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Financial Software - Wednesday, September 19, 2007

Pequot Takes Minority Stake in Restricted Stock Partners

restricted stock.png
NYC-based Restricted Stock Partners says it has secured Series A funding from Pequot Ventures. The startup operates a proprietary electronic trading platform or Restricted Securities Trading Network (RSTN) that is currently in beta with 300 institutional users.

Restricted securities are commonly issued through private placements, corporate mergers and reorganizations, and as compensation. But as their name implies, they present liquidity blocks that the RSTN is set up to get around. Restricted stock can not be sold on a public market such as the Nasdaq. It can only be sold it a private transaction to accredited investors.

Given the private equity trend-lines, these guys would seem to be riding a surge of potential business.

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