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The US Securities and Exchange Commission approved the creation of the Long-Term Stock Exchange (LTSE), a Silicon Valley-based national securities exchange.

Sources in the Bay Area said technology entrepreneur and start-up adviser Eric Ries had approached the SEC in November to get legal clearance ti start the exchange.

"Ries had raised $19 million to get his project off the ground. The exchange will encourage companies to focus on long-term innovation rather than focus on quarterly earnings reports," said the source to NFAPost.

Ries is a San Francisco entrepreneur and author of The Lean Startup, a book in which he advocates for the creation of an exchange like LTSE.

“We are building a market where companies are rewarded for choosing to innovate, to invest in their employees, and to seed future growth,” LTSE CEO Eric Ries said in a statement.

When contacted, legal experts said the move will give high-growth technology companies more options to list their shares.

"The decision is a unique approach to governance and voting rights. It is expected to reducing short-term pressures on public companies," said Rajesh N Begur. Founder & Managing Partner of Ara Law.

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