The Texas-based TXSE Group, backed by investors like BlackRock and Citadel, is planning to launch a new national stock exchange to compete with the New York Stock Exchange and Nasdaq. With $120 million in funding and support from over two dozen investors, TXSE aims to provide an alternative for investors and corporations seeking to trade and list equities. The group plans to file for registration with the SEC later this year and hopes to launch the exchange in 2026. They aim to benefit from the large number of private equity-sponsored companies in the region that may be looking to go public.
The number of public companies in the US has declined by over 50% since the 1990s, with many companies choosing to stay private due to factors such as reporting requirements, litigation expenses, regulations, board governance, shareholder activism, and quarterly earnings pressure. There are now significantly more private equity-backed firms in the US than publicly held companies. TXSE hopes to help alleviate some of the burden on companies considering going public by providing a stable and predictable alternative for listing standards and associated costs. The exchange would primarily focus on listing businesses located in Texas and the southeast quadrant of the United States.
The trend of companies staying private has been growing for some time, with firms choosing to avoid the regulatory requirements and costs associated with going public. The average US technology firm now takes 11 years to transition to the public markets, compared to four years in 1999. JPMorgan Chase CEO Jamie Dimon expressed concern about this trend in his annual shareholder letter, questioning whether it is the desired outcome. The TXSE Group aims to provide more access to US capital markets for all investors while offering greater alignment and opportunities for public companies and those seeking public capital.
The TXSE Group’s planned national stock exchange comes at a time when changes in the equity markets are creating opportunities for greater alignment and competition. The group hopes to expand access to US capital markets and provide stability and predictability around listing standards and costs. The exchange would join the approximately 13 stock exchanges in the US, with most of them located in New York City. TXSE would primarily focus on listing businesses in Texas and the southeast quadrant of the country. With support from major Wall Street players and a well-capitalized launching plan, the exchange aims to be a significant player in the national stock market.
In conclusion, the TXSE Group’s plans to launch a new national stock exchange based in Texas represent a significant development in the US equity markets. With major financial backers and a focus on providing an alternative for companies considering going public, the exchange aims to address the challenges and costs associated with listing on traditional exchanges. As the trend of companies staying private continues to grow, the TXSE Group hopes to capitalize on the demand for expanded alternatives in the market. The exchange’s launch in 2026 could potentially change the landscape of the US stock market and provide new opportunities for investors and businesses in the region.
