FRGE - Earnings call transcript Q2 2022 | Forge Global Holdings, Inc.

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Operator

Ladies and gentlemen, good afternoon, and welcome to Forge’s Second Quarter Fiscal 2022 Financial Results Conference Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions [Operator Instructions] Please note that this event is being recorded and transcribed. I would now like to turn the conference over to Dominic Paschel, Senior Vice President at Forge. Please go ahead.

Dominic Paschel

thank quarter for XXXX and for us Abby, second Forge’s earnings you, you joining all today Thank call.

regarding will Joining Forge’s me at prepared the They your CEO; Rodriques, results, remarks share and Mark end. then today Lee, Forge’s questions are take the quarter Kelly and CFO.

one release days, be conference on after Just being call accompanying hour after press webcast market beginning available quarter the second live also page. we today, Forge’s close will for our is XX replay financial about a and of There’s conclusion issued announcing results. Relation the Investor This call. presentation investor

report our site make During of risks and subject this soon factors and be course materially projections including in forward-looking differ forecast to there these discuss on and may make uncertainty, and that to risk factors are quarterly outcomes statements on those we based We of actual well. from SEC today’s the IR forward-looking could are will the call, file current Any cause filings, expectations, statements. found which we this in form various XX-Q on in as date. important can included our we quarter, that for statements

performance. that As measures our we a forward-looking which believe discussing be are meaningful otherwise to noted, will non-GAAP statements. required are presentation evaluating update reminder, we not In we unless measures, company’s the today, adjusted are when financial

will measures the and the which data quarter on on focus GAAP is these financial release, discussion contained XXXX. refer second website. detailed For press the Today’s on IR of you our disclosures the reconciliations, should within to also

performance as our results over to encourage affected unexpected can quarterly as annual outside Kelly. I'll we basis, an you call on As events the to that, be by value With turn control. Forge’s always, well

Kelly Rodriques

on this to our turbulence, heightened We against Thank thank Despite Good for on steadfast building we market backdrop operating a we long-term continued will of you, share of you build vision all briefly balance deliver on joining which within, results results. us and everyone, we're moving while second quarter afternoon, to our strength context a volatility. I'll sheet. into delivering touch our toward market results prudently, before the a commitment the you with our Dom. today. XXXX broader business quarter you and remain highlights. this With that, with

continue As the in companies anxiety ongoing ongoing IPO landscape markets corporate you're and first and of QX the work as said the much this expectations the almost times across clear does all Ukraine. volatile remained like to And inflation, public interest times. characterized new including with full geopolitical continue quarter's before, headwinds, market and was in quarter, reset volatility. the reductions by rising opportunity completely rates, impact yet, aware, valuations. macroeconomic workforce and their The it in in closed as private and stable remains we and the window Investors

toward pronounced. solutions as We investor Forge opportunity stabilization, in, the companies expectations more to private the companies platform the well more holder prices market attractive to for to equilibrium. trend further As liquidity at access further believe on arrive as and companies pushed private need liquidity and for and investor become continue out we're positioned equity timeline new

QX companies companies Some primary late in previous rounds in our inversion In see of show largely of primary QX, but their insights to round primary raising began update the July, market average to down released in values, off, in market at noted the for fundraising private financing. staved on a QX rounds. we we QX while discount that

average trade X% trading discovery. real-time some round time, last to trades. at In secondary in Forge secondary after to buyers to in but in last declined compression premium primary QX, continue discount price price sellers to QX. their engage the saw saw also fundraising a round took and an as consistently We It company's prices

the number with quarter. for higher secondary issuers the On was of any shares the unique market, than offered other Forge's sale platform on

companies XXXA public in canceled stacks, markdown and remain for reach out valuations of the IPOs, liquidity delay As many. market

valuation Instacart's XX% Fintech a example, just self-administered billion itself billion. financing new month, most Valuable once the the was down it by $XX key when cut months For March, $XX $X.X ago. raised XX%. Klarna in just valuation its valuation, from Company reduced the Highly to to billion, at more Private And $XX XX% investors XX Last recently, secured reduction Company, further valued than billion, Instacart Swedish it by at Stripe

subsequently price on and fell of similar in suit, sorry, on that and XXXX. I'm a And or QX that's trade price made XXXX indices of earnings prices markets this average, QX of XX.X%, secondary reduction. quarter Following XX.X% the secondary about when quarter. Forge conditions period Public -- companies second the in reported during to tech the same this Barron's currently XX% stocks canceled the due falling is about of and with XX% XQ And companies IPO, everyone. end but year falling and market over deteriorating recently XXX are through the off are the holding comparing finally,

that showed in continue The in QX to by Forge accompanied up a to of the times, new the see we narrowing volatile companies platform. average which for at their pricing, at between record converge number is look asking We want at we even unique sellers for companies spoke was refer forward and and about the spread to of However, arriving prices slight that The something average discovery the previously. which shares price buy. buy price buyers equilibrium. this to prices platform sale as point are

feedback that narrowing the to year's are could continue and and since and our we to first in of of and at of our more companies sellers spread XXXX to slightly the public metrics. expectations, the seeking as call they're private June investors peaked prices. signed of at April addition, announce discounts valuation spreads remain introducing declining two and XXXX, quarterly reductions be of resetting We but analyst compared tracked signal, XX% decreased January appreciate Bid-ask prices to In last slight in XX% about spreads the additional business to median historical following XXXX. XX% wide listening

is The number of they through in XXX, QX, what total and our up XXX of marketing of In Interest brand year. known We our year-over-year or up Indications were IOIs. from last as the a efforts, company QX to of with XX% companies thought leadership recognition first media public awareness. became are

And quarter. and cost aren't the and have the big of IOIs inventory as latent increasingly high, with Unique anywhere. with and becoming private turn we've price also for up market. now and is an for out, build mind and than This place companies in saddled solely anticipation liquidity over all-time Walmart book are synonymous first discovery seen year, insights, businesses unlike Forge, building getting means, to power. Forge becomes in for us as to to the the But economic trying more equilibrium resets. holding the people solutions We're are as over supply hitting a that up momentum year showing this inventory market is the and Businesses as expertise been XX% demand doesn't calibrate grow buyers continue with we companies sell-side those businesses, private demand. half the inventory reestablishing. ago private

dry long-term remains innovative for hot. technology levels have about powder continue deployment poised optimism companies to the more emit unicorns We as into of and the

unique So your extremely to X% point any financial revenues, I In $XX.X XXXX, flat $X.X were to and see to of second which from the now second new less Forge's million Forge. relative platform generation quarter. record in about million. the made. QX million. previous expenses quarter results. giving are from was at an on million, XXXX terms than all-time the They will $XXX transaction-based just said Also custodial for balances. to inventory companies to we XX% private second totaled the custodial offered administration encouraging million on about year-over-year as up million, quarter business to XXXX, metric up fees And year-over-year of Forge compared quarter, is listening $XX.X Forge’s revenue in were shares in $XXX Total cash I total more for year-ago were that In there of $X.X with second feedback, quarter note the sale before,

the site investor if data supplemental you're on IR Our business for metrics interested. new historical both as our information

Assets to under in to QX, XXXX. I'd And second some increased from quarter. of quarter $XX.X second year-over-year billion business X% like the custody highlights up notable during XX.X% highlight the in made Forge

and and experience. First of Business all, delivered updates Forge our In functionality segments in Forge QX, impressive Market. Market Custody

more analytics, management updates the of seller and stocks, the trades. enable Forge capabilities predictive takes learning and features that time including most reduce likely include efficient recommend it dashboard to platform, close to trade, the new New for buyer certain IOI that faster machine

well and client execute the self-directed new access which improved client more them enables a and seamlessly their to portal key to released Forge Trust for transactions holders, support as account documents IRA as representatives. gives for advisers self-directed

on even provide Now Intelligence, we more to in Data to the business, and to Data Forge Forge visibility our private announced customers design the upgrades for the Forge experience market. our side, enhance

pricing front on Forge customers companies now changes trading activity. Intelligence movers in summaries alert and of prolific last since the activity price data center the data trade summarize include in on enhancements and Additional biggest the Forge with the Visual most the platform. they instantly logged

an Enhanced Interest Forge Additional of breadth expanded sets new and data analysis. to accessible pricing also include with to two Public data, enhance enhancements Membership integrated and users Marks data Intelligence valuation providing customers. points Transfers

private Forge confidently average visibility way In increasing can extended so volume-weighted in that VWAP platform Intelligence, VWAP, data private markets one of they enhancement as Extending is Market stocks, more clients. addition clients price beyond the our to we participants to have market. to of Forge known participate we're the

and has Chief one expertise Morgan customers' and government company create regulatory financial On impressive in focus Stanley services of experience building of stage and equity including to on services we Legal top-tier his respected affairs as issuers growth grew hired international General with from built team Jose legal Short, a or $XX to I'm our is Cobos as platform. Officer. We a agreement board. and may signing an promoted direct joined and under the and Forge on team both multiple he corporate XX the for President enable Johnathan regulatory ICE Markets Counsel billion through for governance, accessible, M&A Johnathan business of public. to an and have orders in operations. the to was world's securities NYSE, we new the years personnel. team Stanley, two-person the parent and to liquid next quarter. Jose of as Intercontinental an and of private a and transition quarter, traction Exchange He alliances ICE, running, and the hiring, we most market. the leadership also excited organizations as of Johnathan Forge XX his [indiscernible] company, transparent legal their Johnathan’s relationships to function we've financial make to very invaluable new continue from private an spent been to legal regulatory when with pleased We're announce domestic partnerships integral also with banks public which our leader strategic to in that to and private part Morgan of company

Now with the of capital, adding as Reflecting the and the slowed be XXX we our are approach on growing quarter we have to stewards will in to hiring hiring, a continue deliberate accelerate taking we team members. headcount. to pace technology engineering of judicious development, including team environment, responsible ended

Alternative, the we asset addressable remains total expected is trillion the private the to towards and market. market XXXX. to $X overall growing, to as trading their expected allocate by clients want for rebalance approach a their to alternative prepared However, hit advisers market alt assets continue clear. And for are general, AUM to $XX Very simply, billion be to the RIAs continue classes portfolio. result, as And opportunity by XXXX. is in own as

insight. focused our the So to platform customers, in the improving are strategic trading and that continue cost this turbulence, on products and growing with to goal period and the time the taxable building down for and trade, both and deliver we our this future, disruption drive broaden way improving and market, to of of our building, presence now like access market we and heightened of lending will the data still internationally expanding partnerships, for

who get of Forge clear, need engagements. mindful of more out improve. critical build those be To interact to So also the we're of and value all with

potential ROI the profitable to the scrutinizing are we invest the so we And platform. every of Forge long-term dollar growth of prioritize

with with when We continued potential programs disruptive shareholders to the are companies are helping offering value market time, it, customers positioned private navigate data, well unprecedented markets enhancements during investors, stabilize. we with our to and we're capitalize this and and believe to expertise and our customers this and bringing

it turn Lee, Now CFO. our I'll Mark over to

Mark Lee

transaction-based $XX.X million. Thanks, Kelly. of ago came down second $XX the was Of XXXX, total quarter total expenses, quarter fee fee million total million, at of second Forge's In year $XX in million, that $XX.X from reached revenue, less in placement where the quarter. placement XXXX, amount, down revenues from revenues the

was take Kelly average And market, XXXX custody the was to take a quarter of accounts X% described, X% quarter achieving accounts XX, and for year-over-year is macroeconomic in of active market X.X%. volume $XXX $X.X decreased decrease an geopolitical companies, from this the ended overall our year generally to were quarter This down in negligible, was million fluctuations $X.X Transaction to As the to VC ongoing extraordinary clients. year-over-year of one second watermarks in dislocation. for decrease net public this flat block trades. administration balances. not result continues with The year-over-year comparisons. from into million, individual previously last noted, institutional cash from previously and significant the fees impact and was of a of XX% cash million. high investments of as record by that for we debuts second custodial year deactivation revenues mix quarter in onetime at attributable the rate a the of was financial fact Forge private XXXX. The and billable driven quarter in million Total the are flows rates instability June Total custodial record quarterly $X.X year-over-year XXXX; due at in create versus changes

We from to expect and increases. account stress continued to interest growth continue rate benefit perform

from adjusted EBITDA adjusted included of EBITDA $XX.X in and by million second operations. quarter, GAAP EBITDA loss was compared to million release loss SEC adjusted the Second press operations the XXXX. in $X.X the measure driven results. changes operating both comparable $X GAAP the QX million our compared the cash gain We've used second provided the cash of operating another recently quarter they and net flow activities quarter. EBITDA of activities operating primarily revenues, filings. investment XXXX. our In $X.X also reflect was adjusted year-over-year of loss net of reconciliation Net $XX.X million was year growth quarter $XX.X in measure our EBITDA in ago of million technology in GAAP million, quarter Cash but from in by The to net in both for cash Adjusted continuing are compared and flow lower a is to in initiatives. to of most

the our prudent million strike macroeconomic a weighted equivalents to growth. cap The generated dilution. of was was Cash and approximately million basic We $X at financing flow as financing steward was cash public loss of warrants. able quarter will fully share the diluted ended financing net also of balances to estimate compared outlined QX first million. Forge June in balance to We provided three in financing a the our mindful average legal shareholder million June point growth cash XXXX. million of from exercises our three The with ended purposes. outstanding, volatility warrants our an reduce $XX a and of at time. and guidance provide investing continuing shares. continue as redemption approximate Within million proceeds the from outstanding XX, compute in are XXXX, for outstanding the positioning cash XXXX. given that and Net IR uncertain not cash by our in XX, risk to for our provided information and from and million. were sheet market modeling ended previously used perspective, we've capital. activities during on shares months simplify $XXX June being our exercised well XXX warrant QX shares basic public in $XX.X future by we're activities to this our infrastructure XX.X expense increased and provided the connection our approximately the cash between housekeeping XX, table conference the supplemental call, support were in stock Kelly activities of approximately evolving Of conditions, million months We position Cash $XX.X shares quarter finance, these From of activities. balance XXX as non-cash common count were and said, for the we investor on site, also and net number environment, average investors' is

to record tough guidance note, is as Forge all-time there August us. change to whether relative will as huge practice to we important historically of forward been evaluate to slow the in stabilize, saw monitor half opportunity has expect levels a our Inevitably, and continue growth It markets But in our to determine resume seasonally first future. to XXXX. normalized the that to one. comps from our we in front are

While managing of our be we're focus of to high company. on while volatility, environment and our this investment, managing growth stewards market cost maintaining the good building and actively capital, and uncertainty

technology sales invest our marketing continue support and to in We growth. and to

expect we headcount, ended total XXX We scale and our as the a costs of As our to XX% in with we bear quarter investments up fruit, percentage revenue. deaccelerate year-over-year.

is a albeit in base pace. that consideration we people and evaluate the and expand is our appropriate slower will at and important management This Board invest our important to in most at very employee asset continue Our real-time. an continually

call back to Kelly. the hand me So, let

Kelly Rodriques

thank in for building vision for Forge Thank the our want you, future. private shareholders our their to market confidence and Mark. In closing, I

and we for whose turbulence we're it environment for challenging market. to is challenging moment insights, a In prudent has market quarter market how moment navigate go takes private recalibrate, to have experiencing the our participants in has the convert we a that the markets for powerful companies expertise, markets, in that there market work. the company The the Dom, this our miss this our broad-based and been will we're traded data, to today. in helping trades that and continue believe when like opportunity we'll all environment don't the to to that trading greater private And been our private so shareholders. do, especially, to you. customers our to meantime, recalibrate back well-positioned. advance shares are and latent that they economic for engine economic we our into deliver when fundamental power cement second tenet In The position companies valuations valuations to of leadership closed through value I'll our turn time we're

Dominic Paschel

Abby, are taking we're questions welcome we -- the open from audience. to

Operator

Devin from Instructions] take [Operator you. JMP Securities. question our Thank We with Ryan will first

open. Your line is

Devin Ryan

Hey. Thanks. Good the question. taking everyone. afternoon Thanks for

Kelly Rodriques

Devin. you, Thank

Devin Ryan

I'm that this be closer what equilibrium to all of per seeing see are moving an extent July the going you price equilibrium guys the just in maybe have great of the also assuming about the there where monthly guess also, lower quarter kind I markets kind But August, is detail should talked I probably improvement reacceleration we'll we we're about you to third quarter. volume appreciate environment? been days to I over a months you of think and assuming necessarily the the the little here then guys aren’t appreciate early moving trades maybe And around want bit to start and into that's the and trade terms And how of judge to I And in can so we provided. meaningful. really course a kind of progression the number talk of you conversation engagement. into the about, hopefully, second as of

Kelly Rodriques

Let me start. This is Kelly.

are it's by clearly, the the bid-ask first continue our also while you we're to understand averages. carefully. can driven to buyers. spread, we important last these that as imagine, start than more call, are me And with from market And Let watching part. the We, data see that's sellers a watching

we indications is are turning. careful could overstate be to the think We market not what that

of by cited companies including being However, given that moved and some we proactively being the facts companies. even now valuations by accepted

the off, Mark trade volatility, the is believe previous the that say, has periods activity pointed institutions historically are institutions time buy have were relative of this Some movers the to it's whether and a coming in at were period, vacations of out, first equilibrium bid-ask spreads back year the pandemic, in to pricing. see what we're sometimes as in been coming. you. what But that we hopeful or seasonal past, we attractive when I'd saw in do during that said have we the of as

carefully. that watching we're So

lower seeing are We price our around done you're at we not asking environment, now in changes seeing done meaningful trades weren't that if in fees that definitely prices getting QX. but the getting are

world to two watch on it. And the we lot so I'd there's about control. XXXX, to The going don't right say going in anything disruptive continue that a it was we're saw last in this quarters, now like we time but

ask Mark sort the indicate hitting forward if in jump of look. seeing we're of a I'd not points So as I'm other any what that to

Mark Lee

a couple would of Hey, things, guess, I mention. I Devin,

significant size don't of don't is the expect movement trade. to typically average and of things significant movement see the the One that in see we

As a looking are particular take to has to in take a bite typically institutions to impact, position their platform that portfolio. size are looking name a certain meaningful a on that right, usually our

a to that price you'll shares often, order to a in more at is they So in acquiring stock, particular more position decrease meaningful that if the of a is will there's price the lower see size portfolio. be what take a

all watching public the we're the mean the But at would to the starting level, markets other feel no, that The this. when that or and watching looking moments thing and you markets are macroeconomic is normalize -- volatility for looking that I I note at stabilize. and public the

back pace will note to in to in of same kind clients. the There jump with kind in start that keep if your increase there the encourage of to the it's our trades as of regard and factor our that a see eye about private is on, that comments to we the August, Fed, lag of that markets that's with rates. And think for the start views of in and takes then slow is in to the of the because an Fed time to two, one interest three public cause I kind that, plus, of it important finally, will we process, and two market, it that buyers an on trades. the settle engagement time close It's our important improvement markets. the three matching same not kind plus kind with plus July

that's so taken into be that And obviously has another thing to consideration.

Devin Ryan

Thanks guys. so color, Great much. Okay.

hit into Just pulling spending bit areas, given little a reprioritizing here, around maybe a we whether context at guidance, don't and whether that's all the appreciate just I expenses. or you're backdrop but in evolved you're back how market certain more just Mark, as follow-up shifting have maybe and about on certain thinking Obviously, areas. maybe just

thinking and that where see obviously, secular to the a you're and market at term, it's or You such all But in still spend? how near has hiring spend opportunity. around big to shifted much the addressable

Mark Lee

Yes.

is me me – again. Mark, Devin, that question handle first. Let let This

negative to company adjusted adjusted a this has positive passed – So kind some positive difference, remains second the EBITDA, of EBITDA. fact, breakeven always breakeven run I – Day, a were adjusted reminder, XXXX, achieve with this our slightly the been targeting We to cash time been flow. to think positive to XXXX. operating as mentioned and of with EBITDA right? since company And a XXXX and as operating that's this no has positive backdrop, with And down. in entered But Analyst slightly we half philosophy exception of XXXX, we've although Forge an

to the line that the but has believe is and while XXXX, affected for we moderate So to bottom right the current stay focused shareholders. our continue for to benefit business significantly building our long-term of approach macroeconomic on the environment top our spend

If you even think and and directly out, turbulence. support of the in of not the more to clients so this time mean, need kind pointed our so question, your in I I business as services our changed. TAM And has opportunity for this answer anything,

this think back the we to now not that – so pull significantly, at to we the of have time evolution And it's be – phase Forge, in prudent.

of it continue build need future in hiring. watching So this We're space. for cognizant closely. the the we're leader we to of moderating the infrastructure being very out of our pace But the that. We're to

And so that's goal. our

As that Kelly we've legal, said, making and on need support to continuing lot of our finance, a we're been so. also future efforts, that technology, our build sure go-to-market the providing have growth and that is marketing we and to focused our growth, risk

Kelly Rodriques

I this on before acceleration we that plans. guess at of that fact of other we hiring move make -- deliberate I the rest staffing made any in the We've decisions those get quarter slow Yes. much a this XXXX, of wouldn't going point to slow. did and we're the to watch

Mark Lee

on have many we advantage I too, time significantly that our is fact, get the growing best And have think, I add to I the in a we and believe stay focused through we're company. this wherewithal the that the in difference competitors. wherewithal, Devin, competitive balance like the we capitalize than cannot thing stronger sheet, we direct think that period kind the on And is, they the of now feel and gap to and our of other might in with one cash position

Devin Ryan

really Okay. answers the Kelly Thanks, Well, and Mark. time. and awesome appreciate

Kelly Rodriques

Abby, Devin. you, caller. next Thank

Operator

Yes.

Worthington from with We Ken question will our take JPMorgan. next

open. is line Your

Michael Cho

hiring, the the you Thanks for is spend to Cho I highlighted but is This very guess Hey, long this wanted during balance I for you have solid just point you moderating sheet. period. I press just balance Mark, mentioned, question. good realized touch Michael kind my sheet taking of that afternoon. last Ken. around on again, you're as the

take organic whether mentioned, curious inorganic, or you you're your sheet balance So given I'm just situation, today. the to if as just advantage considering, there of ways trend

Mark Lee

then initiatives. our quarter data I’ll through improve efficiency of time, process, that think Yes, And core building our that which of in everyone start building I terms out materially, presentation, the we about Kelly being opportunity, mentioned we we excited a business, of on We building. the we're the we're we're since that we things question. the chime are really appreciate our in, first out new also spoke think things changed that to in trading product of kind talked from roll increase future. us expect and our be be and there working of the to focusing Look, things of we're all to kind the the will number Michael. be talked Analyst business, hasn't of really, of went with kind about. we in that on to a the We successful. help getting that kind continuing key about think international of outlined technology quarter and really -- market. are these and Kelly these of can continue And expansion, I And Day, lending our kind we've reception

so. our our we'll So do that's funding we're marketing and continue technology to and go-to-market hiring, and what through

Kelly Rodriques

solving, as while But problem only to market liquidity we core as in side. will scale the create Yes. careful. to are well. public advance I'd really We're provides think M&A the growth, our opportunities M&A us. not we're as be business periods inorganically an of on at but that felt targets. us to selectively went We for there was add opportunities we looking opportunities on will going because, some helps look us that was to continue Part with market the we of organic at think opportunity for reason there that the

of and carefully interest But right could if are it's of at we the our out, the whether Mark careful inorganic that so a a sellers best right again, kind out time mindful relative point. or our with have watching price not a pointed to sheet. is think and deal making But of on we. valuations our I So there, are be being of balance us this strength platform in for careful move they're are and really as be lot

out think our if you're team poised if heads anybody term of continue going markets, here scale We're people on to build. to going tough. a at the even a a call want I team the committed great this keep to that's short on capitalized we're little that, and opportunity looks We've down. going of private looks execute to the got and and So go to

and ready heads our continuing and excited keep to executing. very down we're So, about

Mark Lee

want Michael, mentioned Stanley. but and the with Morgan this, that announced signed the to I last And agreement point, reiterate, we Kelly we

the or and So Forge including with and that of working and to another others named, brand a that's Stanley of roster Morgan building Wells BNP platform we're that market. cannot Fargo with partners be the out out important part others and

that I want point. kind to So, stress just of

So element that's another important of our strategy.

Michael Cho

Really, this for spreads you into just you a the Kelly I'm as you characterize the to transaction talk Excellent. Did you that bit, I heading quarter is how follow-up. And quarter or a mentioned, pipeline exiting QX Thank make characterization XX% trying correctly, being just the Thanks. versus some progressed. assume, about up get and Great. where volumes wanted should you I QX? picked of a little caught activity sure correctly. start exiting can of but hear 'XX. I at that. to to you just this of kind talked there

Kelly Rodriques

Yes.

you clear in to doesn't potentially that saw guess so we think around that, back be during that that spreads an you difference 'XX also couple and could in dataset, look ’XX period XXXX. of of what's present shine of ask bid really really So in point a an years if number as were of little incredible the indicate the [ph] volume be a over between volume, I a terms that a meaningful that, I the really I as was viewed come. But broader of life like there the look, indicator to volume cited 'XX is shift see much

So, everybody sitting that we've optimistic like trades about that little go towards to we closer to we're got equilibrium point all else, where but a start ways here happen. see moving

meaningfully a than better as So, ’XX. say 'XX number far out as I wouldn't go to is that

Mark Lee

example market, the multiples their and reemphasize valuations are fact indication our starting recognize was that – and acknowledge [ph] the trading of to an are in and the -- round that decrease starting Michael right that and to important that is at. previously said and the the And shareholders were points of at earlier Stripe. to the to trade Instacart mentioned valuations see the last below been had some we're they that private Barna that an

companies And we those the secondary world, think you see that think I both to in you'll Venture and encouraged market. primary will reduced continue they see we're to to private realize to see as I start continue recognized and start to start the money trend. by raise valuations from

Kelly Rodriques

If there that associated on your [indiscernible]? question that associated valuations here. evaluation, is take think Devin. question that the the what's and constant. by revenue asked was decline email rate dynamic a mean the decline with the I was Does Mark, for

then guess, So valuation revenues, seen not high below Historically, the seen and lower at trade stock lower the a have $XXX,XXX company our I size if or size $X.X implies we in lower company And worth trade size private put is, think, I -- question that. you right? to the order we've in down with to trade a to want is people wanted and worth private XX%. certain to historically, million

necessarily your down buy. going $XXX,XXX Still want not You’re to trade on reduce to trade. to

take want right in position still You to stock. a sized that meaningful

get lower buy more because So shares the due stock $XXX,XXX price. still this you'll to

that that's So, been we've pattern kind seen. historically of the

relationship we don't trade So, decreased between size. a valuation and direct smaller expect

we about trading the the of total other companies, when and turnover. Analyst think of is, The those activity of competitors a were remind you there’s Day when even that go Forge private thing market, in leader that you I position the that the in only in to was low is space, trade, volume platform, relatively presentation. valuation kind as would prior This X.X% currently XXXX again, the staff TAM, But on people in the addressable base they back companies, traded private our Forge right? our total this a our

minor shareholders where even much we the trade, so more opportunity to more so there some companies -- give just There are So valuation. today. opportunity management many to the if of was liquidity are than kind

finish So early and to that sorry, massive the Michael? in we're and this opportunity TAM opportunity. we this back that, stage Do again, the at Michael. I'm gets the

Dominic Paschel

answer do your Michael, questions? all you

Michael Cho

Thank most sir. you, Yes, of.

Dominic Paschel

last Thank Owen. Okay. I for think question ready from we're our you. Abby,

Operator

Thank from you. question [Operator our Yes. Lau And take instructions] will next Oppenheimer. with we Owen

open. is line Your

Owen Lau

taking for questions. you Thank my

declined I but billion to that went $XX.X these sequentially So, Could assets up? to dynamics? your million, explain accounts little down, more but $X.X billion. total Why went assets from Thanks. under $X.X from custodial saw please your million custody account a increased on bit you $XX.X actually

Mark Lee

Mark. Hi, Owen. Yes, is this

answer question. me Let that

custody, we fees on a onetime amount as than we we that these custody this of provide had our deactivation inactive I but it’s accounts. not said is our These -- clients that change of decrease, therefore, were that business accounts. -- accounts custody assets accounts for the earlier, quarter-over-quarter were was are who right. said, was change. it to exactly So past the accounts impact the inactive And as charging have under These -- accounts, you're significant we The on, billable service these institutions. accounts. when were year-over-year more were said because where But -- did had this a inactive to other were as had and an a financial client they these deactivate

Owen Lau

Got it.

imbalance. how year-over-year. about understand is the companies you and And XXX, it understand and the you take demand as to follow-up this number think up trading how long total this start historically I them issuing in increase my interest. that mentioned well, were supply/demand need I that to shares? of indications think leverage I to But see Thanks. of try about to does of information, we indication speaking, So XX% when interest, the

Mark Lee

and you take Kelly. it, don’t ahead Why go

Kelly Rodriques

think of a in about is, of as I people there understand, price other available you've expansion we're to Owen, on companies continue we're amount private company, elements we spoken And to awareness we're elevated, to what discovery increased have representation And or and I IOIs important translate sell-side activity markets. an Forge meet think as invest you obviously, get that's have a we've book, describe, then, as said, in And closed heard marketing the Obviously, our the is thing for and prices for seeing understanding an help those platform. the needs meet, but that's have price become the about there's Forge remains So public shares and variable. we're to that us excited our order trading be offer equilibrium, the to as then to spread, can spread, record saying that the result, if ask of limit have so to is as bigger challenge going spread of levels to obviously, That has drive trades have into a and to and between closed. revenues. book. a happen bid we've trades seeing bid and to in those we've

in to rebound recovery. start they of meet risk what is position, regain point power, very that to from because we're that cost as so, the the in to then back dry and there once at buyers willing engage, a right, we're in come see the inventory that that. they're late And it's confidence move encouraged we'll that's the economic the about But kind to your demand. with powder And the -- describing once then

Kelly Rodriques

data, I'd in when presented is the I sometimes here we're it's guess that, the only thing presenting add averages.

depending transaction seeing likely can come more the while so looking to lower around. seller, happen not that in when trade data, companies a And that and a the to may and market them. that's And they happen lowering which comes environment going you a in starting What is to also this sellers recently lost that entered name, our of signal fundraising to is make that primary the companies seen the before navigate seeing have is valuations, still between previously. in signaling valuation in time you're on data into rely than the interest in what's mindset IOI haven't product expectation. particularly name what's or is market around on QX particular Forge people where helps just the into enter the you're on This

meet to a And willingness buyers starts and latest demonstrate make really IOI as Mark described, move once and sellers we show inventory and so the a as about to trade. terms talked in

news I'd desk, across reach now, that raising companies noteworthy, down what in watching as period the first what with averages. this that But the money that individual starting valuation period across as presenting And we're but establish to as the reducing public. that the way that we're it board they're of names. start really the good board, to signal the T&E. the equilibrium say part of line, is we individual of And is then on And So from to trade or all right proactively names. the officially, we're the getting internally, starts signal strike, starts

take that a that, we'll to scale back, it going optimistic come place watch and we're very and to in and advantaged we've to be we're does that deliver So, built. when technology the continue the and data on

Owen Lau

you, it. Got much. very Thank

Mark Lee

you. Thank

Kelly Rodriques

Abby, unless out we'll we York any road additional -- be to this look have New San in and on forward quarter. we Francisco, coming questions, the Boston

time the a balance hoping couple in of And meet the to And first our to years. in taken we're time call. we for so person appreciate you've

Operator

Ladies concludes and gentlemen, this call. today's conference

may You now disconnect.

Forge Global (FRGE) 12 Aug 222022 Q2 Earnings call transcript