City firm has big plans to support UK SMEs and early stage companies

Trying to trade shares in unlisted companies doesn't come without a few headaches. JP Jenkins, powered by InfinitX technology, could potentially end decades of frustration and address calls from the government for pension funds to give more support to ‘fast growth’ firms.

JP Jenkins has linked up with Square Mile stalwarts Winterflood Securities and technology providers IRESS to match buyers and sellers in UK growth businesses.

JP Jenkins CEO Mike McCudden says: “There’s a problem. Unlike the US, growth companies in the UK are unable to tap into the capital they need, and mature companies find themselves with limited exit routes. It’s clear there’s demand – from policymakers, politicians and the City – for more options to help these growth businesses flourish, but the longer it takes, the more wealth creation we see leaving the country.”

JP Jenkins already boasts a number of exciting growth companies and Pre-IPO businesses, with an additional cohort of delisted companies who decided they were much better off on a private venue. They include well-known firms, such as Prax Exploration, Thrive Renewables, Quantum Group, Carlisle Support Services, GS Verde Group and Stanley Gibbons, the stamp auctioneer. While investing in these companies is riskier than investing in FTSE 100 shares, institutional buyers are demanding greater access to the asset class – which could include the unicorns of tomorrow, says JP Jenkins. JP Jenkins points out that only 1% of corporate Britain is listed on the stock market in the first place. Given the expense of maintaining that listing and the negative view markets presently have of London shares, the number of public companies is likely to keep falling.

This month JP Jenkins announced a major shift towards digital-first operations, significantly modernising our venue for trading unquoted securities. This move towards automation aims to enhance liquidity, transparency, and scalability, accommodating a growing number of issuers and traded volumes. This transition to a wholly digital approach is being made in order to attract more companies and to allow for higher trading volumes. JP Jenkins has now traded with many UK fully regulated brokers, including 18 who have completed a ‘full digital integration’ providing automated buy and sell orders. Brokers can access JP Jenkins’ issuers via their existing connections to Order Management Systems providers IRESS and Winterflood Securities.

McCudden said: “For the past 12 months, the team at JP Jenkins has been working hard with both the broker community and capital market infrastructure providers to ensure we can fully automate our trading processes. Following the completion of this, I am delighted to announce that as from today, we are now a digital-first platform where any regulated broker or other financial institution can connect into our venue, enabling them to view indicative prices and lodge buy or sell orders against relevant securities.”

Andrew Stancliffe, Head of execution services at Winterflood Securities, said: “2024 is now on course to be a pivotal year for venues catering to the liquidity needs of private companies.”

Brokers now connected on an automated basis to the JP Jenkins platform include Jarvis, AJ Bell, Charles Stanley, James Sharpe, Hargreaves Lansdown, Kyte, Ramsey Crookall, Interactive Investor, ITI, Intrinsic, Albert E Sharpe, Killik, Raymond James, FIS Global, Winterflood Securities and Shore Capital.

JP Jenkins provides a stepping stone for the high-growth businesses of tomorrow. Less onerous reporting rules mean lower overall costs both for the initial admission and then to meet ongoing obligations, offering a genuine alternative to opting for a trade sale. Critically, this approach also allows early-stage investors the choice of realising some value immediately, while still retaining the right degree of ownership. And don’t forget that with the current levels of uncertainty in the economy, there’s no shortage of businesses who may be looking wistfully at an IPO but don’t want to take the plunge just yet.

Alternative routes like JP Jenkins allow for companies to take their time in the IPO preparation phase, obtain a registrar and start to act like a public company. These companies can feel comfortable in an environment away from volatility and wide bid/offer spreads, as we match willing buyer and seller at an agreed price. We also have circuit breakers on the share price to allow trading between set parameters. This takes us back to the core point, which is how, in capital markets, one size will never be a good fit for every business or security.

There are lots of private companies now looking to utilise a private venue for trading and many looking to delist for better utilisation of trading and valuations off public markets.