Singapore-based crowdfunding platform FundedHere launches private stock exchange that enables investors to trade from startups and private firms directly.

Victoria Sek  |  Singapore
Published 2018-08-01 12:25:53

Update [3 August 2018]:

In another statement released yesterday (2 August), FundedHere retracted their earlier clarification on FundedX.

This is their statement in full:

“FundedHere wishes to retract its earlier clarification as it has discovered that it is factually incorrect to state that the business model that FundedX intends to engage in is licensed under FundedHere’s capital markets services license.”

“FundedX will be required to be an approved exchange or a recognized market operator in order to do so. FundedX will refrain from operating until it has received the relevant authorisation to do so.”

Their earlier clarification was that FundedX “is a market operator and therefore has a license as either an approved exchange, a Registered Market Operator (“RMO”) or an Exempt Market Operator (“EMO”)”.

The company had stressed the platform is for buying and selling a particular company stock at a pre-determined price set by FundedX, and buyers and sellers will not be able to negotiate on the share price of the company.

Their clarification statement said that “secondary broker platform” or “matching platform” is a closer definition of FundedX’s operations.

FundedHere, Singapore’s first crowdfunding platform that offers equity and debt deals for companies, announced Tuesday (31 July) the launch of FundedX.

FundedX is described as a private stock exchange that helps make the trading of shares of high-growth startups and privately-held companies in Southeast Asia (SEA) easier.

They explained that the “process of buying and selling shares can be quite tedious” as individuals have to liaise personally with intermediaries, company secretaries, and share registrars.

With FundedX, they hope it can be an exchange platform for SEA’s markets where investors can find more opportunities and shareholders of private firms have access to more liquidity options.

private stock exchange
Daniel Lin, Co-Founder and Executive Director of FundedHere / Image Credit: FundedHere

Daniel Lin, Co-Founder and Executive Director of FundedHere, said, “FundedX is a game changer that will help to bring much needed liquidity to the private market.”

“We see this new platform as a complementary and natural extension of FundedHere’s current offering that will support yet another key stage of the funding cycle for emerging companies.”

The exchange links up companies to a global investor base, appraises shareholders and interested buyers, does administrative work, and provides a transaction framework.

FundedHere, a Monetary Authority of Singapore (MAS)-approved crowdfunding platform, plans to integrate smart contracts run on blockchain into the process as it’s safer and cost-effective.

According to them, legacy shareholders such as former employees and early investors can monetise their returns through FundedX.

Employees with stock options seeking partial liquidity can submit a verification of ownership to take part in the exchange as well.

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The statement added that interested investors can submit buy requests which will be processed through FundedX’s algorithm to match transactions.

After shareholders and investors are matched, the company whose shares are being transacted, will then need to approve the sale and deal terms for the transaction to go through.

FundedX’s goal is to have the matching process completed within two weeks.

FundedHere revealed that several investors, companies, and shareholders across SEA has shown interest in participating on the platform, and intends to go live with its first transaction within three months.

Darius Cheung, Founder and CEO of 99.co, said, “This comes at a great timing as some of these investors of private unicorns would be sitting on a huge paper gains and can now actually realise them.”

Featured Image Credit: FundedHere

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