ex24 Is No More
May 31st, 2007 by Grant in: Brokers, Business, Investing, MarketingIn a case of what could be over saturation in the online discount brokerage firm field, ex24 has closed up shop.
Back in November of last year, I had a chance to speak with Anthony Link, ex24’s Chief Operating Officer. Bound with excitement, both he and James Lennane, the company’s founder had high expectations for the company.
Perhaps the expectations were too high.
Despite marketing campaigns that included iPod giveaways, free trading periods, guaranteed portfolio performance and access to fractional shares of sought-after stocks such as Google Inc. (GOOG) shortly after its initial public offering, the platform never gained momentum.
“We were looking to go further, faster, which is why we decided to call it a day,” said Anthony Link, the company’s chief operating officer. -Source
The company never made any money, and was being fed a healthy diet of capital by its founder who finally decided he’d had enough.
The company’s website has been shut down, leaving only the following message:
ex24 is sorry to announce that as of May 14, 2007 we are no longer doing business. If you have any concerns about your ex24 Member account please contact Member Support Services at (800) 524-3924.
Thank you.
ex24, Inc.
200 Patriot Way
Naples, Florida 34104
(800) 524-3924
This is a prime example of a failing business plan due to not being able to attract customers. I wouldn’t really call it a failure of marketing per se, but rather a failure of a combination of things that failed to attract any capital.
Profit margins are slim in the discount brokerage sector, and lacking clients means dwindling income.
I was never a big fan of their ATS order book concept. The idea was that individual buyers could be matched up with individual sellers through the platform itself. Effectively this would make a 24 hour market.
The problem with this idea is that it’s only useful if there is liquidity, not only in the stock but in the platform itself. It is useless if there are only 100 traders using ex24 and not one of them wants to buy your 200 shares of Google for anything above market value. The lack of volume and the thin number of available securities doomed this idea from the beginning.
Anyway, ex24 customers had the option of closing out their accounts or being transferred to Vienna, Va., brokerage firm FOLIOfn Inc.
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June 1st, 2007 at 10:29 am
FYI some further news on ex24 and how FOLIOfn is interested in other similar partners.
FOLIOfn, an innovative online securities firm,
Seeking to Partner with Small to Midsize Broker-Dealers
Vienna, Va. – May 31, 2007 — FOLIOfn, Inc., the innovative online brokerage and technology firm, announced today the completion of its acquisition of all the accounts of ex24 Inc. and its desire to acquire additional assets from other small to midsize broker-dealers.
“Because of our extraordinarily cost-efficient proprietary clearing platform we have the opportunity to expand our offering through acquisitions, partnerships or other relationships with small to midsize broker-dealers. At the same time we can offer those broker-dealers and their customers the depth of the unique FOLIOfn platform, the capability of our customized portfolios and other innovations,” says Steven M.H. Wallman, founder and CEO of FOLIOfn. “We are actively seeking other strategic acquisitions.”
FOLIOfn also provides custody and portfolio management solutions to registered
investment advisors, managed account program sponsors and other financial
intermediaries, who use FOLIOfn as a way to build, manage and deliver efficient and innovative model-driven investment and retirement solutions to their customers. “FOLIOfn has experienced tremendous (100% year over year) growth in the advisor channel over the last several years, and we expect that growth to continue,” says Greg Vigrass, President FOLIOfn Institutional. “The explosive results from FOLIOfn make it possible for advisors, and other intermediaries to offer highly customized, client-specific portfolios in a cost and time efficient manner across hundreds or thousands of client accounts.”
About FOLIOfn
FOLIOfn is an innovative online securities firm that provides a patented platform allowing investors to economically create and manage a diversified portfolio. Using listed securities, actively managed mutual funds, index funds, ETFs and other securities, investors can purchase entire portfolios in a single transaction, with no minimum, investing by dollar amount or number of shares. The company also provides a comprehensive platform for more than 150 registered investment advisory firms, independent broker-dealers, and money managers through its FOLIOAdvisor service. Founded by former U.S. Securities and Exchange Commissioner, Steven M.H. Wallman, FOLIOfn has grown into one of the largest brokerages by number of trades handled in the U.S. For more information please visit http://www.foliofn.com.