- What is a participation certificate?
A participation certificate is a non-voting equity instrument in accordance with the Swiss Code of Obligations (Art. 656a ff. CO). It grants the holder economic rights—in particular dividend and liquidation claims— without voting rights at the general meeting.
- Why does 1000FTAD AG offer participation certificates?
1000FTAD AG uses participation certificates to:
- Raise growth capital,
- to maintain entrepreneurial decision-making ability,
- enable quick and focused strategic decisions,
- Offering investors a fair economic stake without increasing operational complexity.
This is particularly crucial for technology-driven scale-ups.
- As an investor, do I have voting rights?
No.
Participation certificates do not confer voting rights or participation in the Annual General Meeting.
Advantage: Strategic and operational decisions remain with the Board of Directors and management.
- What rights do I have as a participation certificate holder?
As an investor, you have the following rights in particular:
- Entitlement to dividends (economically equivalent to shareholders),
- Entitlement to proportional liquidation proceeds,
- Subscription rights in the event of capital increases,
- Why does it make sense to waive voting rights?
In practice, investors with small voting rights cannot exercise effective control, but:
- Slow down decision-making processes,
- restrict strategic flexibility,
- Hinder growth momentum.
Waiving voting rights provides protection:
- clear responsibilities,
- rapid decision-making,
- A stringent corporate strategy – which also benefits investors in the long term.
- Am I worse off financially than a shareholder?
No.
Participation certificates are economically equivalent to shares, as the articles of association do not stipulate otherwise. This means:
- equal dividend entitlement,
- equal share in the value of the company,
- same exit participation.
The only difference is the lack of voting rights.
- How do I participate in an exit?
In the event of an exit (e.g., sale of the company, merger, IPO):
- you participate proportionally in the sales proceeds,
- under the conditions defined in the articles of association,
- equal to shareholders in economic terms.
- Could there be dilution?
Yes, economic dilution is possible with capital increases, as with any investment.
There is no dilution of voting rights, as participation certificates do not carry voting rights.
- Are participation certificates tradable?
Tradability depends on:
- the statutory provisions,
- possible restrictions on transferability,
- a subsequent initial public offering
- The demand on a secondary market
In the early stages, participation certificates are generally less liquid and should be viewed as a long-term investment. Although participation certificates can be sold at any time, a buyer must be found.
- What are the risks for investors?
Typical risks of a seed or growth investment:
- Business and market risks,
- technological risks,
- regulatory changes,
- limited liquidity.
1000FTAD AG consciously reduces governance risks through clear management structures and focused decision-making processes.
- Why is this model established in Switzerland?
Many successful Swiss companies have been using non-voting equity securities for decades to:
- Financing growth,
- Maintaining control and vision,
- Nevertheless, allowing investors to participate economically.
Participation certificates are therefore a proven, legally secure instrument in Swiss corporate law.
- For whom are participation certificates particularly suitable?
Participation certificates are suitable for investors who:
- would like to participate in economic success,
- not seeking operational co-determination,
- Have confidence in management and strategy,
- want to invest in the medium to long term
- How is transparency ensured for investors?
1000FTAD AG undertakes to:
- regular financial reporting,
- clear communication about company development,
- transparent presentation of significant events.
- How are the participation certificates subscribed?
1000 FTAD does not make public offers for participation certificates, but only responds to expressions of interest from potential buyers. To this end, interested parties must complete and submit a letter of intent (LOI). The link for this can be found here (insert link).
The subscription is made via:
- a subscription form,
- the payment of the subscription amount,
- Entry in the company's participation certificate register.
Details are specified in the respective investor document (term sheet/subscription documents).
- In summary: Why is this attractive to investors?
- Participation in the growth of a technology-driven company
- Clear, streamlined governance
- Economic equality with shareholders
- Focus on value enhancement instead of co-management
