[Update: FundedHere has issued a statement clarifying that its platform is a secondary broker platform and not a private stock exchange. This is to clarify the misconception that it is a market operator and therefore has a license as an approved exchange.
In addition, it said that all shares price on their platform will be set based on the last valuation of each company]
Singapore-based crowdfunding platform FundedHere has launched a secondary broker platform to enable investors in private companies and startups trade shares more freely and give these companies more exit options — without going through the IPO route.
Currently, trading shares in a private market is a tedious process: it involves intermediaries, company secretaries and share registrars.
FundedHere’s new platform, called FundedX, can make the process more efficient and provide more liquidity for shareholders by supporting the whole process of trading shares in a private market, from connecting companies to a global investor base, to assessing shareholders and interested buyers, to taking on administrative burdens, and providing the transaction framework.
With FundedX, legacy shareholders such as ex-employees and early investors can monetize their returns. Employees with stock options seeking partial liquidity can also submit verification of ownership to participate on the exchange. Interested investors can submit buy requests which will be processed through FundedX’s algorithm to match transactions.
Once shareholders and investors are paired on the platform, the company, whose shares are being transacted, will then need to approve the sale and deal terms for the transaction go through. FundedX aims to have end-to-end process completed within two weeks. It expects to process its first transactions within the first three months of launch.
FundedHere, which is an Monetary Authority of Singapore (MAS)-approved platform, is also seeking to integrate blockchain-powered smart contracts, to make the transaction process more transparent, secure and cost efficient.
“No one has created a private exchange that is able to deal with the logistical challenges that come with dealing with many shareholders and investors of a company. FundedX has not only found practical solutions to enable the buying and selling of shares in private companies, but also done so on a regulated and transparent platform that boosts investor confidence,” said Reuben Lai, Senior Managing Director of Grab Financial Group, in a press statement.
Image Credit: FundedHere