Key facts
- HiJoJo Partners will broker trading in unlisted shares of Japanese companies in the US and UK.
- The startup is backed by top Japanese financial groups.
- The move aims to help emerging businesses grow and achieve profitability before going public.
- Japan's Financial Services Agency has registered Smartround Securities as a brokerage for secondary market trading of unlisted shares.
- A subsidiary of Japanese startup Smartround has been registered as a securities company.
- The amended Financial Instruments and Exchange Act, enacted in May 2024, has eased regulations on the circulation of unlisted stocks.
HiJoJo Partners, a startup backed by major Japanese financial institutions, is set to broker trades of unlisted Japanese stocks in the US and UK. This initiative aims to allow emerging companies and university-backed startups to monetize their shareholdings and grow sufficiently before considering an initial public offering (IPO).
This development follows regulatory changes in Japan. The amended Financial Instruments and Exchange Act, enacted in May 2024, has eased regulations on the circulation of unlisted stocks. In line with these changes, Japan's Financial Services Agency has registered Smartround Securities, a subsidiary of the startup Smartround, as a brokerage for secondary market trading of unlisted shares. Another company, Nstock, also plans to enter this market in 2025, utilizing systems for stock compensation.
These efforts are part of a broader government strategy to foster more 'unicorns' by increasing flexibility and liquidity in the trading of unlisted equities.