Marketplace for Trading Private Company Shares Looks to Become One-Stop Shop
Forge, the leading marketplace for trading private company shares, has announced its intention to acquire custodial trust company IRA Services for a purchase price of $55 million. This move comes as part of Forge’s long-term vision to become a leading institution in the rapidly growing private markets.
What is IRA Services?
IRA Services is a trust company that provides custodial services for retirement accounts managed by individuals and mid-to-large sized institutions. As a custodian, IRA Services holds onto its clients’ securities and keeps them safe from potential external complications such as theft or otherwise. In addition to holding custody of securities, IRA Services also provides administrative services, such as collecting dividend payments on behalf of clients, and advisory services, including helping clients understand what they can and should invest in.
How Will This Acquisition Benefit Forge?
With the acquisition of IRA Services, Forge will be able to expand its support offerings for private market securities. More importantly, this move brings Forge closer to becoming a one-stop shop for investors looking to trade private company shares. The trust side of the business will transition its name to Forge Trust once the deal closes, better reflecting the custodial services gained through IRA Services and the new company’s full suite of capabilities.
What Does This Mean for Investors?
This acquisition is a significant step towards creating a more seamless experience for investors looking to trade private company shares. With Forge as their go-to platform, investors will have access to a broader range of services, including custodial services and advisory support. This move also positions Forge as a leader in the private markets space, further cementing its position as a key player.
Regulatory Approvals
While the companies haven’t expressed an official expected close date for the deal, Forge expects the regulatory process to take anywhere from two-to-four months. As with any large acquisition, particularly in the financial services sector and particularly in the US, the companies will have to receive the requisite regulatory approvals to complete the deal in full.
Impact on IRA Services Employees
Current IRA Services employees will continue to operate from the firm’s existing offices, ensuring a seamless transition for clients. However, IRA Services CEO Edwin Blue has announced his retirement, effective upon closing of the deal.
Background on Forge and Its Investors
Forge has raised around $88.5 million in venture capital to date, according to data from Crunchbase. The company has backing from several Silicon Valley heavy hitters, including Peter Thiel, Tim Draper, Scott Bannister, Charlie Cheever, and others. This acquisition is a testament to Forge’s commitment to becoming the leading platform for trading private company shares.
Conclusion
Forge’s acquisition of IRA Services marks a significant step towards creating a more comprehensive experience for investors in the private markets space. As the company continues to grow and expand its offerings, it solidifies its position as a leader in this rapidly evolving industry. With regulatory approvals pending, Forge is poised to become an even more prominent player in the private markets ecosystem.
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