The world of securities trading is about to get a new player: The Dream Exchange -- advertised as the first minority-owned stock exchange in the U.S. -- is preparing to open for business in 2021.
Founded in 2018, the Dream Exchange is a partnership between Joe Cecala, a veteran securities lawyer, and Cadiz Capital, a majority Black-owned mergers-and-acquisitions boutique based in St. Louis.
A key mission of the exchange will be to provide a market in which minority-owned businesses can raise capital. It believes that small initial public offerings -- those under $50 million in total -- can be a driver of the economy, but they have essentially vanished in favor of much higher-ticket issues. This has also impacted minority-owned businesses, as many of these that would want to go public would have IPOs falling into the sub-$50 million category.
This isn't the partnership's first professional involvement with a stock exchange. Earlier in his career, Cecala was the lawyer for executives in a company that created what Dream Exchange says was the first electronic trading system in this country. That system, Archipelago, was acquired in 2005 by -- and absorbed into -- the New York Stock Exchange, which is now a unit of Intercontinental Exchange (NYSE: ICE).
The Dream Exchange's website offered few specifics -- lacking, for example, any suggestions about which companies might list on it, or what competitive advantages it might hold over Intercontinental Exchange and other established market operators.
Still, many finance industry professionals believe that more sources of funding are needed for minority-owned businesses if they are to grow and thrive. Next year, we'll see if Dream Exchange can successfully provide one.
10 stocks we like better than Intercontinental Exchange
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Intercontinental Exchange wasn't one of them! That's right -- they think these 10 stocks are even better buys.
*Stock Advisor returns as of June 2, 2020
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.