Prime Trust is a fast-growing Fintech and securities custody supplier that seems to be in the middle of hockey stick trajectory.
This week, in a widely distributed email, Prime Trust founder and CEO Scott Purcell summarized that the transition from startup, to advertise grip, to overwhelming achievement. The growth being experienced with Prime Trust is exemplified by the fact he and his management team had to struggle to hire executives to take care of flourishing platform demand, based on Purcell.
Prime Trust’s executive seat now includes specialists from leading financial companies and Big Tech such as JP Morgan Chase, Green Dot, the SEC, and a lot more. Purcell said he’s “completely blown away and ecstatic” together with the grade of his group.
Prime Trust was created from this transition from conventional capital formation to internet capital formation and after that digital resources. Before this season, Purcell commented that as fund began to go online things worked fairly well for conventional capital markets however when it came into personal securities, the story has been different.
Because of the dawn of regulations, such as but not just restricted to, Sarbanes-Oxley and Dodd-Frank, it became nearly impossible for companies and real estate funding to go public since it was just too costly. Regulations enclosing decimalization, study, and suitability made it impractical to allow agents to sell or create markets for small-scale stocks.
Obtaining compliance and regulation requirements right is difficult to do. Too many rules and you squelch creation.
“Hence the people markets [were] effectively shut to all but the largest companies (to increase capital) and their shareholders (for liquidity),” said Purcell.
That changed with the coming of the JOBS Act, along with the legalization of internet capital formation beneath Reg CF, Reg D (506c ) ), and Reg A+. Purcell saw a chance in those regulatory upgrades along with Prime Trust was born.
Purcell says now We’re seeing an “explosion of broker-dealers filing with the SEC to create next-generation ATSs.”
“We will soon see some of these innovators delivering on the promise of active, liquid markets for private securities and real-estate interests,” great for the ecosystem – clarifies Purcell.
Purcell said last month:
“Even though clearing brokers won’t hold private securities and even though the traditional public-markets settlement infrastructure doesn’t work for these transactions, Prime Trust and other technology-driven custodians are creating systems to accomplish these things. This solves the issues of custody, settlement, good-delivery and 12g. And it’s working, as evidenced by something that didn’t exist a year ago; our settlement platform “PrimeX” implemented 600,000 counterparty transactions in Q1 of the year…and more than 750,000 counterparty trades just last month, an exponential growth rate, which though largely cash and cryptocurrency the stage is asset-agnostic and so will repay trades of personal business and property interests firmly and frictionlessly. Together with the SEC and FINRA becoming more comfortable using custody and trust alternatives (noncustodial broker-dealer models) for personal pensions, such as tokenized securities, trust firms such as Prime Trust will play a critical part in the development of [Alternative Trading Systems] and [the] production of orderly and efficient secondary markets.”
Crowdfund Insider contacted Purcell for some additional perspective.
“We’ve grown faster than anything we could have modeled, going from zero to over 300,000 counterparty settlements and over 70,000 wire and ACH transactions per month,” said Purcell. “In Q1 we were blown away to process 650,000 new AML check’s, and then went on to do 1.4 million AML’s in Q2. Our growth is breathtaking, and our team is amazing.”
Prime Trust Board member Jor Law, well-known in both the crowdfunding and crypto sector, had this to say regarding Prime Trust’s growth:
“Prime Trust was really in the right place at the right time. Supply met demand and then the platform executed,” said Law.
He added that Prime Trust has hired over 30 people in the past couple of months and they are still aggressively hiring.
“It’s really exciting to see global demand for our services accelerate even in the midst of economic uncertainty,” added Law.
Not every Fintech will be a success and the life of a startup or early-stage venture is really, really tough. Prime Trust has been in business for years. But it seems that Prime Trust has turned the corner and is driving outsized growth after many long months of early-stage struggle. This is great for the company and probably pretty cool for its investors too.