Euronext drives new opportunities for startups

This streamlining and commitment from Euronext will become an important accelerator for one of the most decisive goals for nBanks in the future.

Euronext, the company that manages the Lisbon stock exchange, has as a strategic priority for the next three years to invest in startups, facilitating their entry into the stock market. To this end, it will establish partnerships with private equity and venture capital firms.

This streamlining and commitment from Euronext will become an important accelerator for one of nBanks' most decisive goals: to take another step forward into the future, through an IPO (Initial Public Offering) operation within the legal and mandatory procedures.

Euronext's communication, according to the newspaper Eco, thus refers to 3 important measures to be implemented in the future:

- create, still this year, a new green debt segment (Green Bonds); - define a new range of Post-Trade services.

1. Partnerships with private equity and venture capital firms

These partnerships aim to use a cooperation model that allows more startups to follow the path of the capital market. In this regard, as soon as private investors want to exit the capital of startups, the option of going public now arises. One of the measures of this partnership aimed at startups will be based on sharing market information for each company and market.

The creation of an area between public and private markets is planned (similar to the Norwegian stock exchange, which foresees a market reality for unlisted companies) where solutions not subject to regulated markets will be explored, thus creating options for companies and investors to meet simply and at lower costs.

2. The new Green Bonds segment

By combining Startups with Euronext's focus on the equity market, the priority in debt now becomes sustainability. This new segment facilitates the issuance of green bonds, which consist of assets with specific criteria for financing sustainable projects, and is also accompanied by a distinctive training program and a guide for recording non-financial information.

In Portugal, there are only four issuers of green bonds: EDP on a large scale, the Pestana Group, and Sociedade Bioelétrica do Mondego. However, an increase in future emissions is expected, due to growing market demands.

Thinking of investors, and the projected high adherence to this model, Euronext foresees the creation of new sustainability indices to respond to the increase in passive investment.

3. The development of Post-Trade services

Another strategic focus is the creation of a comprehensive infrastructure across all European countries with the ambition of becoming a market leader. Differentiating itself by the new services it intends to offer, Euronext thus ceases to be a simple stock exchange manager by starting to implement Post-trade with settlement, securities custody, and clearing services.

By expanding its business model, Euronext continues to diversify its service for listed companies, investors, and market members through new acquisitions.

In this way, the adopted strategy of establishing partnerships and acquisitions, carried out by obtaining other exchanges, strengthens the growth of the service base for complementary structures and companies.

Mateus Ferreira, L. (2019). "Euronext vai aliar-se a capital de risco para captar startups para a bolsa." Eco, [online] pp.https://eco.sapo.pt/2019/10/14/euronext-vai-aliar-se-a-capital-de-risco-para-captar-startups-para-a-bolsa/. Available at: https://eco.sapo.pt/ [Accessed 19 Oct. 2019].

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