(Previously Ranked 7) In May, Liquidnet inaugurated trading in Estonian and Lithuanian stocks, bringing the number of equity markets on its institutional trading network to 34. Launched by serial entrepreneur Seth Merrin in 2001, Liquidnet serves 598 members and as of April was trading 66 million shares a day, at an average 45,922 shares per execution.
Total international traded principal that month amounted to $10.1 billion, 39 percent more than in April 2009. The continual expansion is sweet vindication for CEO Merrin, 50, who built the business on a belief that the buy side would trade big blocks more efficiently in a shared liquidity pool than on exchanges, where small lots had become the norm.
Thanks to his track record — Merrin had previously started and sold order-management systems innovator Merrin Financial and application software developer VIE Systems — he was able to raise $19.5 million to fund development of Liquidnet between 1999 and its April 2001 opening. By June 2002 it had 100 members, and five months later it launched in Europe.
Last year Liquidnet formed an equity capital markets group to address market inefficiencies in a different way. “Issuers want access to our self-filtering membership that excludes high-frequency and day traders,” says Merrin.
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