The joint venture will be an institutional-grade, centralised secondary trading venue for issuers, brokers, shareholders, and prospective investors.
As part of the deal, Nasdaq Private Market will become a standalone, independent company, which will be strategically backed by SVB, Citi, Goldman Sachs, and Morgan Stanley.
Nasdaq Stock Exchange president Nelson Griggs said: “Since we launched Nasdaq Private Market in 2014, we have created a trusted platform for private companies resulting in a strong track record and robust pipeline of secondary transactions.
“This joint venture will accelerate our opportunities in the private company secondary trading market and establish the standard for technology-driven operational efficiencies, compliance and execution.”
Existing technology, client relationships, and regulatory infrastructure of the Nasdaq Private Market will be leveraged by the JV to rollout a suite of liquidity solutions for private companies.
It will enable private companies, brokers, and investors to access and carry out their private company stock transactions via a global marketplace and personalised technology solutions.
The platform will continue to facilitate private company stock transactions such as buyside book-building, auctions, tender offers, company directed windows of liquidity, investor block trades, and pre-direct listing continuous trading.
Additionally, it will offer full settlement process management and an inter-broker global marketplace through its existing alternative trading system for all customers.
Nasdaq Private Market’s core operating team will continue to work in New York and San Francisco.
Citi, Goldman Sachs and Morgan Stanley said: “Today’s announcement highlights our optimism about the evolution of the private markets.
“We have a long history of jointly supporting market structure innovation and fostering liquidity in the secondary markets.”
Last year, Nasdaq agreed to acquire Solovis, a fintech firm serving institutional investors.