 10–15 years ago, and then you compared that to the same company today, they would be materially different documents,” he says. “A lot of that is really a function of the increased oversight, the increased level of compliance that is imposed on listed entities from a whole bunch of stakeholders.”
Some of that is driven by environmental, social and governance (ESG) expectations. Investors, fund managers and regulators are demanding companies not only declare their own commitments but prove them through supply chain reporting.
“Gone are the days where, as a company, you could say, ‘Listen, we highly support the anti-modern slavery initiatives’. Now, those companies are being asked to also look at their supply chain with that lens as well,” McLean says.
Private markets come of age
At the same time, investors are more familiar with private equity, private credit and alternative assets than they were a decade ago.
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“If you asked a normal investor 10 years ago what a private equity fund does, they probably wouldn’t have been able to tell you,” McLean says. “Now, through the growth of private assets, there’s more education and awareness. People are becoming more comfortable with those asset classes, and their ability to generate returns is becoming better understood.”
Access has also widened. Where minimum investments once started in the tens of millions, private equity managers now accept commitments as low as $50,000.
This so-called “democratisation of investment” is making previously exclusive opportunities available to a much broader pool of investors.
“It’s great for the economy, investors and Australia,” McLean says.
These shifts are also changing the role of traditional stockbrokers. “Many years ago, you could go, ‘That group’s a stockbroker and that group’s a financial planner’. Now, the stockbroker community has been morphing into wealth management,” McLean says.
With fewer new opportunities on public markets, brokers are expanding into private assets to enhance their client offerings. Some are still early in the journey, but those serving ultra-high-net-worth investors already offer global alternative assets and corporate bonds.
Platforms like FCX are helping them make that leap by providing regulated access to private markets.
Cracking the liquidity challenge
Liquidity, the ability to buy and sell shares, has long been the stumbling block for private companies. While raising fresh capital has generally been achievable, allowing existing shareholders or employees to cash out has been more difficult.
McLean says FCX was designed to tackle that problem. “It enables normal, hardworking people in these businesses to get access to and be rewarded by selling their shares to other investors on a semi-regular basis,” he says.
The platform combines technology with regulation, licensed by ASIC and the Reserve Bank of Australia, to build trust. “Regulation facilitates trust and, without trust, you can’t get scale,” McLean says.
Opening doors for South Australian firms
For South Australian companies, the timing could be significant. FCX is owned by FinClear, a national business with more than a million investor accounts across the country. That reach means an Adelaide-based firm doesn’t need to individually cultivate dozens of investor channels.
“What it means is high-quality companies within South Australia now, via the FCX platform, can access all points of Australia from an investor perspective,” McLean says. “It just cuts through a whole bunch of heavy lifting that a private company would need to do in order to present themselves into the broader investor universe.”
And crucially, that investor base is not confined to the major capitals. “
If you’re a high-quality widget manufacturer in Murray Bridge, you’re not only getting in front of Sydney and Melbourne investors – you can also reach those regional networks,” McLean says. “There’s a resonance with regional businesses, because a lot of that investor base also has interest in the regions.”
The rise of private capital is not about replacing public markets, which remain critical for large companies chasing scale. But for mid-sized and growing firms – particularly in South Australia – the combination of investor appetite, broker evolution and new technology platforms is opening the door to new sources of funding.
“A lot of the new and innovative opportunities to invest outside of public markets are in private markets,” McLean says. “That’s an ongoing trend we expect to continue.”
FCX is a proud partner of the South Australian Business Index lunch and networking event on Friday, October 17 at the Adelaide Convention Centre. View the Top 100 businesses when the 2025 South Australian Business Index is officially unveiled.
