Nasdaq Private Market to become a standalone, independent company

By Pavithra R

Nasdaq, SVB Financial Group, Citi, Goldman Sachs, and Morgan Stanley announced a joint venture to establish an institutional-grade, centralized secondary trading venue for issuers, brokers, shareholders and prospective investors of private company stock.

Nasdaq Private Market will be contributed to a standalone, independent company, which will receive strategic investments from SVB, Goldman Sachs, Citi, and Morgan Stanley.

“The private markets are anything but standard and have become more diverse than ever. Using the scale and distribution of our joint venture partners alongside our market leading technology and markets experience, Nasdaq Private Market will become the go-to marketplace that connects and manages the need of the entire private ecosystem through one platform,” said Eric Folkemer, President, Nasdaq Private Market.

Nasdaq Private Market’s existing technology, client relationships, and regulatory infrastructure is expected to provide a strong foundation for the joint venture to develop a full suite of liquidity solutions for private companies. Private companies, brokers and investors can access, connect, manage and execute their private company stock transactions through a global marketplace and customized technology solutions. These tailored solutions allow private companies, brokers, and investors to have increased transparency into their program and trade criteria.

The platform will continue to manage and support private company stock transactions including tender offers, buy-side book-building, auctions, investor block trades, company directed windows of liquidity and pre-direct listing continuous trading. Additionally, the platform will provide end-to-end settlement process management and an inter-broker global marketplace through its existing alternative trading system for all customers from employees to institutions to access and transact.

“Since we launched Nasdaq Private Market in 2014, we have created a trusted platform for private companies resulting in a strong track record and robust pipeline of secondary transactions. This joint venture will accelerate our opportunities in the private company secondary trading market and establish the standard for technology-driven operational efficiencies, compliance and execution,” said Nelson Griggs, President, Nasdaq Stock Exchange.

The platform will build a unique distribution network, leveraging the joint venture partners’ relationships with private companies and investors. Additionally, institutional investor participation will be enhanced through the platform’s broker-sponsored and broker-neutral design, which is open to qualified broker-dealers.

“Innovation companies are staying private longer and need the ability to offer their employees a safe and easy way to generate liquidity while they are building their businesses. Together with Nasdaq and this impressive consortium of leading banks, we are establishing a secondary trading venue for private company stock that will offer our clients a path to employee retention in an environment where access to talent is one of the biggest challenges,” said Greg Becker, CEO of SVB Financial Group, parent company of Silicon Valley Bank.