Capital idea: Pacific Stock Exchange.

• Author: Gardner, Gary
• Position: Where small Pacific northwest companies can raise capital with smaller stock offerings

Born in the 1880s, San Francisco's Pacific Stock Exchange is a market where small companies from Alaska and other Pacific states can raise capital.

You run a medium-size company that has grown over the years, but needs new capital to expand into more profitable areas. You've about exhausted your bank lines of credit, personal funds and private investors - what do you do? You're too small to float a stock offering on the Big Board or even on NASDAQ, so a stock initial public offering (IPO) is out of the question. Or is it?

Over the years, regional stock exchanges have played an important role in enabling smaller companies to raise capital by listing and trading on an exchange in their early and formative years. Pacific Northwest companies will soon be able to raise needed capital with smaller stock offerings, traded on the only regional stock exchange set to handle the needs of small-capitalization stock trades, and with a vehicle that provides liquidity for the investor, making a small-cap stock offering much more attractive.

On the West Coast, the Pacific Stock Exchange (PSE) has been trading business stock since the San Francisco gold rush days in the 1880s. The PSE's roots date back to the San Francisco Stock and Bond Exchange that was formed in 1882, and traded mostly mining stock. By the 1920s, the PSE was trading over 120 stocks, and had ties to the New York Stock Exchange via California's first ticker tape machine.

In 1899, the Los Angeles Oil Exchange was founded to handle the securities of the burgeoning oil business taking shape in that area. That exchange also flourished along with California's economy and the early oil boom, and soon became a major economic force in Southern California.

As the West Coast economy grew, so did the two exchanges, and in 1957 the San Francisco and Los Angeles exchanges merged to form the Pacific Coast Stock Exchange. The merger consolidated the books of both exchanges, but kept two trading floors, thus creating the only U.S. exchange with operations in two geographically separate locations.

From these gold rush era beginnings to its present-day position as one of the nation's leading exchanges, the PSE has been an important resource for investment capital and the birthplace of some of the West Coast's biggest companies. PSE alumni include Conoco, Unocal and McDonnell Douglas.

Today, 115 years since PSE's founding, its imposing 1930s temple-fronted building with Art Deco sculptures is a landmark in...