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The Long-Term Stock Exchange Comes to Life

blog.ltse.com

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Re: The Long-Term Stock Exchange Comes to Life

#31

Post by startupdiscuss »

eries wrote: post #29

Hey everyone, Eric Ries here. I’m the founder and CEO of the LTSE (and also the Lean Startup guy). Happy to see the discussion here and will try and answer a few questions. Unfortunately, a lot of the details of how the LTSE works are subject to regulatory approval, so I can’t share too much while we are working out the details with them. Still, I’ll do my best to answer. Thanks for the comments and happy new year

My main question is: what is the LTSE?

Is it a stock market? Will I be able to buy and sell shares on eTrade or another 3rd party platform?

Who will list shares on it?

If I had to guess, I would guess it is just like the NYSE except you can only buy and sell shares every 5 years or something.

Re: The Long-Term Stock Exchange Comes to Life

#32

Post by eries »

trothamel wrote: post #4

https://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.…

I liked your summary. We definitely think our setup is a more defensible governance solution than the typical founder/monarch for life.

Our rules also are carefully tailored to Do The Right Thing with shorts and other derivatives, but I can’t say much yet about how it works in detail

Re: The Long-Term Stock Exchange Comes to Life

#34

Post by sixQuarks »

eries wrote: post #29

Hey everyone, Eric Ries here. I’m the founder and CEO of the LTSE (and also the Lean Startup guy). Happy to see the discussion here and will try and answer a few questions. Unfortunately, a lot of the details of how the LTSE works are subject to regulatory approval, so I can’t share too much while we are working out the details with them. Still, I’ll do my best to answer. Thanks for the comments and happy new year

Eric, this is a very interesting project, I'd like to see this succeed. Be aware that Hacker News has a very negative bent when it comes to new ventures like this. You're going to get a lot of criticism about how this will never work, etc, etc.

Go read the Show HN of DropBox to see what I mean. Good luck!

Re: The Long-Term Stock Exchange Comes to Life

#35

Post by eries »

hendzen wrote: post #25
qubex wrote: post #8

Earlier quoted context omitted.

Naked shorters by definition own no stock currently so have no right to vote, but it may or may not affect calculations regarding the average seniority of stock against which rights are measured (it cannot be absolute, since you could conceivably have a situation where everybody shuts purchased the stock, and thus ownership of all would be zero, and thus nobody would have a right to vote). And what of options and oth…

Yeah I expect these rules will be rendered effectively moot by equity swap trading.

Our rules handle derivatives correctly, including swaps. Otherwise it would be trivial to avoid the long-term vote weighting

Re: The Long-Term Stock Exchange Comes to Life

#36

Post by eries »

walshemj wrote: post #17
trothamel wrote: post #4

https://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.

On the contrary, unlike most systems today, our rules are very favorable to both retail investors and employees. Anyone can register their shares for Long-Term voting, not just founders or big institutions.

Re: The Long-Term Stock Exchange Comes to Life

#37

Post by eries »

DennisP wrote: post #10
trothamel wrote: post #4

https://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.…

Seems like it might do a better job of incentivizing long-term thinking if you had to lock your shares, and your vote were multiplied by how long you have to wait before selling them.

I like this idea a lot, and hope to have more to say about it next year sometime :)

Re: The Long-Term Stock Exchange Comes to Life

#38

Post by eries »

sixQuarks wrote: post #34
eries wrote: post #29

Hey everyone, Eric Ries here. I’m the founder and CEO of the LTSE (and also the Lean Startup guy). Happy to see the discussion here and will try and answer a few questions. Unfortunately, a lot of the details of how the LTSE works are subject to regulatory approval, so I can’t share too much while we are working out the details with them. Still, I’ll do my best to answer. Thanks for the comments and happy new year

Eric, this is a very interesting project, I'd like to see this succeed. Be aware that Hacker News has a very negative bent when it comes to new ventures like this. You're going to get a lot of criticism about how this will never work, etc, etc. Go read the Show HN of DropBox to see what I mean. Good luck!

Ha, no kidding! You should see what they say about LS.

I don’t mind, part of being in public with new ideas is putting up with a lot of snark and cynicism. It’s a bug in the human reward system - skeptics are right 99% of the time.

Re: The Long-Term Stock Exchange Comes to Life

#39

Post by runeks »

jerf wrote: post #23
whack wrote: post #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.…

It seems like sufficiently clever lawyering ought to be able to prevent this, by tying the voting power to the entity that has the right to obtain the benefits of the stock price going up. At the very least this prevents the LLC hack.

> […] by tying the voting power to the entity that has the right to obtain the benefits of the stock price going up.

If I own shares in a holding company, which owns shares in an LTSE-company, don’t I have this right? If not me, who else?

Re: The Long-Term Stock Exchange Comes to Life

#40

Post by eries »

startupdiscuss wrote: post #31
eries wrote: post #29

Hey everyone, Eric Ries here. I’m the founder and CEO of the LTSE (and also the Lean Startup guy). Happy to see the discussion here and will try and answer a few questions. Unfortunately, a lot of the details of how the LTSE works are subject to regulatory approval, so I can’t share too much while we are working out the details with them. Still, I’ll do my best to answer. Thanks for the comments and happy new year

My main question is: what is the LTSE? Is it a stock market? Will I be able to buy and sell shares on eTrade or another 3rd party platform? Who will list shares on it? If I had to guess, I would guess it is just like the NYSE except you can only buy and sell shares every 5 years or something.

LTSE = The Long-Term Stock Exchange

Yes, it is in the same regulatory category as NYSE or NASDAQ. Yes it allows you to buy shares of listed companies in all the ordinary ways, including retail brokers.

The best of the next generation of companies :)

Not a bad guess, but not quite right either. Our detailed rules (all 900 pages of legalese!) will be public soon enough.

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