Charles Schwab & Co., Inc., TD Waterhouse Group, Inc. and Ameritrade Holding Corp., Monday
joined forces with venture capital firms Kleiner Perkins Caufield &
Byers, Trident Capital and Benchmark Capital to launch a new
online investment bank.
The new firm, which is yet to be named, is expected to be operational early next year and will concentrate on underwriting, managing and distributing
equity offerings for information technology and Internet companies.
Futures plans call for providing research to individual and institutional
investors and, eventually, private placement and strategic advisory
services to issuers. Scott Ryles, formerly a managing director and head of
technology investment banking at Merrill Lynch, will serve as chief executive officer.
The firm will offer investors and issuers a powerful new mechanism for
enhanced distribution, improved targeting of long-term investors and more
open investor access. The three brokers currently serve 4.5 million customers, or more than 50 percent of online investors.
Ryles said the move recognizes the fact that online investing has brought about a fundamental change in U.S. markets.
“Many customers of online brokerages own shares in technology and Internet
companies going public
today. Yet these investors generally have not been able to participate
fully in the initial public offering process,” Ryles said.