StartEngine, a leading securities crowdfunding platform, has announced that it will fire up its secondary marketplace for crowdfunded securities this coming Friday, (October 30).
StartEngine started the process to launch “StartEngine Secondary” years ago. A pre-cursor to receiving approval to operate an “alternative trading system” (ATS) is receipt of a broker-dealer license. An ATS is similar to a regulated “exchange” but operates under a different set of rules. By operating an ATS, securities issued via the StartEngine platform may provide an element of liquidity beyond a merger/acquisition or initial public offering. Many industry observers believe that a secondary marketplace can help the crowdfunding sector scale as it means investors have a faster path to exit investments in an asset class that is historically very illiquid.
In an email, StartEngine said that it was hosting an “opening bell” on Friday, at 930AM PT, which will include the participation of StartEngine CEO and co-founder Howard Marks along with well-known shark Kevin O’Leary. The duo will discuss the importance of StartEngine Secondary and explain how it works watching the first trade that should take place around 10 AM PT.
It has been previously reported that the first security to trade will be StartEngine’s shares as it has self-crowdfunded multiple times and thus has a good number of retail investors holding its shares.
Marks told CI at the beginning of this month that StartEngine Secondary will launch with full trading capabilities allowing investors to place bids and asks with limits. It is expected there will be certain trading limits such as specific days when trades can match.
StartEngine Secondary will initially facilitate securities issued under Reg A+ and Reg CF but the platform has the ability to trade Reg D issued shares as well.
Of note, is the fact that StartEngine would like to extend its marketplace to other platforms but as of yet it is not clear whether other online capital platforms will sign up for the service.
