 What's going on Navigation Nation? Welcome to the web class where we're gonna be talking about the new up-and-coming small exchange We've got special guest with us today Tom Sosnoff From Tasty Trade Tom. How you doing today? I'm good. How are you? I'm great. Good day great Well to start with to give our listeners some context about your background I want to go through a couple of different phases of where you've been where you've been throughout your career And and get to the point and then we're I want to end talking about the small exchange and really dive into that to get some Some questions answered on that and and tell us more about it So let's start with when you first started you were on the CBOE. You were a floor trader You're in your 20s. You are running around Chicago with with your buddies as a floor trader making a ton of money Just with as retail traders today I think we all kind of look at that with a little bit of fascination so tell us about your time as a floor trader Well, it was actually almost to I did it for almost two decades and so I think 19 years total was my time on the floor So it was you know It was kind of a I think I was in the right place at the right time. Just lucky, you know Sometimes you just you're in the you're born in the right era and and the the trading floor was Like this last crazy frontier of just Really brutal Capitalism, I mean it was it was it was almost as pure as form And and I was just a I grew up in New York and went to state school in New York and when I got a school I got a job at a brokerage firm in New York and and Met some guys out there and they said if you move to Chicago and I didn't even know honestly I was one of those New Yorkers that thought, you know The whole country ended at the end of the East River just outside of Manhattan And so I'd never been west of Pennsylvania so so I figured that Chicago was I didn't know where Chicago was and flew out to Chicago Met this guy who was gonna give me a tour of the trading floor This is I walked on the trading floor. It was the old trading floor before they had really built up any of It's kind of like an old annex to the border trade and I walked on the trading floor and I hung out for probably I don't know about half hour to an hour and everybody was yelling and screaming and I didn't have any idea What's going on, but I thought it was the coolest place in the world It looked like to me like a like it looked like the end of a race but it went on for hours like a like a like a harness race or a horse race or something like that and Everybody's just yelling and screaming and papers were flying and I was like, oh my god This is the coolest place I've ever seen so I took the job which wasn't really a job was just working for a couple of guys and and Move to Chicago and and and decided to learn the business. I lasted for you know, I lasted for 20 years and And I built a nice, you know, we built a nice prop business in a 20-year period Not everybody made it, but you know, I was one of the few and that was good You know, it was a good life And was and was there a was there a specific time or point in your floor trading career when you kind of when it clicked And you really felt like okay. I've made it Yeah, a couple of years The first year was really hard like I didn't know if I was gonna make it because I didn't I Didn't really understand the terminology and I wasn't as strong I was quick, but I wasn't as strong in math as other people were So and everything was in fractions and that was completely new to me You know adding and subtracting all these because remember options are strategic so everything comes in combinations of spreads and combinations of orders and so there was a lot of fractions and and these guys were You know all these other guys were really fast I mean they were doing it like they were like they were like mini computers way before there were computers and And my brain didn't work the same way with fractions. So it took me a little while, but by the second year I was just as fast as everybody so and So I so I made it, you know I don't know why but sometimes some people make it some people don't I just was lucky and I turned the corner probably in the Second year and and then it was pretty much, you know, I Had a nice run for 20 years and and you guys are young you're in your 20s to begin with and you run around you I've heard you tell a story about how you know you guys have you have seats at the Chicago bowls right behind the bench During the games you guys are making bets with Michael Jordan during the game Tell us tell us a little Michael Jordan story. Well, okay, this this is so So so, you know Michael is drafted By the Bulls and it's 19. It's it's just after the Olympics 1984 he's a rookie and they The Bulls were like one of the worst teams, I don't know if you remember how old are you I'm 40 40 Okay, yeah, this is this way before your time. So the Bulls are the one the Chicago stadiums are really cool place the old Chicago stadium, but the Bulls are a horrible horrible team and there's about three or four thousand people at night at the game and they They draft Michael and all of a sudden, you know, the Bulls get a little got a little You know, they got a little extra Jump in their step and they went around they couldn't sell these new floor seats So they came to all that they came to the trading offices They not just started cold calling and knocking on doors to see who would buy seats at seventy five dollars a seat when you think about it These are, you know floor seats at seventy five dollars, which for 1984 1984 was was kind of a lot of money And but we were the only crazy people making, you know crazy money back in 1984 So they offered us the two center. Oh, sorry fork four seats on center court And we were like, well, we should try them for a year and then one of my buddies kicks me and goes Hey, the Bulls stink. Let's just take the seats next to Michael Jordan So we took the four seats next to Michael instead of the four seats at center court And then we just became, you know, he was only a kid We were 25 and and he was 20, you know, 22 or something whatever the age was, you know at the time Or we were 20. I was let's see the 1984 I was I was 27 and and he was 22 or 23 and and So we all just became friends and you know, we'd go out after the gameplay poker like at my house and you know Or his at one of the guys houses and and it was just a stupid relationship that lasted for like, you know 15 years and it was kind of fun, but then he started making too much money and then and The first night we ever played poker is a good story the first night we played poker with Michael Jordan He brought a lot of money with them and he he lost it to all these traders that were there And he was so embarrassed and he ran out of money, but we made his credit good But he wouldn't take any credit from us and then and he went out and found some money came back and then the game lasted for the next 15 years and He got his money back a couple times over What a great story Isn't kind of crazy, you know, the funniest thing about Michael was that he's the only guy in the whole world That you could because we were all married and stuff You know, he's the only guy the whole world that you could have come over in the middle of week on a Wednesday or Thursday night And play cards until three or four in the morning and smoke cigars in your house and your wife would be like Can I get you guys something? They've been thrown out They're really fun, you know, it's fun I have I've lost contact with him like 15 years ago, you know, he got too big for us Gotcha forgot about the small guys, huh? No, he's just you know, his life is like a big right, right? Yeah, okay, so fast forward you leave the floor Yeah, and because you see the writing on the wall, right? You see that everything's getting computerized the the life of as a floor trader is not gonna be the same and and you and a partner Scott Sheridan correct me if I'm wrong decide to start a retail trading platform. Yes, this is true and Back when I was trading back then and I was using trade station and interactive brokers and those were those were names I mean you say that name you think of a trading platform Yeah, you guys have started something called think or swim. Yeah, so how'd you come up with that name? And what was that all about? Oh, well actually we we ran it We had a pretty successful business and we had saved We ran a prop business, you know We had a bunch of traders and they worked for us and we traded ourselves So we were pretty successful, but we at that point in 1999 I just thought like I gotta I want to do something different, you know it's time to do something different and so We took all the money we had made over the past, you know, Scott and I have been partners for like 10 15 years to that point 15 years almost and we we decided we just rolled the dice and and I came up with the name just fooling around at home, you know kind of talking to my dog and And I ran the name by Scott and he's like he didn't really care about names He's like he's like we can always change the name later, you know, because it's kind of a stupid name we'll always change it later and People like the name and we ended up, you know Wasn't our original idea to build just a brooch from there was a lot more to it But it kind of consumed us and so, you know, we got consumed in the project and we just went crazy over it for the next You know 10 years and it became our lives and That's really it. I mean it wasn't you know, we didn't do anything. We didn't do anything like Special except hire really smart people and and work really hard. I mean, that's that's it And so now so now you're a retail trader. So now you're one of us. Yeah Right and so, you know, I so we have a community of of traders and I just presented a question a few weeks ago And I and I kind of knew where it was going to go as far as what kind of answers I was going to get And I was correct and almost every single the the question I asked was what's your number one challenge as a trader And the the answers that I got were all about You know discipline emotion Trading too big fear of missing out getting into early getting out too late those kind of things As a if you can think back, I mean as a new trader What kind of what kind of suggestions do you have to help people with help newer traders? Get over those emotions or psychological issues when it comes to trading well, you know There's a I can I can I can kind of read you, you know, I kind of I'm not read you but I kind of list off, you know a series of Mechanics and steps that we that that I follow or or different tenants to kind of foundationally how I think but you know as a new trader or even Anybody that's trying to you know, turn the corner go to the next level or even get better at what they do And and by the way, let's be fair steve I think that you know over the last couple of years like I've been doing this now since 1981 But I think over the last I'm going to say two and a half or three years, you know I I've gotten to be a much better trader than I was just three or four years ago And compared to what I was 10 or 20 years ago. It's not even close like what you know What we are today just the way we think and you know how our brains process everything that we do but the key to success is And and and a lot of them are just you know, I can easily say things like just you know Like discipline that but I'm not going to the key to success is is Being able to make Decisions and being confident in your decisions and I believe that that carries over to For whatever you do So like if you're a trader great and if you're a trader who also has a business great If you're a trader that also works in another business That's great too. If you're an investor that likes trading or your investor that works somewhere else that works If you own your own business that works People that can make decisions Decision making is a skill and trading is nothing nothing, but you know decision making and so so I'm I focus most of my life now trying to engage people I call it, you know Teaching them to finance and the and the concept of teaching people to finance is is about teaching people to make decisions And I don't really care the more decisions you make The easier it becomes to make decisions and the more successful you ultimately are so when people talk about trading I mean really what is it? There's there's there's definitely a set of mechanics You can't just make decisions, you know You can't blindly make decisions But but it's the process of making as many decisions as you can That really changes the way you think about taking risk and about assessing risk about taking risk about About everything from taking losses to taking profits and everything else decisions that come Quickly to you that don't have this huge emotional hold back or or or pull back You know those are the most successful people he he or or or her who can make the quickest decisions Um is usually the most successful That's great. That's great information and and kind of along those lines and we had you on last time We had you on was in december of 2017 Wow, and And at that time I I asked you about bitcoin because it was all it was all the rage right bitcoin was over $16,000 at that point And I just asked you what what your thoughts were as a currency as you know where it was going that kind of thing and your comments What your comment was You kind of looked at it from an expected move standpoint and you said well it could be it could go as high as 30 It could go, you know under 5 and you said My bet is it's going under 5 which obviously that was a that was a great call But what what was your main for something like that? What was your main assessment of why you would make that call? Well, first of all, I'm a freak about map. So So and over the years, you know And you you give me an efficient marketplace like bitcoin and I would argue that bitcoin was in a bubble But it was also efficient and the implied volatility of bitcoin at the time You know was probably when it was 16 or 18,000 was probably approaching 150 to 200 percent So the math just suggested the expected range. That's all that was But for me, you know anytime I I've witnessed a lot of bubbles in my career And I felt like that was just a massive bubble, you know, there's a lot of ways There's no such thing as Mean reversion with respect to price. So just because something goes up doesn't mean it's going to go down There is such a thing as mean reversion with respect to volatility So so I knew that the the range of bitcoin was going to contract dramatically but So so mean reversion applies as a statistical as a statistical or math model applies to volatility But it doesn't apply to price But with respect to price, you know, there's there's kind of sometimes there's price extreme that that Seems like it's a derivative of common sense and in the case of bitcoin, you know The easiest measurement for me is Is kind of when my mom who was 85 years old at the time, you know calls me up and says, how come we're not long bitcoin? I'm pretty sure I'm pretty sure You know that my short position. I was short actually. I'm pretty sure that my short position was going to be good But there's a lot of tells out there But you know, I mean, I think bitcoin was probably the most obvious bubble Of the last, you know, last few years. I mean easily the most obvious bubble, right Okay, so continuing on you you've got thinkorswim you ended up you ended up taking thinkorswim public Was that to raise additional capital? It was not it was to acquire It was to grow our Customer base so we acquired invest tools, which was an investor education company and They had a lot of customers and And they were a public company. So it was like we we We became a public company through the acquisition of investors And you're the you're the ceo of this now public company Yeah, and so you're the one doing the quarterly conference calls giving the earnings announcements giving the earnings projections all that stuff that public companies do and To kind of drive the point home that nobody knows what's going to happen Especially from a price standpoint You knew the numbers, right? You knew the numbers before the public did but yet Even in that situation, you still can't predict what price is going to do after after you announce the earnings Absolutely impossible. In fact, so so i've been part of the public company environment when we were public our symbol was swim swim And then when we were brought out by TD Ameritrade TD Ameritrade was public and I was a party to you know, I was It was a member of their, you know Senior member so of their management committee So so I also knew the non-public, you know the non-public numbers and we would sit around and and You know just like, you know talk to each other and say, you know, do you think this is good or bad? And and you know somebody would say well, I think these numbers are great We beat by two cents and I'm like that doesn't mean, you know That doesn't mean a damn thing like I don't think people that that That run public companies have any idea what their stock is going to do When they you know when they put the numbers out. I just don't think it's possible I I I was I was easily the only trader On the senior, you know on the senior management committee at both Well, not and Scott was too at our firm But there were other board members and people that you know had had access to you know Not the material non-public information and I don't think anybody You know would have any clue what the stock would do and we for sure as even as traders Didn't even know how we would have played it if we could have played it You know, I was much more fearful of what the market would do Like when you're pushing out an earnings report in 2000 end of 2008 or early 2009 when the market's in freefall I was much more worried about oh man We have to launch an earnings report tomorrow morning when the you know when the s&p's are down 6% You know, there's no way you're gonna you're you're gonna come out smelling good in that move Yeah, so You know the answer is I don't believe that any public company I don't believe if you had the numbers on any earnings report on any company in the world You'd have any idea what to do. I don't believe if you knew what the fed was gonna do Based on interest rates that would have any you could make money knowing what the fed was about to do If they were making interest rate announcements. I just don't think it's possible I don't think it's easy. So safe to say nobody knows anything That's that's it's it's yes, that is You can just write that on the tombstone Very good. So okay, so then you sell toss to td for a cool 750 mil Yeah, and you Complete your contractual obligations with them. You don't really want to be part of of that going forward And so the next thing you do is you start and this was I think about eight years ago. You start tasty trade Yeah, that's right. And this is to provide Retail traders access to content And what was the thought process initially behind starting tasty trade? well when we sold when we sold um, I think or something to td could because um At that point, you know, I had to stay on for two years and and I did I was supposed to down for three years, but I asked them if they would let me leave and they said yes I td was a good firm and they had good people there, but um, I couldn't work in that environment. It wasn't I had been I never got a paycheck in my life I've been self-employed since I was you know, 21 22 years old and so I didn't want to live in that environment and So I asked if I could leave and I they said what are you gonna do and I said I'm gonna go start a I'm gonna go start. I'm gonna try to disrupt financial media because I think that we build really cool technology, but I don't think people Have the right content yet and the content that's being disseminated outside of brokerage platforms You know the content that's being disseminated over, you know, cnbc and bloomberg and And Reuters and and all these other places. It's not that they're disingenuous And not that they're trying to do something that that's that they know is wrong It's just they don't really understand what people, you know, what people need to learn They they don't get the math part of it. There's no strategic angle to it So we decided to disrupt try to disrupt financial media and build this crazy company called tasty trade and actually TD Ameritrade was our first investor And we built this company and we were just hey We're hoping we can pull this off and it works and all this kind of stuff and and it was pretty wildly successful and and It it just kept growing and growing and growing until it became the largest, you know, digital financial digital network in the world and In two years ago we launched tasty work. So That that's pretty much, you know, how it worked. It was fun. It's a men amazing run like I I'm so happy we did it because I I would never trade this experience for anything. It's been incredible And so you you're providing this content not only as entertaining, but it's also very Math and research driven. You build an internal think tank research team within tasty trade What what would you say is maybe the top three pieces of research that has really taken your trading to another level? Um, there's a couple things first, I never when we were floor traders it was always about trading big and my You know, it's like go big or go home type thing And I never understood the concept of trade small trade often And I didn't really understand the law of large numbers. And and so I was I it was just absolutely shocking to me, you know, how big we used to trade and how How small and active we trade right now. It's completely Different. So I would say number one. It's the trade small trade often It's it's a thousand times better way to approach, you know, this business We couldn't do that until we were effective until we were able to effectively build our own rate schedule And until we were able to build the technology that supports that but that's number one number two would be managing trades early I I don't think that I ever I think we did it by default, but we didn't do it because we knew what we were doing and After we don't research for now for eight years and this is using, you know, I mean we do 50 to 60 hours of research every single day with, you know, eight data scientists and all this other kind of stuff And the whole concept of managing early is It makes you it makes everything we do so mechanical So so there's the trade small trade often there's managing early and then I think the final pieces is we've we've become almost addicted to slash dedicated to Implied volatility rank which is which is using Which is building a measure of how we rank implied volatility on a scale of one to a hundred So that we can easily make decisions based on IV rank as opposed to making decisions based on something subjective And it's really helped us, you know, narrow It's it's it's narrowed us into using just, you know, quantitative stuff to figure out trades and nothing else So so those would be the three it's it's the dependence on implied volatility rank and to simplify the context around implied volatility It's trade small trade often And it's managing trades early and those would be the, you know, three things that that really stand out after eight years of doing research excellent and then At this point You are you're still kind of you've got it's called a marketing arrangement with td think or swim But you you don't have control over the costs and so You guys disrupt the industry again, and you start tasty works And And one of the biggest, you know disruptors was was the commission schedule Which which you initiated with zero commissions to close trades Right. Why did you why did you do zero to close trades? Why not just do a cheaper in and out? Um just because we wanted to do something different. So we decided to do cheaper We we made our rates in way cheaper than anybody else and we included out in that because we wanted to really um We felt like if we did something incredibly aggressive That it would change Not only the rest of the industry, but it would change the way people It would allow people to trade small trade often because you close a trade costs nothing and so um tasty works was Revolutionary in the sense that we could you know change the the way commissions were structured in the industry But you know it was also really close. We built technology It's very underappreciated technology because at this point it's it's it's all high frequency which nobody else has And it's it's all built to let you you know roll trades Roll trades up and down adjust trades and do everything that no other platform can do and it's all in front of you on one screen. So I there's We we we got the technology that we wanted and we got the fee structure that we wanted And we were able to embed the content that we wanted and so we feel like we give people You know, we don't charge for anything by the way, you know, nothing everything is free except the the commission So so we feel like we gave a really good offer. You know, it was a really good Um just a really good offer to people to to come on over and it's worked. It's it's fastest growing brokerage firm Um in the u.s. Fastest growing kind of traditional brokerage firm in the u.s Is there any new features or anything new coming as as it relates to the brokerage platform that that's coming that you can talk about Yeah, so well, we'll be launching portfolio margin in a couple weeks. We will be adding cash bit cash, uh digital currencies to the platform We're about to go into test mode for that. We are going to be launching something called Um a test drive platform which will allow people to actually test out our soft Software for a day or so and if they if they make a little money, you know I'm trading stocks on it. We'll let them keep it. Just it's kind of a fun little Um marketing thing we're going to be doing We're going to be launching something called option tracker option chains, which is an option tracker Which allows you to track individual positions Um from start to finish regardless of the number of adjustments and and anything like that. That's huge huge It's huge. We've been building it for two years. So I know how huge it is It's just it's a massive amount of work. We're deploying a brand new mobile a simplified mobile app And then we have a couple of We have a couple of kind of really cool little treats that we I can't talk about yet, but that are also coming that are that are That are things that don't currently exist in the industry. So we're playing around with some with some really neat little Gadgets and stuff and and you know, we also do Live shows around the country all year long. We do we're doing 27 live events this year all over the country. So we're pretty aggressive I was in Omaha for the he said she said last year. That was a really cool event Yeah, we're gonna do it this year. This year. It's fun. We're in like that was the small show We've ever done that show in Omaha last year And we wanted to try a city with 600,000 people This year we're back to a little bit bigger shows, but yeah, we loved it. That was fun Cool. All right, so let's get into what we're really here today. Thanks. Thanks for that background I think that really gives our listeners some good context of where you've been where you're going And I want to talk about this small exchange and go ahead and take over my screen whenever you get a chance but the first question I have is What what is the role of an exchange? What what do they do? You know, they create the products. They clear the orders They they are kind of the market makers at this point. Tell us what is an exchange? What what's the role? The the role of an exchange exchange is is a facilitator Yeah, don't think of the role. Um Exchanges actually don't clear the trades Um, the trades are cleared by, you know, some clearing group. It could be like occ It could be could be cme, but they're but they're not exchanges Um, and the exchanges don't fill the orders There's a market making groups all over that actually are members of the exchange that are counter party firms liquidity providers hedge funds They make markets exchanges just provide the technology and the oversight to allow for the meeting of a customer and the facilitator Or two customers to to um so they can interact and and make a trade Basically, it's kind of something so instead of person a trading with anonymous person b And that trade living, you know anonymously on on in some ledger or that trade living somewhere else This is just centrally cleared stuff That's usually that could be fungible if the products are in different places But essentially this exchange role is as a facilitator Person a meets person b and person a doesn't really care Person b is because the exchange is guaranteeing the trade and that's all it is And they and they create the product So they create the symbols and that sort of thing they create the products Or they can license the product from somebody else or they create the products and they create everything They create the symbols. They you know, they market the products everything. There's there's not that many exchanges so it's very hard to build an exchange and So why are you guys building an exchange? well one of my so i'm getting a little older and I I one of the things i've always wanted to do Is you know, I feel like we've we've really done some cool things on the broker side We've done some amazing things on the media side but one of my lifelong dreams was to disrupt the futures exchange business because I there's only two major futures exchange the cme and the ic And I feel like they're always been they've always been Designed to take care of the professional hedger or the institutional customer And they've never been supportive of the individual investor and it drives me crazy And their products are too big their fees are too high And their technology is too old and they don't have any standardization And they don't support what individual investor needs And so about 15 years ago. I started to design an exchange And I marketed it to the existing exchanges Suggest because I was busy and I had other things to do and everybody loved it But they were like, you know what? We just don't want to upset our model And so I didn't I pulled it back. I tabled it for a while and I tabled it for 10 years and then And essentially now, you know, I brought it back out, but it's very different today than I was thinking about it 15 years ago And we have the capital to do it and we have the technology to do it today And we have the desire to do it So we started a separate company Called the small exchange. We're building products for Individual self-directed investors The average Futures product right now is about a hundred thousand dollars in notional size Some are 150 like bonds and s&p's things like that and some are like, you know, 50 like Like crude oil but the average is out to over a hundred thousand dollars for one contract That's way too big when the average customer count is let's say 40 or 50 thousand dollars for traders and so We need to have products that are significantly smaller But when you have products that are significantly smaller, they need to have High enough implied volatility so they can move around a little bit So we developed products for the small exchange that are standardized Meaning they don't they don't like it's not fractions on one and Decimals on another and each ticks the same and each expiration is the same And everything's cash settled and it's so much easier to understand And the products are much smaller like the equivalent of a hundred shares of stock So an individual investor that's always been scared of futures because it's a hundred thousand dollar product Can look at these products go. It's the same as a hundred shares of you know the cues that kind of thing size-wise I can handle that with slightly higher volatility, but but But you know perfect size for me And there's a lot of other really cool features Of the small exchange and it's just it's it's got a product design That that we've been thinking about for a long time. It's got products that we build ourselves We're not using anybody else's products and most most importantly The small exchange is has a matching engine, which is the engine that drives all exchanges That we have built ourselves We've spent the last almost two years building a matching engine And so we didn't want to license the existing ones that right now most people that try to build exchange License an existing matching engine So if you go to like for example, brazil or mexico or somewhere or even in the us If somebody wants to start an exchange they just license a matching engine from an existing exchange The problem with that is you can't do anything special technology-wise We built something really special that's going to do stuff that no other exchange technology has ever done before And it's going to allow customers to trade futures the way they trade options the way they trade stocks It's going to be very very different from any futures product currently and and all that said It's a customer exchange. So we're even letting customers buy subscriptions for ridiculously low price That will eventually turn into seats when this exchange goes live And so they'll have a lifetime of half price exchange fees We're being extremely generous in giving away half of our future revenue just to get enough people on board So the exchange is successful when it launches And you know back in the day or when you had a seat on an exchange I mean first of all they were Being sold for hundreds of thousands of dollars and then later millions of dollars. I mean Should this be looked at as as somewhere you're buying a seat and you're going to be able to sell it later for a lot more No, actually we should not look at it that way because what you're buying is actually a subscription That will turn into a seat But it's not designed to be an investment because there's there's going to be a lot more of these What it's designed to do is save you a lot of money over time if you use these products Can it go up in value? Yes. Are we selling it as if it's an investment and it can go up in value? The answer is no so theoretically it can go up in value and it's going to be open for It's going to be open in an auction marketplace a cup once or twice a year But we cannot sell it that way and we won't because because our goal is not to create seats that are I'm sorry to create subscriptions that will be ultimately worth a lot of money Our goal is to create subscriptions that will allow people to be engaged in the product Like we're not interested in building, you know an equity marketplace where people are just investing so they can make money It'd be cool to do but the crowdfunding rules don't appreciate don't allow that and the And the regulatory rules do not allow for that either But they do allow for like, you know subscriptions cooperatives where you can reduce On the back end you can reduce fees And that's what we're doing and so we're playing it, you know Totally kosher. We're making sure that we we're making sure that we give Individual investors an opportunity, you know, imagine if you had bought a cosco membership that was good for life Before cosco ever launched and they said for a hundred dollars. This membership is good for life And then for the next, you know, whatever 20 30 years of your life. You had a free membership to use cosco That's worth something You know, um, that's essentially what this is. It's not something that that's that's going to be worth A lot of money, but it's something that can save you, you know, a lot of money Like my son, I'll give you an example. Steve my son when he was in college. He bought amazon prime membership for life for 30 dollars And he can't trade he can't sell it He's not he got it under some student deal where he cannot sell it He can't trade anybody. He owns it for life for 30 dollars like that's worth something to him And that's how we view this except you will be able to sell this. That's the only difference. I see And and so starting out an exchange like this I mean, where is the where's the initial liquidity going to come from to to start These new products getting volume open interest to trade between all the traders. Well, it's it's it's a hell of a challenge That's for sure. That's why that's why we're going to have between 25 and 35 000 subscribers before we even launched the exchange um, but the liquidity side has to come from from very strong partners and We recently we haven't announced it yet, but we will Hopefully within the next month announce a list of our partners Who are going to be providing liquidity to this exchange and it's going to be at least I hope it's going to be a very impressive list Of all the major players now we have an advantage over other people trying to start an exchange in that We already have a massive amount of liquidity that goes through our platform And so we already have a lot of liquidity providers that that work very closely with us and that currently partner with us So we're not like a brand new exchange coming in and saying hey, you know what please make market for us We're going to be we're promised. We're going to send you business. We already send them a ton of business and when you say So you got your liquidity providers When you say other major players, is that other brokerage firms that will be routing orders to you? Well that too, but that's not what I'm talking about. Okay. I'm saying I'm saying liquidity providers are firms that Are the firms that that currently make markets for stocks and options The exchanges all the exchanges out there today, you know, they're just facilitators So behind the exchanges are all these firms that make markets the biggest being Citadel the second biggest being burr 2 and sasca hana and and You know peak 6 and The just dash and imc and there's just there's a million firms out there Um, we route orders to all those firms And they facilitate the other side of our customer of our customer business Those firms will be also supporting the small exchange because we have partnerships already in place with with With many of them and and you know, they want You know, this is how they make money and this is so we think they're going to make pretty pretty good markets The small exchange will be offering futures options too So it's just a it's a futures exchange for launch and then it's futures options after launch, you know Maybe six months or eight months after launch. We'll start launching futures options So this exchange is going to be, you know, we're going to compete with the cme. We're going to compete with the ic They're both 70 75 billion dollar companies and here we are this little pissant, you know startup exchange and um You know, we're we're going to scare the children And and so what what's kind of the range of products that are going to be offered? Is it going to be something that gives you exposure in the Financial markets and the commodities and what was kind of a range of the products that will be offered? So um, initially we're not discussing all the products that we're going to offer but initially The range will be um, and again, we've designed all our own products, but the range of products will be You know, there'll be equity products. There'll be energy products. There'll be currency products, there'll be Bond products, debt products, treasury products, I mean There will be precious metal products. There'll be volatility products. There'll be, you know, ultimately there'll be Hopefully there'll be digital currency. There'll be cannabis They'll be, you know We're hoping in the end Initially, there'll be five or six and then followed by another five Followed relatively quickly by another five or six I see And then and you think would you say about eight or nine months afterwards options should be Coming on board on those different Products on the most liquid products. Yes. So we have to see, you know, which products that we launch Have the liquidity necessary to support an option marketplace, but um, assuming that we um Assuming that our guests is, you know, that that assuming that our hunches are right about, you know The amount of business that we can drive and and how good our products are We're hoping that there's there's a, you know, relatively vibrant marketplace for the options Within six or eight months at least on the top, you know, four or five names Cool And so for our listeners who want to get involved and everybody better be getting involved I mean, there's no reason not to it's a hundred dollar subscription fee and Is correct me? Keep uh, correct me if i'm wrong. You hit you need to be you need to have a tasty works account to get involved No, no, no. No, no if you open a tasty works account We give you the small exchange membership for free. It's our giveaway this year We pick up a hundred dollars based on what it is. Got it. You don't if you'd like to do it yourself You can just go right to the small exchange.com and sign up. There's a you have to You have to fill out a small form that you have to sign a document Which just says that this is what you want to do and then we're not even collecting any money now I think in march We'll be sending out emails to collect the money This just reserves your spot and make sure that you you know because we're going to cut this off in a We're within a few months We're going to cut this off because we're going to be oversubscribed And then when more people find out about this and so and we're not touching the money until the exchange is approved by the CFTC So it's going to be held separately. So for any reason we don't get approved or anything like that We will return all the money. We're not using it until after we're approved The exchange is fully funded. Just so you know, so we put up money. We've raised money and At this point the exchange is fully funded and we will do we're guessing we'll do a series a round on the exchange sometime later this year or early next year, but for the time being all the All the startup capital was provided by Tasty trade and peak six peak six is a very large prop firm and investment firm in in Chicago and We'll be announcing other investors very soon We have no individual investors, but we do have individual subscribers But at least but at least initially to actually trade the products that you're creating on the exchange It'll be done through Tasty works platform Tasty works and there'll be other brokers signed up. We just don't know who yet So far so far only a few brokers have already committed But we think eventually we'll get it everybody But if we don't then customers will just if they want to trade the product they'll come over to Tasty works But we think the other firms will you know We'll come over once they once they see, you know, how cool the products are and you know And how people are trading it and and listen if somebody leaves one firm to come to us to open an account They'll eventually come over You know, right Okay, I mean I don't have any other questions. I'm looking at the questions from our members I know about the about the fees You're looking at this At cutting exchange fees basically approximately in half talk a little bit more about that So we were trying to decide, you know, what's the best benefit we can give to you know to The only way the exchange makes money is on exchange fees for the product So we said If you sign up for this and as you're an early subscriber before we even you know launch Before you can get approval. We're going to give you lifetime of no membership fees No one half off exchange fees and reduced Reduced data fees and we're doing data fees very different than anybody else has ever done them before So it's something that we're trying to make this Cheaper than trading, you know anything else And so it's a lifetime of half price fees. It's a lifetime of discounted data fees And it's a lifetime of no subscription or seek fees or anything like that. It's not going to stay this way once we get approval Um, once we get exchange approval, you know, the All the all these rules for the next group in the the price is going to go up to 500 the There'll be annual fees things like that. So we have a very different, you know, this is just kind of the initial offer There's already We're approaching. I believe we're Getting close to 8,000 people are already signed up for this small exchange and it's only been announced a month ago. So You know, we're cutting it off at 25,000 And and well these with these reduced exchange fees. Does that apply just to the futures or options on futures as well? Once those are available everything everything. Yeah, sure And and this is in a this is in an approval process. You guys have applied to open this exchange And what was kind of the timeline that you're hoping or thinking this is going to come to fruition? Well, the government shutdown didn't help us last month Because these are all government cftc is a government governmental agency, but um, uh, we are expecting approval in the third quarter Third quarter. Yep q3 And our our our technology is built and our company. It's a separate company And like I said, there's there's two Fully announced partners now tasty trade and peak six But there'll be other announcements coming over the course of the next Couple of weeks and months and you'll see who else is involved and it's it's you know what steve? This is this is I would be it wouldn't be fair if I said this is anything other than a long shot because that's what it is, but you know, we've done a lot of long shots and We're we're we're very strong technologists and we're very strong disruptors in the financial space And the small exchange is a really cool Concept it is just it's simple. It's standardized and it's going to be fun That's great. And another question coming in If you have a let's let's just say you've got a tasty works account outside of the us Or you've got a brokerage account outside of the us as long as you Are approved on that broker in other countries, whatever products are available They'll be able to trade so if you're in australia and you've got a tasty works You're going to be able to trade these well tasty works is tasty works. Australia should be launching in a matter of days So australia is already covered If you're if you're an international customer listening to this listening to this webinar today You can buy this membership even if you're in canada. We the the small exchange It's individuals only and you can only buy one. It's not like you can't buy five or ten or anything like that it's for individuals only you can only buy one and And you can buy from anywhere anywhere in the world anywhere and ultimately, you know tasty works takes customers from 65 different countries But we are not yet approved in canada, but we are going through the process Australia we are we we I can say we're approved because we're 95 there We're we're just waiting for the final margin, but we will be approved and then else we're in the world It just depends what country but for most countries. We're pretty good right now What about singapore? We have one person in here in singapore sure singapore china Yes, yes, we cannot take customers from hong kong, but singapore absolutely china absolutely Everywhere in europe absolutely, you know, there's there's a couple the next country. We're proving hopefully within two weeks is colombia, but Countries that have an issue with you know money laundering just you know And it's not us. It's just the regulators. There are some countries out there that are difficult, but Like we have viewers from 168 countries, but we only can take 65 countries right now for accounts, but what about india india I need to check on india india is an issue Sometimes we have customers I think india is a yes, but I need to just you just need to send a letter to support for us I'm pretty sure india is a yes okay Well tom you have been super gracious with your time as always we really appreciate you being here Thank you so much if anybody has any doubts You know, there's there's really nothing to lose to sign up for the small exchange I would encourage everybody to do so. I've already done it and we really look forward to Hearing more about this tom. Thanks for your time. I'm available for you anytime. That was a great u.s. Great questions I appreciate it. Thanks tom. Take care everybody. Thanks everyone