Continuing the Climb: CSE Joins the List of OTC Qualified Foreign Stock Exchanges

2014 continues to be a year of great accomplishments for the Exchange for Entrepreneurs. Earlier this month, the Canadian Securities Exchange (CSE) celebrated the achievement of another key milestone by being named to the OTC Markets Group list of qualified foreign stock exchanges, and in doing so, has opened the door to even greater attention and interest from one of the most popular marketplaces in the US.

Specifically, as a result of this designation, CSE-listed companies are now eligible to apply for trading on the OTCQX and the OTCQB marketplaces. Given the scale and popularity of the OTC marketplaces, the news is certainly creating a buzz among investors and issuers in Canada and the US.

Winds of Change

The approval announcement came just a few days ahead of a visit to Canada by the president and CEO of the OTC Markets Group, Cromwell Coulson.

As part of a campaign to raise awareness about the exchange, Coulson strategically selected Vancouver as the location to talk to industry and media because of the significant concentration of venture-stage companies. Like any savvy investor, however, the timing of Coulson’s visit was just right.

With the passage of the Jumpstart Our Business Startups (JOBS) Act in the US, there have been a number of important barriers lifted for “emerging growth” companies to be able to attract early investors. With restrictions on advertising to certain investors lifted and compelling amounts for capital raising allowed under the JOBS exemptions, there may very well be a catalyst for more active deal making to occur especially for junior and venture stage companies.

A Fine Balance

Given the pace of change that is occurring, however, only companies that can keep up with these changes can truly take advantage of them. One way in which companies can move with greater agility, is in the meeting the regulatory disclosure requirements.

The streamlined continuous disclosure model, recognized by the OTC marketplaces as viable reporting structure, will give CSE listed issuers the opportunity to respond more quickly to emerging funding landscape.

As advocates for reducing complexity, the CSE believes growing companies should be able to focus on growing their businesses and ultimately be more agile in the way in which they run themselves.

The Bottom Line: Being a Qualified Foreign Stock Exchange Opens Doors

The acceptance onto the OTC Market’s list of qualified foreign stock exchanges is a great milestone in a year that has already seen so much positive news and interest in the CSE.

Given the alignment of the CSE’s streamlined approach to cost and complexity, it appears that this could provide emerging growth companies with a strategic edge they need to compete in a quickly changing landscape.

For CSE listed issuers interested in finding out more information about the OTC Marketplaces, here are a couple of resources:

OTC Markets Homepage: http://www.otcmarkets.com/home

Steven Jenkins
Associate
OTC Markets Group
212.896.4414 – office
518.641.8646 – mobile
steven@otcmarkets.com

Keeping it Simple: CSE Unveils Streamlined Trade Execution Pricing

For many in the securities industry, complexity is the new norm. Whether because of technology infrastructure, regulatory compliance or simply keeping pace with innovation, there’s simply just more to manage – everywhere. And, wherever complexity seems to appear, cost seems to show up like a faithful wing-man.

It seems reasonable, therefore, that one promising strategy to lower costs would be to decrease complexity – especially at the trade execution level. At the Canadian Securities Exchange, it is precisely the idea of making the current Canadian securities landscape more efficient that underpins their latest move to simplify access for a key stakeholder in the market ecosystem: the dealer community.

Lower Trade Execution Fees: A Bold Step Forward

As announced in an earlier news release, the CSE is taking a bold step to simplify pricing and access for the dealer community by eliminating the ‘maker/taker’ model and, in its place, implementing equal pricing for both active and passive sides of the trade.

The table below summarizes the new trade execution fee structure as it applies to three tiers of securities trading price. Under this fee structure, both active and passive fees are priced at the same rate on each tier.

Trade Execution Fees

This announcement is a win for the dealer community and for the trading public for two important reasons.

First, with better pricing comes improved participation and better functioning marketplaces. Second, by eliminating the maker/taker price distinction, the playing field has been leveled for liquidity provider and liquidity consumer.

Ultimately, however, the change in fee structure is a natural consequence of the need for innovation. According to CSE CEO Richard Carleton:

As the exchange for entrepreneurs, we are committed to bringing innovative solutions to market operations. We understand that by simplifying the moving parts of the market, we’ve not only lowered industry costs but we’ve enabled wider participation and access to trading of junior public companies.

Getting Noticed

The message of “simpler is better” is gaining traction with many junior public companies. The number of listed issuers on the CSE is up substantially through the first quarter of 2014 and trading volumes are also at historical highs.

While there are still many hurdles to clear, a streamlined and more cost effective framework for dealers is an important step towards making simple the new normal.

The CSE is Exhibiting and Speaking at the Vancouver GreenRush Conference

The CSE is exhibiting and speaking at the Vancouver GreenRush Conference on May 7, 2014.

In addition to exhibiting at the show, the CSE will also be hosting a short corporate presentation at 3:45 discussing the exchange and some of the exciting, recent developments surrounding the marketplace.

Along with the CSE, several CSE-listed companies will be participating at the conference including:

Next Gen Metals Inc.
Lexaria Corp.
Abattis Bioceuticals Corp.
Supreme Pharmaceuticals Inc.

Details of Inaugural GreenRush Conference

GreenRush_graphicFrom the event website:

The conference will feature insightful speakers, government officials, health and industry specialists, public and private companies, fund managers, bankers, brokers, analysts, and media who share a common interest in the Medical Marijuana, Industrial Hemp and Alternative Medicine industries.

GreenRush Financial Conferences’ objective is to provide a platform for venture capital investment, education and business to business opportunities. The conferences will also provide Exhibitors a forum to showcase their products, technologies and services and allow underfunded companies access to capital.

Full details and registration link for the event below:

Vancouver Convention Centre East
Ballrooms A/B/C in the Pan Pacific Hotel
May 7, 2014 7:00 a.m. – 5:00 p.m.

CLICK HERE FOR REGISTRATION

The CSE Quarterly – Issue 1 is now live!

The CSE is proud to present its first ever quarterly publication – the CSE Quarterly – Issue 1 is now live! The publication profiles some of the CSE’s most dynamic listed companies on the exchange, including the following listings:

RESAAS Services Inc. (RSS)
Gener8 Media Corp. (GNR)
Enertopia Corp. (TOP)
Abattis Bioceuticals Corp. (ATT)
Next Gen Metals Inc. (N)
Urbana Corporation (URB)
Brisio Innovations Inc. (BZI)

Click below to access the full issue:

(Trouble accessing the publication below? CLICK HERE TO ACCESS THE ISSUE)

The CSE at the Upcoming Small-Cap Conference in Vancouver

For those in Vancouver, just a friendly reminder that the CSE will be exhibiting at the upcoming Small-Cap Conference in Vancouver along with one of its listed companies – Brisio Innovations.

Pre-registration is free. Here  are the details of the event as provided by the organizers:

The Vancouver Small-Cap Conference – Wednesday May 7th, 2014

Small_Cap_blog_image

We have three excellent guest speakers this year and a solid line up of presenting companies. The last 12 months have been a terrific environment for fundamental investing and we believe many of these companies will continue to produce excellent financial and operating performance.

The Vancouver Small-Cap Conference will be held from 6pm to 9pm on May 7, 2014 at the Vancouver Convention Centre. Presenting companies this year come from a variety of industries including technology, telecommunications, oil & gas, mining, and more.

We are also pleased to announce that Fabrice Taylor, Publisher of The President’s Club Investment Letter, and a regular writer and guest for Globe & Mail and BNN will be speaking at The Small-Cap Conference for the first time. We also welcome back Brent Todd, investment advisor from Canaccord, and Ryan Irvine, Editor at Keystone Financial to provide us with an outlook on the markets and their top picks for the next year. As usual, we are also serving refreshments and have several door prizes to give away at the Symposium.

Admission is FREE with pre-registration. A registration form is available online at www.smallcapconference.ca/register.php. You can also register via email at register@smallcapconference.ca or by phone at (250) 377-1182.

Presenting companies and sponsors include Brent Todd, Investment Advisor – Canaccord Genuity Wealth Management, Arsenal Energy Inc., NTG Clarity Networks Inc., Brisio Innovations Inc., Fabrice Taylor, Editor – The President’s Club Investment Letter, Ryan Irvine, Editor – Keystone Financial Publishing Corp., California Nanotechnologies Corp., Manado Gold Corp., Solarvest BioEnergy Inc., QIS Capital Corp., and the Canadian Securities Exchange.

The complete schedule is now available at www.smallcapconference.ca.

FREE Small-Cap Investment Symposium

The CSE at the Upcoming Small-Cap Conference in Vancouver details:

May 7, 2014
6:00pm to 9:00pm
Vancouver Convention Centre
Rooms 220-222
1055 Canada Place

We look forward to a very successful Spring Symposium Series. If you have any further questions, please feel free to email us at info@smallcapconference.ca or call us at (250) 377-1182. We look forward to your comments, questions, and feedback.

Angels & Devils: The promise and pitfalls of crowdfunding for capital raising

The following views and opinions presented in this post are solely those of the author and do not necessarily represent those of CSE – Canadian Securities Exchange.

Crowdfunding conceptLove it or hate it, crowdfunding looks like it is here to stay. Although the debate on whether crowdfunding is ultimately beneficial or harmful is still ongoing, it appears that major stakeholders from investor groups to securities regulators are beginning to take the idea of crowd-sourced capital raising seriously.

Fairness is a Two-Way Street

Like most promising ideas, the devil, it seems, is in the details.

The spirit of crowdfunding espouses greater access to investing opportunities by smaller, non-accredited investors.  On the other hand, the rules currently in place are designed around curbing widespread participation in “risky” investments.

Striking a balance between investor participation and protection is no easy feat. This balancing act directly impacts industry’s ability to access capital while meeting disclosure requirements.

To be considered as an alternative to current methods of capital raising, crowdfunding needs to be in-line with existing controls on capital raising in a heavily regulated and highly structured capital market infrastructure. After all, the premise is that crowdfunding should increase the ‘fairness’ of market participation.  In the spirit of ‘fairness’ however, that should mean that crowdfunding doesn’t undermine the existing regulatory checks and balances put in place to protect both investors and industry.

Exactly how stakeholders will come to some consensus of balancing participation and protection is still being ironed out. One of the voices in the ongoing conversation about crowdfunding in Canada is the well-respected angel investor, Mike Volker.

A Moving Target

In a recent blog post – entitled “Crowdfunding = Going Public“, Volker presents a picture of an evolving capital-raising landscape in which crowdfunding will essentially mirror the existing landscape but in a much more fragmented way.

Volker’s article highlights the key issues confronting crowdfunding and makes several interesting points.

First, it simply is not fair to exclude investors based their economic standing (ie. the 99%), and that fundraising should be more democratic and inclusive of “non-accredited investors”. (Note the recently implemented “Existing Security Holder Exemption” is a step in the right direction).

In addition, Volker challenges the assertion that fraud is the bigger culprit for investors losing money, pointing instead to businesses failures that plague early stage companies. Simply put, the overriding risk that investors must take-on when making an investment in an early-stage company is that the company or idea simply won’t succeed.

Regardless of fairness or risk,  the main point Volker highlights is that capital is being left on the sidelines as a result of the current system. Non-accredited investors are being held out of the market, due to regulation, and not able to participate in the high-risk, high-reward investments extended to the “wealthy” 1%.

Crowdfunding Hurdles

Letting non-accredited investors participate in earlier stage deals is a key driver behind crowdfunding, but as Volker points out, implementation will be a challenge.

Three points in particular stand out:

  • Share registration and logistics of shareholder management;
  • Standardized continuous disclosure, and
  • Enabling liquidity for investors.

Volker tallies all of the above points and comes to the conclusion that innovations at the stock exchange level, similar to what the CSE has undertaken, could be a good answer to the questions that crowdfunding is trying to answer.

Specifically, with innovation, existing infrastructure can enable companies to efficiently raise growth capital from the public while enabling all investors with adequate, continuous disclosure within a regulatory framework that is fair to all parties involved.

Change is Inevitable

The writing on the wall is clear. There is an appetite by both investors and companies to connect and participate in capital flow in ways that the current system just isn’t providing. Whether this participation need is met by crowdfunding or via existing channels, it is clear that the angels and demons would be better served preparing for change rather than arguing over it.

To read Mike Volker’s full post, click here: http://mikevolker.com/crowdfunding-going-public/

CSE Exhibiting at the Upcoming Canadian Investor Conference 2014

The Canadian Securities Exchange (CSE) is happy to announce that it will be exhibiting at the upcoming Canadian Investor Conference in Vancouver on June 1-2. This show will be a slight departure from the usually scheduled World Resource Investment Conference as it will be broadening the scope of the show across three sectors including resource, technology, and diversified industries.

Vancouver_CC_blogThe CSE is scheduled to be housed at exhibit booth #620. We applaud the organizers at Cambridge House International for organizing a show that presents investment opportunities across several sectors as this is certainly tailoring the show to the appetites of today’s investment community in Vancouver.

It’s early yet, but mark your calendars for this show and we will be sure to see you there. Pre-registration is free by following the link here.

See you in June!