Our Origins: NEO to Now

April 1, 2023

For many years, the Canadian exchange space was not very competitive, putting investors in the region at a disadvantage – especially in the Listings business.

“We didn’t feel that there was anyone in the industry in Canada that truly cared about and prioritized investors and capital raisers,” says Jos Schmitt, Senior Vice President, Head of Global Listings. “So, we set out to create a platform that solved that problem.”

In 2012, Jos began working with RBC Captial Markets to build a new Alternative Trading System (ATS) in Canada, a step toward creating more competition in the market. Together, they built out the strategy, attracted shareholders and, ultimately, created NEO, not an ATS but a full-fledged stock exchange with some unique additional features.

“The vision behind NEO was to set up as a new kind of stock exchange, focused on one core principle: always doing what is right for investors,” Jos says. “Everything we built was centered around how it would help investors and capital raisers. That garnered a lot of good will in the industry because we were finally delivering what people really needed and creating competition and innovation.”

However, it didn’t all come easily. Building a new exchange from scratch requires confidence from people across the industry who are willing to participate in the market, provide liquidity and bring in order flow. The team started with trading. Once that key component was in place, they built on their success.

"Once people began to see the excellent level of service and quality of execution we provided, things started to come together,” Jos says. “We were able to implement unique trading mechanisms and provide accessible market data, that encouraged more trading, which helped us launch our listings business.”

NEO continued to grow, becoming instrumental in creating a competitive, thriving Canadian marketplace. As the company looked to continue building on its success and grow its competitive edge, finding an established business to join forces was the clear next step.

When exploring potential strategic transactions, Cboe’s commitment to innovation, fairness, transparency and customer service, is what made it an attractive buyer, Jos explains, and the cultural fit was there too.

“Cboe is a global company now, but it still has those Midwestern roots that are similar to the Canadian way,” he says. “In our conversations leading up to the acquisition, it also rapidly became clear to me that, like NEO, the Cboe team is committed to quality execution and doing what’s best for its customers.”

Cboe completed its acquisition of NEO in June 2022 and, with NEO officially a part of the Cboe network, quickly got to work on bringing its products and solutions up North.

“We have an excellent opportunity to further increase competition in Canada, to the benefit of the Canadian capital markets and all its stakeholders, and to provide new and better capital formation options for investors and capital-raisers worldwide.”

In less than one year with NEO under the Cboe umbrella, the company has continued its steady growth and laid the groundwork for creating a best-in-class global listings offering. Leveraging the global team and local expertise, Jos says there’s no limit on what’s possible.

“We are just getting started and I can’t wait to take Cboe Canada to the next level.”