Summary of Charles Schwab's Acquisition of Forge Global Company and Industry - **Company**: Charles Schwab (NYSE:SCHW) - **Acquisition Target**: Forge Global - **Industry**: Financial Services, specifically focusing on investment and wealth management, with an emphasis on private markets and alternatives Core Points and Arguments 1. **Acquisition Announcement**: Charles Schwab announced the acquisition of Forge Global, aiming to enhance its offerings in the private market space and democratize access to private company investments [2][6][36] 2. **Market Position**: Schwab serves nearly 46 million client accounts with $11.59 trillion in assets, leading in RIA custodial assets and retail trading [6][8] 3. **Private Market Growth**: The private market is experiencing significant growth, with the median age of VC-backed IPO companies increasing from 6 years in 2000 to 14 years in 2024, leading to a decrease in IPOs by 85% [11][13] 4. **Forge's Capabilities**: Forge has facilitated over $17 billion in private market transaction volume and has a robust platform with more than 3 million unique users and 625 private firms [8][9] 5. **Revenue Diversification**: The acquisition is expected to diversify Schwab's revenue streams, particularly as private market transactions grow and become a more significant part of the investment landscape [8][15][37] 6. **Client Access**: The deal will provide Schwab clients with access to a best-in-class experience across public and private markets, enhancing their investment options [38][39] 7. **Synergies and Integration**: The integration of Forge's capabilities is anticipated to create synergies across Schwab's existing business lines, including retail, RIA, and stock plan services [10][37][70] 8. **Future Growth Potential**: The acquisition is expected to enhance Schwab's organic growth, particularly among high net worth clients seeking alternative investments [65][68] Additional Important Content 1. **Transaction Details**: The acquisition is structured as an all-cash deal at $4.45 per share, valuing Forge at approximately $660 million, with expected closing in the first half of 2026 [36][37] 2. **Client Overlap and Cross-Selling**: Schwab sees significant cross-selling opportunities by bringing Forge's capabilities to its existing client base, particularly in the RIA community where alternatives are underrepresented [42][50] 3. **Institutional Relationships**: Forge's existing relationships with over 625 private companies will enhance Schwab's ability to serve these firms and their employees, particularly in stock plan administration [53][56] 4. **Market Trends**: The global capital allocated to alternatives is projected to surge from $4 trillion today to $13 trillion by 2032, indicating a substantial market opportunity for Schwab [13][14] 5. **Client Experience Enhancements**: Schwab plans to roll out Forge's offerings to ultra-high net worth investors and expand access to retail clients, enhancing the overall client experience [28][29][70] This summary encapsulates the key points from the conference call regarding Charles Schwab's acquisition of Forge Global, highlighting the strategic importance of the deal in the context of evolving market dynamics and client needs.

Acquisition Overview - Schwab is acquiring Forge Global to enhance its presence in private markets[1, 41] - The acquisition aims to create a best-in-class experience for individual investors and RIAs in both public and private markets[10, 36] - The deal involves Schwab acquiring all outstanding common stock of Forge for $45 per share, equating to an implied equity value of $660 million[34] - The transaction is expected to close in the first half of 2026, subject to regulatory approvals and customary closing conditions[34] Forge Global's Key Metrics - Forge operates a technology-enabled marketplace for trading shares in pre-IPO companies, founded in 2014[12] - Forge's platform has facilitated over $17 billion in private market transaction volume[11, 13] - The platform supports trading in over 625 private companies and has over 3 million unique users[11, 13] - Forge's private asset AUC (Assets Under Custody) is over $18 billion[13] - Forge's total revenue grew by 24% from Q2 2024 to Q2 2025[13] Market Trends and Opportunities - Industry trends indicate a growing interest in private markets due to companies staying private longer and a decline of approximately 85% in the number of IPOs per year since 2000[14, 15] - Median IPO valuations are up more than 3x versus 2000[15] - Private wealth capital allocated to alternatives is expected to reach approximately $13 trillion by 2032, representing a 13% CAGR (Compound Annual Growth Rate)[16, 19] Strategic Benefits for Schwab - The acquisition diversifies Schwab's revenue mix and supports long-term organic growth[38, 40] - It enhances Schwab's competitive positioning and evolves its offerings to retail and RIA clients[38, 40] - The acquisition strengthens Schwab's Workplace Services solution set[38, 40]