The new marketplace is called Tech Innovation Board, is debuting on the Shanghai Equity Exchange and requires RMB 3 million in net assets for a company to list.
Approximately 50 firms are in the first group of companies to be listed, many from Zhangjiang Hi-tech Park, located in Pudong, Shanghai. Beijing has a similar innovation zone, called Zhongguancun, but its business ecosystem is complemented by the New Third Board, that was launched in 2012.
Growth enterprise boards are a great launch pad for companies and successful issuers often go on to list on bigger exchanges, as they have reporting track record and a transparent shareholder structure in place - a big attraction for investment banks, that will have less pre-IPO work to do. Chinese brokerages will likely follow the new board closely to spot companies that are ready for major exchanges.