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Jeff Thomas: "Private Companies Have Never Had More Options and Better Access to Capital and Liquidity."
Episode 46
Published 4 years, 7 months ago
Description
- Intro.
- (1:22) - Start of interview.
- (1:51) - Jeff's "origin story". He grew up in Dayton, Ohio. He went to Carnegie Mellon University for undergrad "to study engineering and play football." He graduated with electrical and computer engineering degrees, and took off to Silicon Valley. He first worked in the semiconductor industry with Altera. He later got into financial services, first with Gehrson Lehrman Group, then with SecondMarket (early player in the secondary markets for private shares, later acquired by Nasdaq) and Owler (crowdsourcing data on private companies). He joined Nasdaq in 2014 to help launch the Nasdaq Private Market. In 2016 he got promoted to run the listings team for Nasdaq in the west coast.
- (4:39) - Jeff's take on Nasdaq's role and vision: "In the last 5-6 years our approach has been to create a lifecycle approach to supporting our corporate clients: 1) Nasdaq Entrepreneurial Center (early stage), 2) Nasdaq Private Market (as companies scale and need to provide liquidity to their shareholders), 3) Listings Business (for companies going public), 4) Once companies are public, we offer a number of products and services to empower their IR, corporate governance and ESG disclosure practices." Beyond this work with corporate clients, Nasdaq also operates exchanges in the US and EU, it has an investment intelligence business (indexes, sell market data) and it's a technology provider to capital markets (including market surveillance technology, AML/KYC solutions, and others).
- (7:38) - Jeff's take on growth of IPOs during the pandemic (~250 operating companies have gone public in Nasdaq this year) and SPACs (there have been 495 IPOs in 2021 raising ~$138bn). "As a private company you've never had more options and better access to capital and liquidity." Private companies can raise: 1) Late stage venture capital rounds ("there seems to be $100m rounds everyday"), 2) IPOs, 3) SPACs and 4) Direct listings.
- (10:13) - His take on the impact of government actions on the economy (and how they impact markets). The acceleration of digital transformation during COVID-19.
- (12:39) - His take on the Nasdaq Private Market (facilitated ~$36 billion in transaction volume for ~500+ private companies) and why they decided to spin-off NPM as s stand-alone company, receiving investments from a group of banks including Citigroup, Goldman Sachs, Morgan Stanley, and SVB Financial Group.
- (16:05) - The "stay private or go public" decision per Jeff: "It all boils down to the company's goals and objectives in different phases of its lifecycle." Companies go public for a variety of reasons, but some of the primary ones are: 1) to raise capital, 2) to provide liquidity, 3) brand enhancement (prestige) of being a public company, and 4) to leverage its equity as an acquisition currency.
- (18:53) - His take on regulatory pressures on private markets (particularly from the SEC, as explained by Commissioner Lee's speech on "Going Dark" and problematic asp