FinClear, the Australian financial services and technology company, today announced the launch of a new digital facility for unlisted securities, FCX.
FCX, which currently hosts FinClear’s own unlisted shares on a digital register, is a DLT-based registry for unlisted securities. Later this year it will add capital raising tools, before opening as a fully licensed liquidity venue with same-day settlement in 2023. FinClear CEO David Ferrall said the venue represented an important step forward in Australian market evolution.
“This is a response to massive demand and need in this market,” he said. “Growing companies find it difficult to raise capital, and equally, institutions and VCs find it difficult to invest in growing companies because of the way unlisted capital has to be structured today. FCX solves for all of that, as well as reducing pressure on young companies to list too early.”
FinClear has appointed Dean Jagger as Head of FCX. Most recently at Automic Group and Link Market Services, Jagger will deliver FCX to market with his deep domain expertise around registries.
“Having managed share registries in every capacity over my career I see FCX as a step change in the way companies issue, manage and raise capital in this country,” he said. “We already have a strong pipeline of companies waiting to bring their registries on to FCX before we launch our capital raising tools later this year. And, of course, I’m most excited for the ultimate goal which we will reach next year when we open our unlisted liquidity venue to participants.”
Significant FinClear investor King River Capital welcomed the development, with founder Chris Barter saying its liquidity potential for unlisted companies could be a game changer for Australian tech as a whole.
“Australia has so much potential as a tech powerhouse, but the market structure does more to hamper it than help,” he said. “There is no junior bourse for young companies; the VC/PE ecosystem is very fragmented; and Government and regulatory structures around startups and scale-ups make it very difficult for investors to exit when they want to without the company listing or diluting capital. FCX addresses all these issues – it could very well become an essential step on the growth journey of successful Australian companies and will be a global first in executing this on blockchain, making FinClear a Web3 pioneer.”
FCX leverages FinClear’s established infrastructure and expertise in listed securities, which has seen it grow to host more than $130 billion on HIN. Ferrall said FCX will support the future of investment, which is moving inexorably toward individual holdings.
“The benefits of individuals holding their investments in their own names on HIN are very well established, and are fit for a lifetime of wealth creation – from young self-directed investors right through to family offices,” he said. “I see a future where unlisted and listed investments are held side-by-side on HIN, and I see FCX playing a part in making that happen.”
As a natural progression to leveraging the HIN and direct ownership of listed securities FinClear has been partnering in ASX’s DLT as a service platform, Synfini. Paul Stonham, General Manager DLT Solutions, ASX, said: “FinClear has been a strong proponent of HIN and developing a platform capability for listed securities that delivers all the benefits of direct ownership (name on register). We look forward to working with visionary industry participants like FinClear to leverage Synfini to create and provide better opportunities for customers.”
