A decades-long dream in Dallas could soon come true. Texas is looking to host its first national exchange.
After raising about $120 million from dozens of individual investors and large companies like BlackRock and Citadel Securities, Texan James Lee launched the Texas Stock Exchange as CEO. According to its current schedule, it hopes that the first transaction will be carried out at the end of 2025 and that its first listings will take place in early 2026.
The Texas Stock Exchange will be a new listing platform for public companies, primarily in the southeastern United States, exchange-traded products and American Depositary Receipts. When fully operational, it will employ 100 workers in the Dallas area.
Although Lee was based in Houston, Dallas was the obvious choice for a national scholarship. It’s a region experiencing a population boom, populated by ultra-wealthy and middle-class citizens, and Dallas is trying to add more companies to its list of corporate headquarters relocations.
Just as D-FW International Airport has brought an unexpected level of prosperity to the region, Lee believes the all-electronic Texas Stock Exchange will do the same, leading to more relocation of headquarters and capital to the region.
The Texas Stock Exchange will work to attract businesses from Texas, Oklahoma and the southeastern quadrant of the United States, including Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi , Tennessee and North and South Carolina.
“We aim to be the third-largest listing venue in the United States,” Lee said. “It’s exciting; it’s transformational. Frankly, this could change the arc of Dallas for decades. It’s the density of this technology infrastructure, the market players and the efficiency of the network that makes Dallas a major financial center.
Among those Lee wanted to thank for this monumental moment was Governor Greg Abbott, who recently rang the closing bell at the New York Stock Exchange. Without his ambition to bring a stock market to Texas, it would have remained a dream, Lee said.
“Without a doubt, the reason we are here today is the leadership of Governor Abbott,” he said. “We were just the team that pulled it all together. We had the right institutional support and, frankly, the right plan and the right people to make this a reality. But it starts with the leadership of Governor Abbott, and it precedes us.
In 2020, the New York Stock Exchange considered moving to Texas when New York state officials discussed whether to tax stock trading through a financial transactions tax. This never came to fruition, nor did the NYSE’s move to the Lone Star State.
Still, the NYSE and its president, Lynn Martin, keep an eye on Texas, viewing it as a powerful economic entity. Texas’ economy, estimated at $2.4 trillion, is the eighth largest in the world, ahead of Canada, Italy and many others.
It also doesn’t hurt that Abbott is a friend of institutional wealth. He supports amending the state constitution to prohibit financial transaction taxes in the future.
Although it will not have a physical trading floor, the exchange will have its headquarters and executive offices in Dallas and will use a Dallas data center. The region is home to about 150 data centers producing 650 megawatts of electricity, according to Real Assets Advisor review.
The Texas Stock Exchange will still have a presence in downtown Dallas with a location that will serve as a physical front for the electronic exchange.
The exact location has not yet been announced, but it will be a place where investors and traders can go to see the latest listing activity, Lee said.
“That’s where you will project, quotes, visibility and business reporting,” he said. “There are a number of co-branding opportunities around our SEOs, and we will host regional and global conferences right here in the heart of the Texas ecosystem.”
Lee and the Texas Stock Exchange have already been in contact with some of Dallas’ largest companies as well as others across the country about listing when they go live, he said.
“This is not just statewide. There are 1,522 public companies in the southeast region of the United States. That’s really our main market for what we do,” he said. “Our approach will create additional alignment between listed and, whether enterprise or sponsored, exchange-traded products. »
Another part of Lee and the Texas Stock Exchange’s pitch for getting companies listed is promising Texas business-friendly stability in the wake of New York’s proposed financial transactions tax, he said.
“In reality, we are simply responding to market demands. We strongly believe in American capitalism and the power of competition in our financial markets,” he said. “This does not mean that we go beyond the limits of existing standards. But we think there is a way to attract more private companies looking to go public by adjusting some of the early growth criteria.
Lee knows it’s a bold move for Texas to create a scholarship. It could radically reshape how and where people invest for years, but to him it’s just business, he said.
“If we take the activity out of the (NYSE and NASDAQ), that’s just part of the competitive process,” he said. “This is a national securities exchange. If we’re fortunate enough to be approved by the SEC, we think we could focus what we’re doing initially in (the Southeast) to capture some of the action in those markets because of the alignment that we’re proposing.
Lee and the Texas Stock Exchange still have a way to go before it’s official. Although it has been working there for years, it must file a registration with the SEC later this year to legally operate as a national securities exchange.
He is confident his group will help make Texas a richer economy with more investment and relocation in Dallas and the state, he said.
“Not a day goes by without someone suggesting getting into crypto, derivatives or any other trading instrument,” he said. “Our goal here is to leverage the unique set of attributes and environment we have and remain focused on building critical mass and tremendous operating leverage as they grow.”
“It’s an exciting time to be in Texas, and especially Dallas.”
