StartEngine, one of the largest securities crowdfunding platforms in the US, says the first secondary transaction has taken place on its marketplace.
StartEngine said in an email:
“Since launching Marketplace a little over three weeks ago, we’ve received a little over 300 offers to buy and sell on the bulletin board, potentially driving liquidity for the first time for many investors. By the way, many of those were purchased on startup investment sites other than StartEngine.”
The indicative trades are noted by a “processing sale” tag on the bulletin board (we counted 20 different issuing firms).
After years in the making, StartEngine is executing on an ambition that can provide liquidity for private securities beyond a traditional merger and acquisition or perhaps a public offering – for companies that make it that far. StartEngine had to be approved to operate an Alternative Trading System (ATS) as well as receive special approval under its BD license before it could enable trading. It is interesting to note that StartEngine will facilitate trades from securities issued via other platforms. Currently, StartEngine is the only platform of its kind to offer this type of service.
While trading volume will be inherently light, or little at all – perhaps for years, by providing an option for investors to sell (or buy), StartEngine is pushing forward in improving the viability of online capital formation in the US.