Business of Fintech

New stock exchange approved, Silicon Valley readies another

  • Recently-approved IEX aims to level playing field
  • A stock exchange for long term investors?
close

Email a Friend

New stock exchange approved, Silicon Valley readies another
After a lot of wrangling with the SEC, IEX was finally approved to become a full-fledged exchange. The startup, whose founder was made famous by his depiction in Flash Boys, hopes to even the playing field somewhat by instituting a 350-microsecond speed bump in the orders it's routed. Supporters of the upstart exchange welcome its fresh, democratic approach towards a market that's essentially become a badly designed computer network: "It’s as if Comcast, Time Warner, and Charter were competing to send you Game of Thrones, every time you turned on your TV," wrote Christopher Groskopf in Quartz. Detractors say the approval of a new exchange just adds fragmentation to a market that already has 12 exchanges and dozens of private trading venues. "By slowing down their outgoing market data, it becomes very difficult to determine who has the best price, and where to send that order to," Larry Tabb, CEO of an influential market research firm, told The Verge.

Using the stock exchange to end short-termism

IEX isn't the only new stock exchange -- Silicon Valley isn't done quite yet targeting exchanges. There's a plan afoot (and real investors) to create the Long Term Stock Exchange (LTSE), an attempt to cure the incessant cycle of short term focus for both reporting companies and their investors. The move is being lead by Eric Ries, the author of Lean Startup, who believes it would also reinvigorate the IPO window for top startups currently choosing to stay private. The startup is in early discussions with the SEC but the intention is that, in addition to general regulatory requirements, the body would also enforce a new set of incentives, including tenured shareholder voting power and tying executive pay to long-term business performance. “You’re advertising to the markets that you’re willing to be held to a higher standard,” Ries told Bloomberg. “This is the gold standard, the most long-term, the most hardcore version of going public.”

0 comments on “New stock exchange approved, Silicon Valley readies another”

4 charts, Business of Fintech

Q3 fintech funding: Investors cut fewer deals and signed smaller checks

  • Facing a looming recession and uncertain macroeconomic conditions, fintech investors are more hesitant about signing large checks.
  • While fintech funding dropped to 2020 levels, the US continued to lead global funding share by a large margin.
Lindi Miti | November 22, 2022
Business of Fintech

How fintechs performed in Q3 2022: Nubank, SoFi, MoneyLion

  • The economic environment is tough but fintechs are doing well - NuBank, SoFi and MoneyLion reported growth in their customer base, revenues, and profits.
  • The industry is undergoing a shift from focusing on new customer acquisition to cross-selling and up-selling to existing users.
Subboh Jaffery | November 22, 2022
Business of Fintech, Sponsored

How to successfully pitch investors in today’s economy

  • As the fundraising environment continues to tighten, fintechs are challenged to make the most of every meeting and interaction with venture capital firms.
  • To successfully pitch investors, fintechs should prepare with a pitch deck, demo, research and questions.
CMFG Ventures | November 16, 2022
Business of Fintech

Tearsheet’s 2022 guide to Money 20/20

  • Money 20/20 is the industry's biggest and most influential event.
  • Here's what to look out for at this year's conference.
Tearsheet Editors | October 20, 2022
Business of Fintech, Member Exclusive

While the US fintech gets its act together after valuations tumble, is China leaping forward?

  • As the fintech industry expands in China, will the US stand out from the rest of its competitors?
  • The pandemic caused higher interest rates, lower valuations, and economic uncertainty – which has been cited as the reason behind the failure of fintechs – but maybe it is time to rethink that premise.
Sara Khairi | August 31, 2022
More Articles