Former ASX exec casts doubt over 'subscale' startup secondary market
Private markets are swelling as public ones shrink — but doubts remain over the viability of secondaries exchanges in Australia.
Platforms offering Australian investors the ability to trade shares in privately held, highly valuable tech startups are slowly emerging in Australia, with the recently launched FloatX and PrimaryMarkets among them. But at least one market veteran and senior industry figure have serious doubts about their viability.
Max Cunningham ran the ASX listings business for nine years, before taking over as CEO of the NSX, Australia's aspiring alternative exchange. He believes there's not a sustainable business model at the heart of these private company platforms.
“I think the question is, why aren’t major stock exchanges even looking at this? And I think it’s because it’s very, very difficult to find a pathway to commercialise it,” Cunningham told Capital Brief, describing the local market as “subscale”.
“Stock exchanges aren’t making money from trading securities. They make most of it from listings fees and data and these private exchanges, in my view, don’t deliver either.”
