New stock exchange MEMX gets Citigroup as latest investor

By Tom Auchterlonie · June 12, 2020

Members Exchange is receiving an investment from Citigroup, making it the latest big financial institution to become a shareholder in the new stock exchange.

MEMX CEO Jonathan Kellner first revealed the investment in a Thursday blog post on the company’s website.

“Although we recently closed our latest round of financing and are focused on launch, we didn’t want to pass up the opportunity to add another significant market participant to our list of supporters,” Kellner stated. “We look forward to working with the Citi team and leveraging their market structure expertise.”

Kellner did not disclose terms of Citigroup’s investment in his post. Representatives for MEMX and Citigroup declined to comment on investment details, such as the amount of capital being contributed, Citigroup’s equity stake and MEMX’s latest valuation

The announcement came roughly a month after MEMX disclosed a previous investing round, which involved BlackRock, Wells Fargo, Williams Trading, Manikay Partners and Flow Traders. The May round, according to MEMX, brought in more than $65 million in new capital, or a total of more than $135 million since the company’s inception.

The company, which was launched in January 2019, has raised capital from a slew of prominent financial firms. Companies that invested earlier include JPMorgan Chase, Goldman Sachs, Bank of America, Fidelity, Charles Schwab, Citadel Securities, Jane Street, Morgan Stanley, E*TRADE, UBS, TD Ameritrade and Virtu Financial

Kellner, in his Thursday blog post, also said that the Financial Industry Regulatory Authority has approved the company’s routing broker-dealer, which is called MEMX Execution Services, LLC.

MEMX’s chief added that the exchange’s launch is planned for Sept. 4. In addition, Kellner gave an overview of the scheduled timeline leading up to the launch, which will include the start of platform testing on June 29, the start of member certification on July 13, a first user test acceptance on Aug. 1 and a second user test acceptance on Aug. 15.

“MEMX is now working with more than 50 participants to onboard or connect to our market, ensuring that these firms will be prepared for day one and putting us on track to launch with a truly diverse set of liquidity,” Kellner stated.

The company received approval early last month from the U.S. Securities and Exchange Commission to operate its exchange. MEMX is seeking to break into a market that is concentrated; according to the SEC, most of its approved exchanges are run by the New York Stock Exchange, Nasdaq and Cboe. 

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