LOS ANGELES (Reuters) - Seeking to breathe life into the bleak fund-raising environment for clean technology companies, a new private exchange wants to make it easier to invest in promising biofuels, solar or other green start-ups.
Known as GREENDAQ, the new exchange goes live on Wednesday at www.greendaq.com. It claims to be the world's first equity and commodities exchange created exclusively for the green technology sector.
Chief executive and founder Andrew McLean said GREENDAQ will provide a key benefit to investors who might be wary of pouring cash into new technologies -- allowing them to trade the shares of start-ups.
“We are offering them a way to have liquidity in the early stages in the investment process,” McLean said in an interview. “From an investors’ point of view you are getting excellent global deal flow and an opportunity for liquidity. Otherwise you invest in a private company and you have no liquidity.”
Companies will be vetted before they are listed, McLean said. He expects to have 5 companies listed in the next two months and 20 companies or green commodities listed in the exchange’s first 12 months.
The first company listed will be a British maker of jatropha-based biofuels, Carbon Credited Farming Plc.
For equity offerings, McLean expects the minimum investment will be about $100,000.
The exchange also plans to list “new classes of commodities” it calls green oil, green energy and green lumber, McLean said. Green oil units could go toward raising capital for a plantation of cellulosic material to produce biodiesel, for instance.
The exchange is not open to the general public. Investors must apply to become members of the exchange and, once approved, will have access to GREENDAQ’s full range of offerings. The exchange hopes to have 10,000 investment professionals registered by the end of its first year.
Aruba-based GREENDAQ will generate its own revenue by charging fees for companies to list and for investors to execute trades.
Reporting by Nichola Groom; Editing by Andre Grenon