Nasdaq Enters Private-Company Trading Market

Banking, finance, and taxes

Published: March 6, 2013 9:05 am

Last Updated: April 28, 2020 2:15 am

In a move that was probably inevitable, the Nasdaq OMX Group Inc. (NASDAQ: NDAQ) today announced a joint venture with SharesPost Inc. to create a larger marketplace for private company shares. Nasdaq OMX will hold a majority stake in the venture, but terms of the deal were not revealed.

SharesPost and SecondMarket Inc. are among the exchanges that match early investors, founders and employees wishing to sell shares that are not yet listed on regulated exchanges with buyers who want access to shares in a company that has not yet held an initial public offering. SharesPost, for example, traded pre-IPO shares of Facebook Inc. (NASDAQ: FB) and currently includes trading in Spotify and Violin Memory.

The Nasdaq Private Market (NPM), as the new joint venture is to be called, is intended to provide liquidity to investors and employees of privately funded companies that are now staying private longer before holding an IPO. The new marketplace is expected to launch later this year. pending regulatory approvals.

Those approvals might be a bit tricky to come by. About a year ago, Bloomberg reported that the SEC was looking into the trading practices of SharesPost and another firm, Felix Investments Inc. No action appears to have been taken, but now that pre-IPO market is going mainstream, regulatory scrutiny is likely to be more intense.

Take Charge of Your Retirement In Just A Few Minutes (Sponsor)

Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.

Here’s how it works:

Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
Choose Your Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.

Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!