Long-Term Stock Exchange

Eric Ries proposed a Long-Term Stock Exchange, among other ideas, in his 2011 book The Lean Startup.[2] The idea was originally to help companies to raise capital while keeping their focus on long-term instead of short-term results, by giving extra voting rights to long-term shareholders. The idea had little traction and in 2015 he began to set it up himself. Since inception, the LTSE has pivoted to focus on diversity and environmental initiatives.[3]

LTSE filed an application to the Securities and Exchange Commission for registration as a national securities exchange on November 30, 2018;[4] it was approved on May 10, 2019.[5][6]

In its ruling to approve the application, the SEC noted that it had received one comment objecting to LTSE's registration because of its proposed rule concerning corporate governance of listing companies that does not require "one share, one vote".[7]

In reply, the Commission noted that the proposed rules were substantially similar to those at other national exchanges, such as requiring the independence of most directors, committees for audit and executive compensation, and codes of conduct. But the Commission stated that there is no requirement for "one share, one vote", as long as no existing shareholders are disenfranchised. The Commission also noted that the application did not include any provisions for "time phased voting rights", which would have to be approved separately as a proposed rule change in the future.[7]

The exchange launched in September 2020.[8]

LTSE originally intended to not be open to HFTs, and to force companies to have extra voting rights for shareholders, but has migrated from its earlier vision. It still aims to reform capitalism.[9]