Dream Exchange: A financial Marketplace Built on Equality of Access, Ethics and Humanity
When IPC Systems announced in April 2023 that it was partnering with the Dream Exchange, a timely and ambitious US initiative to launch the first minority-owned (and governed) registered stock exchange in the history of the United States, Mike Smith, Director of IPC Network Services said, “IPC is privileged and excited to be part of Dream Exchange’s vision and mission to increase participation in capital markets across all sectors of society.”
Dream Exchange first came about in 2015, when its Founder and Chief Executive Officer (CEO), Joe Cecala, sought to harness the traditional purpose of stock markets as a capital–raising venue rather than a secondary trading apparatus.
Over time, the company’s mission has expanded to encompass the creation of the first minority-owned and governed registered stock exchange, ushering a new generation of entrepreneurs from all sectors of society into the traditional financial market system. Specifically, Dream Exchange is in the process of obtaining US regulatory approval for a National Market System (NMS) stock exchange and is preparing its formal application to register as a national stock exchange. When approved, it will be the first minority-owned and governed exchange in the country.
IPC Systems has been a pivotal technology partner to Dream Exchange and instrumental to its progress to date building the physical infrastructure that will underpin its upstanding objective and leveraging its technological expertise and 50-year reputation in financial services to establish a fast and efficient exchange venue, with fair pricing, that will encourage much more inclusive access and membership. Dream Exchange will also benefit from IPC’s award-winning connectivity and cloud solutions, key market data sets, and most importantly for potential Dream Exchange members and users, efficient onboarding and cost-effective access to this new and unique financial marketplace.
However, Dream Exchange’s plans do not stop there. It also wants to establish a venue – a venture exchange – that targets the entrepreneurial and small to medium-sized company (SME) segments under-served by traditional channels for capital raising and investment. Dream Exchange recognizes that these entrepreneurs and SMEs are the backbone of society. It believes that supporting more accessible investment in those that create new ventures ultimately creates wealth and employment in local communities. Since the late 1990s, the total number of publicly (listed) companies on US exchanges has declined by nearly 50%, and the number of small initial public offerings (IPOs) has fallen from 70-90% of all IPOs in the 1990s to just 5-20% of all IPOs today, according to a white paper co-authored by Founder and CEO Joe Cecala.
At the same time, over 140,000 businesses, employing some 1.3 million people are owned by Black Americans (according to the estimates provided by the US Census Bureau’s 2021 Annual Business Survey, which covered reference year 2020). That is one of the reasons that the Dream Exchange is committed to creating a new venture exchange – after the launch of the NMS exchange – specifically to champion the success and growth of early-stage small and medium-sized companies through listings and facilitating funding/capital investment. Through an innovative Venture Exchange model, Dream Exchange’s objective is to enable more of these businesses to access capital (investors).
This admirable objective is in furtherance of the Main Street Growth Act (which when passed into law will enable stock exchanges to be designed specifically for small and early-stage businesses), and supportive of organizations like the Minority Business Development(MBDA) and the National Alliance of Black Business (NABB), who are signatories to a Memorandum of Understanding with the US Department of Commerce to collaborate and share data in order to raise awareness about initiatives affecting black-owned businesses. Dream Exchange intends to be an active participant in this initiative since it shares many of Dream Exchange’s objectives.
“This is a critical time to influence public policy and to share progress, not least on our plans to open the first majority black-owned stock exchange,” said Dream Exchange CEO, Joe Cecala. “Our goal has always been to empower innovators with access to capital, regardless of what they look like or where they come from. This is not about soundbites and platitudes, it’s real-world action for positive change.”
Dream Exchange has been a strong advocate for the Main Street Growth Act from its inception, recognizing that regulated marketplaces, like stock exchanges, offer investor protections that are simply not available in the non-regulated space – for any size of company, but particularly for smaller more vulnerable businesses. This is exemplified as we view the aftermath of FTX and Silvergate, which left many investors with empty pockets and a bad taste in their mouths about speculative investment. These debacles have caused heightened investor focus on transparency and trust in financial markets, generally, and in the US financial markets in particular, resulting in industry regulators to set their sights firmly on the burgeoning crypto and digital assets industry.
Dream Exchange seeks to leverage the transparency, trust and protections offered in the time-tested, regulated, stock exchange mechanism – and its commitment to creating a more level investor playing field – to enable good companies, with innovative ideas, to get the capital investment they need to thrive and grow.