Photo credit: Billie Grace Ward on Flickr, under Creative Commons license

The New York Stock Exchange (NYSE) has filed an amendment with the U.S. Securities and Exchange Commission to allow for more direct public listings on its stock exchange, direct listings, in this case, being a relatively new way for companies to go public ‘directly’ rather than taking the traditional path of raising capital from investors by adopting the services of underwriters. Direct listings can be basically pictured as a direct move of shares from the private markets to the public markets.

Direct listings have been tested by only two companies so far, Spotify and Slack, which listed in 2018 and 2019 respectively. Seeing the success, other tech companies like Airbnb and DoorDash are said to be eyeing a similar path. In December of last year, the NYSE filed a proposal with the SEC to allow for more direct listings but got rebuffed without public comment. The stock exchange has now filed an amendment to the rebuffed proposal, this time providing more details on how direct listings would work. The NYSE touts direct listings as a less costly way for companies to go public and one that could lead to a less volatile price discovery process.

With the filed amendment, the NYSE is awaiting a response from the SEC.