In listed markets dominated by the East Coast, the stock exchange project located at the heart of California’s innovation is becoming more and more concrete. Supported by major private equity names, it could be operational before 2020.
The last missing approval came through the SEC, the US Financial Markets Authority. The horizon is now clear for the creation of the Long-Term Stock Exchange (LTSE). This scholarship for start-ups will focus, as its name suggests, on long-term investments and will reward the desire for sustainable, ethical and diverse growth. The advantage will be given to investors, whose voting rights will increase in value over time, which should ultimately benefit the founders.
The objective of this market and its founder Eric Ries, entrepreneur at the origin of the “lean start-up” concept, is to get young companies to go public earlier than the current 12-year average, thus sharing more broadly the strong growth of the early days. Designed as a response to the volatile and short-term logic of the East Coast financial centres, LTSE will offer solutions that are better adapted to the needs of start-ups, which are often fragile when they start up.
As the last step before the arrival of its first customers, the LTSE will propose its listings criteria to the SEC in the coming weeks, thus validating its operation as a public market where company shares can be sold and purchased. Once this step has been taken, the objective of a launch at the end of the year is envisaged.
The Long-Term Stock Exchange will be the only Californian stock exchange and will offer its companies the opportunity to be listed both on the LTSE and in other markets, particularly those of New York, which are very fond of the values of new technology oriented companies.