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IEX Makes Money, But Lack of Rebates Could Slow Growth

  • IEX has been profitable for 13 months as a dark pool
  • Investors Exchange preparing to begin trading in August
Updated on

IEX Group Inc. has been profitable for more than a year, using a business model that veers away from the revenue models of established stock exchanges.

The stars of Michael Lewis’s “Flash Boys,” who a month ago won regulatory approval to open the 13th U.S. stock exchange, run a private trading venue that has made money for the past 13 months, Chief Executive Officer Brad Katsuyama said in an interview. The next challenge will be snatching volume away from exchanges that pay rebates to spur business, something IEX refuses to do because its founders say it creates conflicts of interest.