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The 2016 Tech 50: Seth Merrin

The Liquidnet Holdings CEO jumps to No. 22 on this year’s Tech 50 ranking.

< The 2016 Tech 5022Seth MerrinChief Executive OfficerLiquidnet HoldingsLast year: 23

“Our goal is to make markets more efficient,” Seth Merrin says. “The only way we know how to do this is with technology.” Merrin is proving the point with 15-year-old trading platform operator Liquidnet Holdings, and not for the first time. Three decades ago he left a risk arbitrage trading job at CIBC Oppenheimer to start Merrin Financial, which transformed buy-side trading with its invention of the order management system. After co-founding another start-up, application-integration software company VIE Systems, in the 1990s, Merrin launched Liquidnet, a pioneering dark pool handling large block orders — currently averaging more than 42,000 shares ($1.8 million principal) — that are difficult for investment managers to execute on open exchanges. More than 800 member firms with $14 trillion in combined assets under management are currently trading in 44 markets around the world. New York–based Liquidnet’s first-quarter U.S. average daily volume of 46 million shares was up 21 percent year-over-year, and the firm also set records in other regions. Last September, with Liquidnet Fixed Income, the firm brought its ethos of reinvention into the corporate bond market, setting a minimum order size of $500,000. “It’s pretty absurd if in this day and age you can only trade a bond through a human being,” Merrin says. The platform now has 135 member firms trading $2 billion in corporate names, and the 56-year-old CEO anticipates steady growth because “people in this industry need to see you’re the winner” before later adopters will sign on. Merrin expects further opportunity in equity execution and quantitative services, filling gaps left by the retreat of big, capital-constrained banks. Liquidnet has developed an electronic “high-touch trader” to provide copilotlike order advice and monitoring. Targeted Invitations, launched in Europe late last year and available globally as of April, extends the block-trading model by “taking on one of the last bastions of inefficiency for the buy side: the sales trading process,” according to Merrin. These targeted block trades have been averaging 98,000 shares.

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 The 2016 Tech 50 Click below to view profiles
1. Catherine
Bessant
Bank of America Corp.2. Jeffrey SprecherIntercontinental Exchange3. Lance UgglaMarkit4. Phupinder GillCME Group5. Shawn Edwards and Vlad KliatchkoBloomberg6. R. Martin ChavezGoldman Sachs Group
7. Robert GoldsteinBlackRock8. Adena FriedmanNasdaq9. Deborah HopkinsCiti Ventures10. Daniel ColemanKCG Holdings11. Stephen NeffFidelity Investments12. David CraigThomson Reuters
13. Michael SpencerICAP14. Michael BodsonDepository Trust & Clearing Corp. 15. Charles LiHong Kong Exchanges and Clearing16. Chris ConcannonBATS Global Markets17. Blythe MastersDigital Asset Holdings18. David RutterR3CEV
19. Neil KatzD.E. Shaw & Co.20. Lee OleskyTradeweb Markets21. Richard McVeyMarketAxess Holdings22. Seth MerrinLiquidnet Holdings23. Robert AlexanderCapital One Financial Corp.24. Brad KatsuyamaIEX Group
25. Antoine ShagouryState Street Corp.26. David GledhillDBS Bank27. Lou EcclestonTMX Group28. Andreas PreussDeutsche BÖrse29. Dan SchulmanPayPal Holdings30. Scott DillonWells Fargo & Co.
31. Mike ChinnS&P Global Market Intelligence32. Craig DonohueOptions Clearing Corp.33. Gary NorcrossFidelity National Information Services34. Steven O'HanlonNumerix35. Sebastián CeriaAxioma36. Michael CooperBT Radianz
37. Tyler KimMaplesFS38. Neal PawarAQR Capital Management39. David HardingWinton Capital Management40. Chris CorradoLondon Stock Exchange Group41. Brian ConlonFirst Derivatives42. Jim MinnickeVestment
43. Stephane DuboisXignite44. Mazy DarOpenFin45. Yasuki OkaiNRI Holdings America46. Kim FournaisSaxo Bank47. Jock PercyPerseus48. Robert SchifelliteBroadridge Financial Solutions
49. Brian SentanceXenomorph Software50. Pieter van der DoesAdyen