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The U.S. government on Friday approved the formation of a new Silicon Valley stock exchange following a regulatory criticism late last year. The net new exchange intends to help companies go public while alleviating scrutiny and demands over near-term profits.
Prior filings indicated that a key aspect of the exchange could include scaled voting power the longer an investor holds a stake in a company. Firms listed on the exchange may also required to abide by certain rules, including a ban on tying executive pay to the company’s short-term financial performance. “It sounds too good to be true for people out here,” said Ries about the exchange’s mission. The exchange filed with the Securities and Exchange Commission on Nov. 9, though the company faced criticism by Commissioner Robert Jackson Jr., who said the structure of the exchange could grant founders and early investors in startups excessive power at the expense of other shareholders, according to a Wall Street Journal report.
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