There is a growing policy push to create a Venture Exchange, or exchanges, to facilitate the purchasing and selling of new types of securities in smaller cap companies. Â A securities value is best determined by the market and if one does not exist valuations are challenging at best. Illiquid securities by nature may carry a liquidity discount thus diminishing value for some investors when they want to sell.
The signing of the JOBS Act in 2012 has sparked a resurgence in the discussion as to how best allow transactions for holders of equity in smaller firms. Â Some believe securities should be traded as part of established exchanges such as NASDAQ, NYSE or OTC Markets. Â Others see a more organic and distributed transaction marketplace, or perhaps a combination of all the above. Â Regardless, creating a robust secondary market is not a foregone conclusion.
There is keen interest growing within the offices of the SEC and on Capital Hill, the possibility of a new regulatory approach to foster a market for securities that will fall under the new Reg A+ and perhaps under a reconstituted Title III of the JOBS Act – and more.  Now is the time to review the successes and failures of past exchanges and those in operation around the world.
The Heritage Foundation has compiled a team of four experts in the space and they will be live streaming a discussion on Venture Exchanges on Monday (May 4th) next week.  This is an excellent opportunity to hear about the impediments and possibilities in establishing venture markets.
The speakers include:
- R. Cromwell Coulson – CEO OTC Markets
- David Weild, IV – CEO Weild & Company (former Vice Chair of NASDAQ)
- Thaya Knight – Associate Director, Financial Regulation Studies, Cato Institute
- Leonard J. Amoruso – Partner, Murphy & McGonigle
You may sign up here – or if you happen to be in DC you may attend in person. (free to attend)