January 11, 2022

Bringing dynamic liquidity options into the private market

From day one Syndex set out to facilitate a private market that was fair and transparent - a more investor-centric way of investing. One core element of this has always been to offer secondary market functionality for our issuers and their investors. While investors understand that investments are not for the short term, in reality, there needs to be effective mechanisms in place when an exit might be required. 

As we celebrate the growing pool of private-market-interested investors the need to market an attractive investment product is heightened. These investors are accustomed to liquidity in the public markets; perhaps under-appreciating it until it isn’t there.  To remain competitive, Issuers need to get ahead of the competition and add liquidity to their story. This also applies to companies wanting to remain attractive to their shareholders and/or competitive in their employee benefits. When Issuers are ready to prioritise liquidity they need solutions that suit their needs. Syndex has these options.

Our long-standing peer-to-peer secondary market functionality has achieved what we set out for it to do and participating investors have experienced better price discovery and liquidity as a result. However, one barrier to this 'continuous market' felt by some Issuers was the need for continuous disclosure. The secondary markets rely heavily on the disclosure of both quantitative and qualitative information which is often a time-consuming requirement for small management teams. 

Faced with this conundrum, we have found the solution in the form of trading events or auctions - 'periodic market'.  This customisable market is suitable for shares, units, commodities or other proportional investments. These events open, and then close, within a defined period where investors have been recently updated by the issuer with all information necessary for an investment decision - ideal for businesses wanting to time information releases. The defined and concentrated auction period drives high participation and activity. There is a pre-auction registration and approval of participants, allowing Issuers to set the privacy levels on an event. 

For optimum user experience, the facility integrates with the Syndex investment management system and investor portal creating a full-service model. From start to finish auction participants receive the auction invite, period disclosure information and settlement statements. 

This innovative product is out in the marketplace now, with Jarden being our first periodic market customer. 

Our ‘continuous market’ is still here to stay - there is a place for both of these versions of the secondary markets, we're excited to bring a new product to the private markets that can revolutionise liquidity.  Issuers now have the opportunity to offer enhanced liquidity in an exclusive trading event that, despite tighter Issuer control, favours investors. 

At Syndex, we’ve set about overthrowing the barriers that have historically plagued the private markets and we think we’ve just crushed a really big one! 

Read more about our liquidity options and to see a demo of the periodic market click here.

Ross Verry

Ross Verry is CEO of Syndex and a shareholder. The views expressed above are purely his own. Please assess and research all your investment.

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