So if I understands correctly it’s intended to be a place where one can only go long on shares? Why would some company list here? Why would investors use it? That post was 2 paragraphs long and explains nothing.
The Long-Term Stock Exchange Comes to Life
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Re: The Long-Term Stock Exchange Comes to Life
#12I find some irony in that the frequently stated mission of the LTSE is, well, long term thinking, and yet the most recent Dec 7 medium post is about how excited they are to be accelerating their launch by pairing with an existent platform.
Re: The Long-Term Stock Exchange Comes to Life
#13Their about page is kinda weird. Unless there are a bunch of people not listed, it seems like there are only 3 people in the company who aren't a manager of some kind. For example there are 2 software engineers, a software engineering manager, a VP of technical operations, and a vp of engineering.
Re: The Long-Term Stock Exchange Comes to Life
#14https://www.wsj.com/articles/silicon-valley-vs-wall-street-c... In the linked WSJ article, that explains this quite a bit better than the medium blogpost. Basically, it appears that the main thing is that the voting power of shares win increase with the time the shares are owen. (Though there's talk of opting in to this process.) There's also going to be a prohibition on companies giving quarterly earnings guidance.…
> it's intended to reward founders and long-term employees of startups by privileging them over the more retail class of investor
It will just prioritize investors with the sense to stick their shares in an SPV (e.g. an LLC or trust) and then sell the SPV with the premium voting rights attached. (Also amplify the benefits of intergenerational wealth transfer.)
Re: The Long-Term Stock Exchange Comes to Life
#15Very much looking forward to this idea coming into fruition. The post doesn’t give much information though. I‘d so wished, that a service like Robinhood and this too were available in Europe.
Re: The Long-Term Stock Exchange Comes to Life
#16"Tenured shareholder voting power, meaning that a shareholder’s votes would be proportionately weighted by the length of time the shares have been held"
I wonder if we're going to see the rise of holding companies just to get around this rule. "Our holding company owns shares in XYZ, and will never sell those shares ever. Instead of buying/selling XYZ directly, you can instead buy/sell shares in our holding company. We will confer voting power in XYZ, proportional to how many shares of our holding company you own, regardless of how long you've held them."
I suppose one way to prevent this loophole is to grant voting power only to individuals, and not entities, but that would screw over index-funds, mutual-funds, foundations, non-profit-endowments etc etc.
Re: The Long-Term Stock Exchange Comes to Life
#17https://www.wsj.com/articles/silicon-valley-vs-wall-street-c... In the linked WSJ article, that explains this quite a bit better than the medium blogpost. Basically, it appears that the main thing is that the voting power of shares win increase with the time the shares are owen. (Though there's talk of opting in to this process.) There's also going to be a prohibition on companies giving quarterly earnings guidance.…
Ah so this is yet more locking out the ordinary Joe from this sort of investment and another way to screw over employee share holders.
Re: The Long-Term Stock Exchange Comes to Life
#18Unless this was launched by State Street or Vanguard how would anyone think this was a good idea or effective idea More like Zero Liquidity Stock Exchange am I right?
Or how the SEC allowed it
Re: The Long-Term Stock Exchange Comes to Life
#19"Tenured shareholder voting power, meaning that a shareholder’s votes would be proportionately weighted by the length of time the shares have been held" I wonder if we're going to see the rise of holding companies just to get around this rule. "Our holding company owns shares in XYZ, and will never sell those shares ever. Instead of buying/selling XYZ directly, you can instead buy/sell shares in our holding company.…
Nowhere near a lawyer here, but:
Would it be possible to contractually obligate any entities holding these stocks to also adopt tenured shareholder voting power?
Doing so would certainly improve the loophole situation, though I suspect it doesn't fix it entirely... Things probably get weird when you nest tenure effects.
Re: The Long-Term Stock Exchange Comes to Life
#20Well, I like the general idea, but am not sure about their implementation. Obviously have to wait for details, like SPV vs. real-person ownership.
But I wonder about their approach -- couldn't any public corporation, any time it wants, put long-term goals into its "constitution" or whatever you want to call corporate goals? Though perhaps their exchange will eventually put pressure on corporations to do so.