Nasdaq is buying a stock exchange for shares of private startups

Nasdaq has acquired SecondMarket, an exchange for shares of privately-held companies, in a bid to broaden the scope of its offerings.

With an increasing number of technology startups remaining off public markets, SecondMarket offers a venue for employees and early backers to buy and sell their shares.

"As companies extend their pre-IPO lives, they face increasing pressure to provide liquidity to employees and early investors," Bill Siegel, CEO of SecondMarket, said in a statement.

SecondMarket was founded in 2004 and became popular in the years leading up to Facebook's 2012 Initial Public Offering. The exchange attracted venture capitalists and startup employees alike who were looking to sell shares in private companies to outside investors, including hedge funds. Eventually, many Silicon Valley startup adopted policies restricting employees from private stock exchanges like SecondMarket.

NASDAQ, which also began experimenting with blockchain technology earlier this year, is taking all of SecondMarket's employees as a part of the deal. SecondMarket has raised more than $30 million in venture capital backing.

Barry Silbert, its founder and chairman, left the company last year to lead a Bitcoin-focused startup.
Terms of the deal weren't immediately available.

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