The Texas Stock Exchange is pulling in some big names for its recently announced leadership team, including former Dallas Federal Reserve President Richard Fisher and former Texas Gov. Rick Perry.
CEO James Lee said at a press conference that the exchange is planning to launch from Dallas in late 2025, with trades in early 2026.
Kyle Arnold, assistant business editor at The Dallas Morning News, joined the Standard with more about this new leadership for the exchange.
This transcript has been edited lightly for clarity:
Texas Standard: Before we go deeper on leadership, let’s explain what this Texas Stock Exchange is and isn’t. Is the idea to give the New York Stock Exchange and Wall Street a run for their money?
Kyle Arnold: That is exactly the point. It’s going to be a full trading platform, just like Nasdaq or just like the New York Stock Exchange – might not have the trading floor that it’s so famous for, but most of the trades have moved online. So it’ll really be more of a data and technology play, but based right here in Dallas.
Is anybody signed up to be among the first companies listed on the new on the Texas Stock Exchange?
That is going to be the challenge. They have not listed any companies yet. That probably won’t come for a little while, but that will be one of the big key moments for this stock exchange: whether they can get some marquee companies.
And I guess part of getting those marquee companies is convincing them that this is for real, and that’s why they’re looking for some heavy hitters on the board. Say a little bit more about some of the other big names and what ties they have to finance and banking.
Richard Fisher, who was the former Dallas Federal Reserve president, you know, Rick Perry, who was also the secretary of energy. They got some other folks from the New York Stock Exchange. So they’ve brought in some people that have expertise in working with companies and recruiting companies to stock exchanges.
James Lee said at his press conference that this exchange is not being built in Texas for political reasons. Can you walk us through some of the comments and why he felt the need to address that?
I think there is a lot of speculation that, you know, as the culture wars and the political divide has come into focus, with an election coming up, that Texas is being chosen for this new stock exchange because of maybe conservative politics, because of hands-off politics.
The governor mentioned the state’s pro-business attitude. And people like Elon Musk have mentioned that when moving companies like Tesla here to Texas, that, you know, some of the liberal policies in California he did not find appealing.
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Let’s talk a little bit more about the culture war aspect of this. I think some people may be surprised to hear that the culture wars have entered the world of high finance.
Well, Texas has gotten involved pretty closely with that. They have put some limits on pensions and things like that, state investments, companies that boycott oil and gas or companies that are green or, you know, all sorts of things.
So it’s definitely an issue. And if you look at the big picture, all these companies are looking for lower taxes, lower overhead. And that’s really the motivating factor for a lot of them, is the money.
And what about these names on the leadership team? What do they tell you about the direction of the stock exchange?
They want a stock exchange. And they said they’ve been told they want a stock exchange that has lower overhead. I think operating out of New York and putting teams in New York can be quite expensive. A lot comes with that – you’re in the financial capital of the world.
And I think there’s also some fear of some extra regulation coming to the finance world, whether it’s taxes on transactions, on stock trades or other limits that, you know, they’ve been talked about on a national level, but could be impacted on a state level and would really put a hamper on some of these trading services.
Does Texas have any obvious advantages if it does, in fact, become a rival? I know that, like, the Pacific Stock Exchange has been around for a while. So there are other rivals.
There are. You know, in addition to the stock exchanges in Europe, there’s stock exchanges in Boston and Philadelphia that have been swallowed up by the big-name players. But Texas, because its advantage is that it has 10% of the nation’s publicly traded companies, has a $2.6 billion GDP annually, which puts it right behind France in terms of the world’s largest.
And, you know, there are huge companies like Exxon, McKesson, American Airlines, Southwest Airlines, that are all headquartered right here in Texas. And I’m not sure if any of these are going to be listed on this startup exchange, but those are some powerfully impressive companies that a lot of consumers know about.
I would imagine that there might be a couple of make-or-break moments for this Texas Stock Exchange – like, for instance, on opening day, making sure everything’s running. And, you know, the firewalls aren’t all getting in the way of transactions, and that kind of thing.
Exactly. It’s going to be a massive technological effort. But they have already raised $135 million. They have backers from BlackRock and Citadel Investments. So they really think they can get this up and moving.
And I think the world has become a little simpler for those kind of things. There’s a lot of these kind of services around the world. So we’ll see if Texas can can live up to its billing.
