We've seen significant changes in the financial industry in the past two decades. Many of these were due to fintech’s role in revolutionizing the public markets. Think about it: When was the last time you used paper and pencil to buy or sell a stock?
If fintech 1.0 was about innovating the public markets then 2.0 is all about the private markets. While some areas of the alternative investment world still use pen and paper to buy and sell assets, it won’t be for long. The alternatives industry is (finally) having its moment and undergoing a transformation.
Having been part of this industry since the start of the first fintech revolution, I’m ready to usher in this next chapter of change. And, I’m not alone in that. Many fintech leaders are using technology to advance the private markets just like our industry did for the public side.
These six innovators are ones to watch. They’re paving the way for the next era of private investments by offering new products, fostering greater access and providing more options for liquidity:
Henry Ward, founder of Carta. The company’s platform facilitates equity ownership management for private companies. Carta has a valuation of more than $6 billion and the company has become a major player in the private markets. With the secondary liquidity opportunities the company created for its funds, Carta has already made a significant contribution to the alternative investment industry.
Benjamin Miller, CEO of Fundrise. Benjamin is putting his decades-long experience to work driving innovation and optimizing user experience on Fundrise’s platform for investing in commercial real estate. He’s making it easier for more people to invest in alternative assets by employing a model that calls for low fees and low minimums.
Timothy Shannon, president and CFO of CAIS. Timothy is using technology to streamline the buying process, which is opening the door for more people to trade alternative assets. He’s also making it easier for financial advisors to access alternative investment products and strategies, and for more wealth management firms to expand their adoption of these assets.
Patrick Adrian, principal at Nasdaq. Patrick was co-CEO of RedQuarry, the leading fintech provider of research technology. His company was purchased by Nasdaq and now he’s leading the charge of making secondary markets for larger private funds.
I also want to recognize two industry vets on the LODAS team, both of whom are playing key roles in kick starting fintech 2.0.
Annemarie Tierney, founder, Liquid Advisors. Earlier in her career, Annemarie was the general counsel at SecondMarket where she worked with Jeremy Smith, the company’s chief strategy officer. Highly disruptive, SecondMarket focused on providing liquidity for illiquid assets such as fixed income securities, bankruptcy claims and bitcoin. The company was later sold and renamed Nasdaq Private Markets. Today, Annemarie is a member of the LODAS board and Jeremy is our chief operations officer. The two provide valuable insights on how to advance the LODAS marketplace, a paperless way for investors to trade alternative investments and achieve liquidity on their terms.
As the private markets continue to catch the attention of more investors, our standard for success can’t simply be to keep pace with the public markets. Lasting transformation – and relevance – requires us to challenge our existing ways and to offer solutions that keep pace with investors’ changing needs.
Because as these six innovators know, our focus today may be on meeting the demands of fintech 2.0. But 3.0 isn’t far behind.
LODAS Securities, LLC Member FINRA / SIPC - LODAS Securities, LLC is a wholly subsidiary of LODAS Markets, Inc.
The information provided herein does not constitute an offer to sell securities or the solicitation of an offer to buy securities, which can only be made by the applicable offering document filed and registered with the appropriate state and/or federal regulatory agencies and sold by broker dealers authorized to do so. There is no guarantee that a market will develop for some securities, and as a result, they may remain illiquid.