The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas International Securities Exchange (BISX) is aiming to launch its small company/microcap listing facility before year’s end, its chief executive yesterday saying: “A lot of people are anxiously waiting for this to move forward”.

Telling Tribune Business he had “not encountered one person” who felt the initiative was a bad idea, Keith Davies said the facility - targeted at companies and start-ups seeking to raise $1 million or less in capital - would ultimately become “a major part of the infrastructure fabric” of the Bahamas.

Disclosing that BISX had made progress in “sorting out the structure” for its ‘small market’, Mr Davies explained that the facility would provide small businesses and entrepreneurs with an alternative capital raising mechanism - diversifying away from traditional sources such as commercial bank financing and funds from family/friends.

The BISX chief executive added that the exchange had talked to the London Stock Exchange (LSE), and visited other smaller exchanges to see how they had structured their microcap markets, in a bid to learn from them and develop a uniquely Bahamian model.

“The progress made so far is the structure and surrounding infrastructure,” Mr Davies told Tribune Business. “That’s what we’ve been looking for, and what we’re focusing on. We’ve been doing a lot of legwork.”

Explaining the research focus on both large and small global stock markets, Mr Davies added: “You try to find the best of both worlds, and try to meet in the middle with BISX.

“I don’t like to model after anyone, but we do our homework.”

Asked about the demand for the proposed BISX microcap facility, and how any inquiries he had received, Mr Davies replied: “A lot. I can confidently say that people are anxiously waiting for this to move forward.

“People really want it to be successful, and we want to deliver something that will be useful to the market and that people will want to be part of.”

He added: “We’re dealing with start-ups and small companies. The vast majority of the population are employed by small businesses. I have not encountered one person who has felt this is a step in the wrong direction.

“They are asking: How can I benefit? How can I participate? I’m encouraged by the fact people want to see this facility come forward, but I want to make sure than when it comes out of the shop it has the elements to be useful to persons.”

While more interested in getting BISX’s microcap listing facility “right”, rather than speed or meeting a timeline, Mr Davies told Tribune Business: “We’re looking to hopefully before the end of the year to have something that looks like a small market.”

Acknowledging that the facility had to meet with the approval of both market participants and the Securities Commission, the BISX chief executive said it would give small businesses the ability to raise capital via equity (selling ordinary shares), or through debt offerings such as corporate bonds or preference shares.

“It provides an alternative avenue, and a venue for seeking to raise capital,” Mr Davies explained. “You’re giving people choices, where they can lower the cost of acquiring that capital, getting to market much more quickly.

“We want to challenge the entrepreneurial spirit we have in this country. A lot of people in this country have ideas, but they need to now try to put it in paper. It needs a channel.”

By joining, and listing, on BISX’s small market, businesses and entrepreneurs will also gain greater exposure and establish a track record, adhering to corporate governance principles and other qualities that could stand them in good stead for future growth.

Emphasising that he was looking for the planned microcap listing facility to grow organically, following his philosophy of growing BISX in “small, positive incremental steps”, Mr Davies added: “That’s the way things grow, and eventually I see this being a major part of the infrastructure fabric of the economy. Absolutely. No doubt.”

He told Tribune Business that, ultimately, the facility “could go international”, attracting investors seeking to be part of a venture capital fund.