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Eunice Wong combines stock tipping with sun, sea and sand. 

Eunice Wong loves puppies, tattoos and sunshine. When she isn’t posing for Instagram shots, the self-proclaimed venture capitalist is working her keyboards, pushing stocks on Twitter.

Last Sunday, filming herself standing in an orange bikini on a coastal headland, she promised a stock tip to anyone who could identify her location. (She was in Byron Bay.) The video has been watched almost 10,000 times.

As someone who aspires to make a living trading and investing, one of Wong’s hopes is Nature One Dairy, a Melbourne infant formula manufacturer. “This could be one of those opportunities that comes along and changes life!” she Tweeted last year.

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When Eunice Wong isn’t posing for Instagram shots, the self-proclaimed venture capitalist is working her keyboards, pushing stocks on Twitter. Instagram

Wong’s interest in the float, which the company’s owners, Singapore-based Nick and Masie Dimopoulos, hope will value their stake at $50 million or more, didn’t happen by chance. Her boyfriend, prolific online stock promoter Assad Tannous, has been paid to raise money for the company.

The use of an aspiring Instagram star (25,300 followers) to attract interest in an upcoming IPO illustrates how the floats of small and medium-sized stocks – despite their use of complicated terminology and detailed financial forecasts – are often driven by public relations hype aimed at unsophisticated investors.

While international investment banks such as Macquarie Group and UBS are closely monitored by regulators, funds and the press, bankers for small and mid-sized companies operate under far less scrutiny.


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The fees for floating small companies can be as high as 10 per cent. For a big stock, a broker will normally charge around 3 per cent.

In return for big fees, smaller brokers are prepared to take bigger risks with less-established clients. If everything goes well, everyone makes money: the founders, managers, bankers and investors. When they don’t, the bankers still get paid, and shareholders can be left with worthless stock.

Last year, Bell Potter and EL&C Baillieu and some minor advisers received an astonishing 12 per cent, or $2.1 million, of the $17.4 million raised for floating Powerwrap, a Melbourne provider of computer networks for financial advisers.

Powerwrap shares have halved since the May listing. ( Will Davidson, who last year was paid $440,000, was too busy to discuss the float, according to a .)

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With the share market roaring up, investors have been offered a plethora of dud floats.

Perth-based Emerald Clinics listed last Wednesday. In the first week of trading, insiders or early investors dumped their shares, sending the cannabinoid clinics stock 40 per cent below the issue price.

A small Melbourne corporate finance firm, PAC Partners, was paid $711,000 to raise money and float the company, and received one million shares for a nominal price. (PAC asked that it not be named in this article.)

On Thursday, another medical-cannabis stock floated – and crashed. Little Green Pharma set aside 10 per cent of the $10 million IPO funds for Canaccord Genuity, its stockbroker, and other advisers. The stock fell 27 per cent on the first day, then rebounded on Friday.

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EL&C Baillieu of corporate finance Stephen Macaw pitched Nature One Dairy to a dubious Arab businessman. 

Other recent failed floats include medical cannabis company Cronos , which listed at 50¢ in November and is now 15¢ (Bell Potter); Trigg Mining, which floated in October at 20¢ and is now 5.5¢ (CPS Capital Group); Blockchain expert Tymlez Group, which floated in late 2018 at 22¢ and is now 2.7¢ (Peak Asset Management); and Frontier Diamonds, which floated in late 2017 (Novus Capital). The shares no longer trade.

The corporate regulator has noticed. Last year the Australian Securities and Investments Commission found several small-company floats were, in its words, “structured to deliver positive short-term benefits for a small subset of investors”.

The beneficiaries were stockbrokers’ preferred clients. ASIC was also troubled by the sales pitches and “the risk that these materials might mislead investors”.

In an era when a stock trade can cost less than a glass of wine, small and medium-sized companies provide one of the few lucrative sources of income for stockbrokers.

EL&C Baillieu was paid about $500,000 when it raised $10 million in December for 4Dx, which has developed a lung scan that can apparently detect asthma.

The “pre-IPO” round was designed to get the company ready for a float this year, which EL&C Baillieu was perfectly placed to manage for an even more lucrative fee – until the firm’s inner-IPO workings were exposed to a bemused world.

In January, secret recordings of Stephen Macaw, EL&C Baillieu’s head of corporate finance, were distributed describing him trying to sell shares in another client yet-to-be listed, Nature One Dairy, to an actor he thought represented wealthy United Arab Emirates investors.

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“So, on the 23rd of September, we’re taking probably 15 or 20 investors down from Sydney and Melbourne out to see those guys and show them around,” Macaw says on the recordings. “So, what ideally what we’d do, if you guys are interested, we’d move ahead of that, we’d be a week ahead, and basically just say that we’ve already got some cornerstone interests, and we won’t disclose the party.”

Macaw explained how dollars are spun off in the IPO chain. In Nature One Dairy’s case, an early investor would be given access to confidential information about regulatory approvals of its infant formula, Macaw said.

“I know they’ve already got the Chinese approval, but it can’t be announced for three months,” Macaw says on a recording, which he has confirmed is genuine. “So, I can’t tell. I can’t go out to the Australian market and tell them that. But I can tell you that.”

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Nature One Dairy founder Nick Dimopoulos was present when Eunice Wong toured his factory last September. Eamon Gallagher

Macaw has subsequently denied any wrongdoing and said that he wasn’t advocating inside trading, because Nature One Dairy wasn’t listed. His words, which he claims were “cut and spliced to create a false impression”, might be interpreted as suggesting another investor decided to sell shares in the “pre-IPO” fundraising round after they became aware of the regulatory clearance.

“Because they know that, they don’t want to take too much money yet. They only want to do 10 million,” Macaw says on the recordings.

(A spokesman for Nature One Dairy says the owners didn’t trade on non-public information. “At the time, the owners were unaware of these discussions taking pace,” he says. Macaw didn’t respond to a request for comment.)

Over a meal, in either Copenhagen or London, Macaw offered to sell $5 million in Nature One Dairy shares to the wealthy Arab, and said $5 million will be allocated to other investors.

He didn’t mention that one of the other shareholders would be Jan Cameron, who last week was charged with securities violations. Perhaps he didn’t know.

The other early investors weren’t as notable as the $1 billion-pretend investor from London or the Kathmandu clothing-chain founder.

An anonymous but prolific poster on the Hot Copper stock-chatroom stardestr0yer, said in September that he or she had been given access to the pre-IPO round.

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Eunice Wong joined an investor tour of Nature One Dairy’s Melbourne factory on September 24. Co-founder Nick Dimopoulos appears, briefly, in a video she posted online of the plant. He then sent her half-a-dozen tins of formula. She tweeted: “Can’t wait for the IPO!!!”

Her presence suggests she was offered pre-IPO shares too. Tannous, her boyfriend, said last year he had been offered a 4 per cent commission and 4 million options for promoting Nature One Dairy to professional investors.

“They changed their mind,” on the options, he said this week, but he was paid a commission for helping raise “seed” funding to get the company started.

Both say they are prohibited from discussing Nature One Dairy’s prospects until a legal investment document for the float is published.

A spokesman for Nature One Dairy denies Tannous and Wong are shareholders.

Back at the conversation with the would-be investor, Macaw explained how the float process would play out. Pre-IPO funding is often used to hire sales and distribution staff to create a revenue spurt that makes a business more attractive.

Macaw told “Mustafa” the pre-IPO fund raising would mean Nature One Dairy would only have to raise another $15 million when it floated. That would be good for existing shareholders. It would minimise the dilution of their investments.

After a valuation of around $50 million to $75 million in the pre-IPO sale, the stock would be sold at $150 million or $200 million in the float, Macaw seemed to suggest.

“So we make three times,” he says on the recordings. “You buy now and then it goes into the IPO.”

If the would-be investor wants to sell post-float, Macaw urges him not to use EL&C Baillieu. That would make Macaw look bad to the founders, who presumably don’t want the embarrassment of their stock being dumped.


Whatever happens to Nature One Dairy, Macaw isn’t going to make any more money out of it.

The company raised $6 million in the pre-IPO round last week. EL&C Baillieu clients contributed only $1 million, according to a Nature One Dairy spokesman, which suggests the Danish sting may have hurt Macaw’s legendary ability to raise cash.

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Stock tipper and aspiring Instagram star Eunice Wong has 25,300 followers. Instagram

Nature One Dairy will choose a new stockbroker in due course, a spokesman says, and plans to go ahead with a float this year.

Meanwhile, Eunice Wong aspires to convince people that share trading is more worthy than posing in bikinis. “[It] would be good to influence more people to invest than posing on Instagram,” she says.

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Aaron Patrick

Aaron PatrickSenior CorrespondentAaron Patrick is The Australian Financial Review’s Senior Correspondent. He writes about politics and business. Connect with Aaron on Twitter. Email Aaron at [email protected]

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