Private Securities Clearing Platform for Standardized Settlement
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Solution Overview
Problem
Conventional services fail to provide standardized methods for clearing and settling private company securities, resulting in lengthy settlement processes of 90 to 120 days and an inability to address the urgent need for liquidity in pre-IPO companies.
Innovation Solution
A private company securities platform that receives non-standardized information, updates it into a standardized order format, generates and transmits notifications for transaction approval, and automates the generation of transfer agreements, reducing the settlement time to less than 90 days.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Loss of time
If conventional services are used for clearing and settling private company securities, then the process can handle non-standardized transactions, but the settlement time becomes excessively long (90 to 120 days)
Solution Approach 1:
The patent transforms non-standardized transaction data into standardized formats by changing the data parameters and structure. The system accepts various non-standardized inputs from different trading venues and converts them into a uniform standardized format, enabling automated processing and significantly reducing settlement time from 90-120 days to a much faster timeframe.
Solution Approach 2:
The patent introduces a centralized clearinghouse as an intermediary between trading venues and settlement systems. This intermediary standardizes and processes transactions, acting as a mediator that converts non-standardized transactions into standardized formats, thereby reducing settlement time while maintaining adaptability to handle diverse transaction types.
2Productivity
If conventional services are used, then no centralized clearinghouse exists for private company securities, but this results in inability to provide standardized methods and fast settlement
Solution Approach 1:
The patent creates a universal centralized clearinghouse that handles multiple functions: accepting non-standardized transactions from various trading venues, standardizing the data formats, processing approvals, and enabling fast settlement. This multi-functional system improves productivity by consolidating previously分散 operations into a single efficient platform.
Solution Approach 2:
The patent segments the settlement process into distinct standardized stages: transaction receipt, standardization conversion, approval processing, and settlement execution. By dividing the complex process into manageable segments with standardized interfaces, the system achieves faster processing while managing complexity through modular design.
3Productivity
If non-standardized information is processed directly, then the original transaction details are preserved, but computer and communication efficiencies are reduced
Solution Approach 1:
The patent changes the parameters of transaction data by converting non-standardized information into standardized formats. This transformation improves computer and communication efficiency by enabling automated processing, while the system preserves all essential transaction details through structured data mapping and validation processes.
Solution Approach 2:
The patent creates standardized copies of non-standardized transaction data. The original transaction details are preserved in the source systems, while standardized copies are generated for processing through the clearinghouse. This copying approach maintains information accuracy while enabling efficient automated processing of standardized data.
Data Source
AI summary
A method implemented by a private company securities platform executing on a processor is provided. The method includes receiving an input in a non-standardized format and including non-standardized information. The method includes updating the non-standardized information into a standardized order format to generate a security order including standardized order data. The method includes automatically generating and transmitting a first notification including the standardized order data to an issuer. The transmitting of the first notification triggers a countdown for a transaction approval for the issuer. The method includes automatically generating and transmitting second notifications to all parties to the security order. The second notifications requests signatures for a transfer agreement including the standardized order data.