Jonathan Platt, a 27-year-old pharmacy school graduate, requested about $10,000 worth of Apotex shares through Wealthsimple, saying the offering prompted him to invest earlier than he otherwise would have.EDUARDO LIMA/The Globe and Mail
Jonathan Platt knows a lot about the pharmaceutical industry, as a pharmacy school graduate himself. Even with that expertise, the 27-year-old wanted to wait at least six months before investing in Canada’s largest drug manufacturer, Apotex Health Corp., after it went public.
Then, Wealthsimple offered a chance to request shares before the stock begins trading, and his plans went out the window.
The online investing platform said last week that retail investors could request shares in select Canadian and U.S. initial public offerings at the launch price before public trading begins, known as IPO access, with Apotex as its first offering. Mr. Platt requested 345 shares at a price of $20 to $24 per common share, an investment estimated at roughly $10,000.
“If that option wasn’t there, I wouldn’t have bought for months,” said Mr. Platt, who is based in Toronto.
On Thursday, Wealthsimple also started offering IPO access to Elon Musk’s aerospace company SpaceX, one of the most highly anticipated offerings of the year.
Mr. Platt is part of a growing wave of retail investors gaining access to IPOs that were once largely behind velvet ropes, with shares typically allocated to institutional investors and wealthy clients.
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As IPO excitement builds around sought-after companies such as Apotex, SpaceX and AI darling Anthropic, Canadian investment platforms are racing to give everyday investors earlier access to public offerings – a shift that some financial experts say should be approached with caution.
“Any time there’s a democratization of some exotic product, it’s not a good thing for retail investors,” said Benjamin Felix, chief investment officer and portfolio manager at PWL Capital.
Wealthsimple’s new product allows eligible clients to request shares in select IPOs with no minimum order size and no additional fees, according to a release. Investors who receive an allocation pay only the final offering price. Wealthsimple works with investment banks that allocate a portion of IPO shares to the platform for distribution to clients.
Investors may receive only a fraction of the shares they request, or none at all, if demand exceeds supply. Wealthsimple also bars clients who sell or transfer IPO shares within 90 days from participating in future offerings, a restriction common among U.S. brokerages.
While IPO access is not new to the Canadian market, online brokerages are trying to widen access to similar products in an attempt to attract self-directed investors. Shortly after Wealthsimple’s announcement, Questrade Financial Group Inc. said it plans to offer even earlier access to select private companies prior to their IPO launches, starting this summer. The firm has offered launch-day access to certain IPOs since 2013.
There has been an increase in demand for opportunities to request shares in high-profile companies before they go public. Anticipation around a potential SpaceX IPO, for example, has fuelled demand for funds with exposure to the company.
Apotex workers walk outside the company plant in Toronto in 2021.Nathan Denette/The Canadian Press
Shawn Poncha, a 22-year-old who works in business operations in Toronto, said he requested shares for Apotex through Wealthsimple to gain experience participating in an IPO before SpaceX’s offering.
“Why not buy a few shares through this offering and see how it goes, and maybe even test it?” he said. Mr. Poncha requested 100 shares of Apotex, an investment of roughly $3,000.
Wealthsimple declined to say which companies it would offer shares in, noting that it can only provide access to deals it is invited to participate in.
Typically, Canadian brokerages can only offer retail investors IPO access from companies that file a prospectus in Canada. SpaceX filed a prospectus in the country in May.
Even when investors do gain early access to an IPO, strong returns are far from guaranteed.
A 2025 study by researchers in the United States and China found that IPO access products that offer shares to retail investors at the same price as institutional investors underperformed those not offered to retail investors by roughly 20 percentage points during their first year as public companies.
The researchers attributed the gap partly to more aggressive pricing and partly to attention-driven retail trading, with investors piling into offerings that generate online buzz.
“When stocks are being promoted by the investing apps, people are going out and Google-searching them when they otherwise probably would not have done,” Mr. Felix said.
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Julius Muljadi, a 42-year-old creative director in Winnipeg, said he first learned about Apotex’s IPO through a promotional banner on Wealthsimple’s app. “I didn’t even know anything about Apotex,” he said. Like Mr. Poncha in Toronto, he requested 100 shares at an estimated cost of about $3,000.
“The hype from SpaceX IPOs, and then potentially OpenAI or Anthropic, those are all superexciting that I didn’t think that I would get a chance,” Mr. Muljadi said.
Mr. Felix said many investors are drawn by the prospect of an “IPO pop,” the jump that sometimes occurs when a stock begins trading publicly. While those gains can be significant for investors who receive shares at the offering price, there is no guarantee they will materialize. Many IPOs struggle after their debut.
“There can be a perception that an IPO is a magical way to make money,” said Jason Heath, managing director of Objective Financial Partners.
Mr. Heath said investors should consider why they want to participate in an IPO. Someone who plans to own a company for years may have a very different outcome than someone hoping for a quick profit after the stock begins trading.
Mr. Platt, the 27-year-old pharmacy graduate, said he is approaching Apotex as a long-term investment. And even though he believes there is too much hype around upcoming IPOs, that isn’t stopping him.
“Even though I’m participating, I’m worried for a lot of people.”