Stock Exchanges Timeline
The economic history helps you understand the present much better. For instance, you cannot realize why bank loans are a capitalization method more problematic than the risk capital, for startups, if you don’t know that the Dot Com Bubble and the 2007 Crisis have dramatically harshened the loaning conditions of the banks. Starting from this idea, I have made up a timeline of the setting up and development of stock exchanges. Assets started to be traded as far back as the Roman Empire, but after the Middle Age, economic innovations have precise dates.
- 1460: The First Stock Exchange in the World, in Anvers. It traded mostly bonds, but it was also a meeting place for those who lent money and officials.
- 1602: The First IPO (Initial Public Offering), for the Dutch company of East Indies. It was a megacorporation avant la lettre, specialized in maritime trading and transports with the East and Africa, an organization which also had military power.
- 1801: London Stock Exchange – LSE. The first share offering occurred there in 1825. Also at that time, there is recorded the occurrence of some abstract deeds, which made successive transfers possible, after for a long time practice had only allowed specific agreements between traders who had known each other.
- 1817: New York Stock Exchange, based on the model of the Philadelphia Stock Exchange, the first one founded in the USA. NYSE has been operated in the current building since 1865. The London and New York stock exchanges became in the first part of XIX century the main pillars of the international financial system. Currently, the New York Stock Exchange is the most powerful in the world, with a total capitalization of over $ 19 trillion and the NYSE composite index is considered the most relevant in the world, thanks to the quality of the companies considered and the huge volume of deals.
- 1878: Tokyo Stock Exchange, the core of what would become in 2013 Japan Exchange Group, further to successive mergers, of which the last one being with the Osaka Stock Exchange. The unofficial name is still the Tokyo Stock Exchange. It is worth mentioning the late date of founding, started in 1850, which is related with the accelerated modernization of the Nippon Empire. The Tokyo Stock Exchange, is the fourth most powerful in the world after New York, NASDAQ and London.
- 1891: Hong Kong Stock Exchange, operational under this name since 1914, after it had been founded in 1891 under the name of Association of Stockbrokers in Hong Kong, against the background of the prosperity related to the statute of enclave of the British Empire. The reputation of global financial center has remained unchanged after the transfer of sovereignty from the UK to China in 1997. Besides the volume of deals, the Hong Kong Stock Exchange distinguishes itself by a high number of IPO.
- 1929: The Crash on Wall Street. The most severe crisis in recent history started because of an excess of speculation of the assets. Due to the prosperity of the twenties, most stocks and other values were constantly appreciating, up to prices that proved unsustainable.
- 1971: NASDAQ, the first electronic stock exchange (National Association of Securities Dealers Automated Quotations). After launching, it has made its brokers unhappy as a result of the decrease in the margin between demand and supply, triggered by the electronic trading. The same decrease, however, has made the market more dynamic, because it has been in favor of the investors.
- 1990: Shanghai Stock Exchange. With a tradition going back to mid XIX century, the fifth most powerful stock exchange in the world ceased operations after the instatement of communism in China.
- 2000: Euronext, a pan-European stock exchange, created by the mergers of the stock exchanges in Amsterdam, Brussels and Paris, with operations in the three cities and in London, Lisbon and Dublin. After a complicated history of mergers and acquisitions, it has become the second most important stock exchange in Europe, after the one in London. It has a creative strategy, which encourages the financing of small and medium size companies, by operations called Alternext and Enternext.
Over the last decade, I've built my professional life as an investor, focusing on 3 key areas: financial services, real estate and tech startups. I’ve participated in the setup and development of two major fintechs, and after those two successful exits I’m now directing my resources into building a new enterprise in this area – the Key Way group.
I've started, participated in and developed companies in Romania, as well as Bulgaria, Hungary, Czech Republic, Germany, the UK, Mexico, Dubai and South East Asia. I'm constantly looking for new segments, new markets and new opportunities, and therefore I interact regularly with the regulator institutions and official agencies in various countries and markets.
The most recent example is the GCC area (Gulf Cooperation Council - Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates, and Saudi Arabia). I started to research opportunities in that area at the end of 2018 - more specifically, the United Arab Emirates, which are establishing themselves as one of the most dynamic markets in the world.
The whole experience of working with the official institutions there was a great example of how to attract and encourage investors! ADGM, the Abu Dhabi Global Markets regulator, was established quite recently and I was absolutely impressed with their professionalism.
To start off, I researched the local market regulators online. The information was clear and easily available: I contacted them online, via their website and LinkedIn accounts. They responded promptly, and in only a few days, we set up a series of meetings with the financial markets regulators in both Abu Dhabi and Dubai!
The ADGM gave me full support and very clear, detailed information on what and how I need to do to obtain a trading licence in financial services in the UAE. I met with representatives from both the ADGM registration department (where all new businesses have to register before they acquire a licence for online trading) and from the FSRA (Financial Services Regulatory Authority).
They were very clear on the procedure, steps to follow and criteria we need to meet, which is a fantastic help for an investor on a new, highly regulated financial market.
In a few days I started the onboarding procedure - everything happens online, everything is digital, everything is set up for maximum ease and transparency.
They set investors up for success, but they make sure they vet them thoroughly as well! A "user friendly" approach does not mean lower standards, quite the opposite - they made sure I meet all commercial and business criteria, they assessed my financial, capital and business status and previous experience, and checked references from markets in which I operated previously.
We went through a process of very rigorous assessment and due diligence, and several meetings where I detailed our business plan and long term vision. Professional but friendly - you feel welcome, encouraged and supported as an investor.
Furthermore, their “enthusiasm”, or appetite for new business, equaled mine! They’re happy to welcome new businesses, they work hard to attract them and to set them up for success. I was very impressed that they genuinely appreciate the fact that investors, however big or small, choose their market to set up a company.
I’d love to see this same level of energy, hard work and appetite for business in my home country, Romania.
While other jurisdictions welcome investors and work hard to create the framework for development and success, I often feel that the Romanian regulators, for financial markets and not only, start from a default position of suspicion or, at best, indifference. Investors are regarded with thinly veiled (if at all veiled!) suspicion and distrust and sometimes downright hostility, you almost feel guilty or embarrassed to be successful financially.
I hope to see this mentality change in Romania, because I, as well as most Romanian entrepreneurs I know, really want to make our country a top choice for investments, not just in outsourcing and services. We want to make Romania known for its know how and creativity.
I think Romanian regulators should remember that their whole purpose of existence is to enable business, not hinder it. And as investors, especially once we see best practices from other jurisdictions, we need to remind them of this reality.
- Fintech OS - B2B services and TaaS enabling automation for financial services. The fact that this is a Romanian company that has achieved such rapid growth proves that (to paraphrase) geography is not destiny. Their experience is inspiring.
- Fagura - P2P Lending. Although Fagura is actually coming from Moldova, they are present in Romania. This is a friendly peer-to-peer platform, modelled on UK similar companies. I think it has good potential for success.
- Smart dreamers – a platform for recruitment marketing automation, they’re already in the UK, the US, and Singapore, with enterprise-ready software that helps companies reach and engage with potential candidates online.
- Medjobs – this is a platform for recruitment and jobs in the healthcare sector. I like their focus and the fact that they’ve honed in on this very specific opportunity, as it is a very dynamic niche and was generally very fragmented.
- Typing DNA – such an original idea! They’ve developed an app for typing biometrics authentication – recognizing people from the way they type, this is an AI-based solution for risk-based authentication and fraud prevention.
- Competitors.app – a very useful and comprehensive app for monitoring competitors’ marketing activity across online channels.
- Finqware – this was badly needed in Romania, since most companies and people have several bank accounts and they need a centralized dashboard for their finances.
- Keez – A user-friendly alternative to accounting, payroll, and ERP software.
- Teleport HQ - An AI powered platform and suite of open source tools which simplifies UI building and adds realtime optimisations by analysing user's intentions.
- Cyscale - a Multi-Cloud Platform, for all major providers like Amazon, Google and Microsoft, which handles Cloud Native Security, Threat management and Secure Cloud Design.