The Beijing Stock Exchange (BSE) has experienced a boom in listings just four years after its launch. Often regarded as the underdog of China’s financial markets, the exchange is rapidly gaining popularity with tech startups and small firms.
The BSE has received 113 applications for initial public offerings (IPOs) in 2025, according to Wind, a data provider. This is more than the mainland’s two largest exchanges, in Shanghai and Shenzhen, combined. The BSE 50 index has also risen 37.6% this year, compared with 2.5% for the country’s benchmark CSI 300, according to a Financial Times report.
When Xi Jinping, the Chinese president, launched the BSE in 2021, it was quickly dismissed by investors and analysts. But recent gains have reshaped market perceptions. The exchange appears to be hitting its stride in 2025, fuelled by looser listing requirements and investor interest in local small-cap technology stocks.
In stark comparison, just nine firms listed on the London Stock Exchange (LSE) this year. As the British government seeks to attract more listings and accelerate growth in the UK’s capital markets, it could learn some lessons from China’s smallest stock exchange.
Champion SMEs
The success of the BSE highlights the power of a financial ecosystem that supports and incubates small and innovative businesses. It was designed specifically to serve SMEs, which might struggle to meet the stricter criteria of larger exchanges.
The UK could benefit from establishing or empowering a similar market. Although it provides strong early-stage support through initiatives such as the enterprise management incentive, there’s a missing middle. After companies raise seed funding or early venture capital, many face difficulties finding follow-on funding to bridge the gap to a listing.
An SME-focused market could help UK firms raise growth capital domestically, keep innovative businesses from seeking funding or IPOs abroad and close the funding gap that holds many high-potential firms back.
Prioritise accessibility and speed
Beijing’s exchange has won listings in part by being nimble. It has the most relaxed IPO requirements of any Chinese market, making it attractive for smaller tech firms. The BSE’s four-tiered listing standards mean that early-stage IPO hopefuls are not required to meet profit and revenue thresholds to list.
The exchange also launched a generative AI tool to streamline checks of IPO documents. Vetting these documents can take several days or even weeks. But the new AI tool could complete the task in just 30 to 40 minutes, experts say.
The UK’s new listing reforms reflect some of the strategies implemented in Beijing, such as lowering the barriers to entry. But more could be done to improve accessibility without further deregulation, which risks deterring high-quality firms and investors. The LSE could expand the use of fintech solutions to speed up listing processes, reduce errors and lower administrative costs.
Emphasise diversity and inclusion
By focusing on smaller firms, the BSE is diversifying its market. Businesses listed on the Beijing exchange include battery manufacturers, machine tool companies and a manufacturer of data centre cooling equipment.
If London hopes to remain a global IPO centre, it must broaden its listing base beyond blue-chip firms. For instance, there are many promising companies in biotech, technology and the creative industries seeking to access capital. Constituents of the FTSE 100 hardly fire the imagination. They are the same plodding banks, insurers, oilers and miners as two decades ago. Firms in new industries should be encouraged to list in Europe’s largest capital market.
Democratise investing
The BSE actively promotes retail investing via digital platforms, mobile apps and public education.
Conversely, London’s markets are dominated by institutional investors. By modernising investor access through partnerships with fintech platforms and integrating financial literacy into national curricula or public campaigns, the UK could help to broaden the investor base for growing companies and strengthen the capital market ecosystem.
Strategic direction without full control
The BSE offers a blueprint for how governments can nudge capital without heavy-handed intervention.
The logic behind Beijing’s exchange is to channel capital into industries that the Chinese government deems strategically important, such as clean tech, semiconductors and advanced manufacturing. Instead of handpicking winners through subsidies or mandatory lending quotas, the Chinese Communist Party is using the BSE to signal its priorities, while letting investors decide which companies to fund.
This approach relies on good old-fashioned market discipline – the belief that investors will fund the most promising businesses.
Foster local growth
Many BSE-listed companies have evolved straight from regional ecosystems or local-government initiatives.
The UK would benefit from more equitable investment across the country, rather than relying on London to buoy the country’s reputation as a financial heavyweight. There’s a huge amount of growth potential outside the capital that would benefit from regional feeder programmes and local success stories.
Uncertainty does not spell doom
The BSE was strategically launched in 2021 during a period of heightened economic uncertainty, both domestically and globally. Volatility often punishes profitless or early-stage firms, but the BSE instead offered them a tailored listing route. The exchange gave small firms a non-bank path to capital just as credit conditions tightened and enabled eager retail investors to fund domestic growth.
The UK should take advantage of political uncertainty in the US, where unpredictable policies have made London more attractive for foreign listings. For example, as US political divisions grow over ESG, the LSE can double down on its carbon-trading and sustainable-finance platforms.
The Beijing Stock Exchange (BSE) has experienced a boom in listings just four years after its launch. Often regarded as the underdog of China’s financial markets, the exchange is rapidly gaining popularity with tech startups and small firms.
The BSE has received 113 applications for initial public offerings (IPOs) in 2025, according to Wind, a data provider. This is more than the mainland's two largest exchanges, in Shanghai and Shenzhen, combined. The BSE 50 index has also risen 37.6% this year, compared with 2.5% for the country’s benchmark CSI 300, according to a Financial Times report.
When Xi Jinping, the Chinese president, launched the BSE in 2021, it was quickly dismissed by investors and analysts. But recent gains have reshaped market perceptions. The exchange appears to be hitting its stride in 2025, fuelled by looser listing requirements and investor interest in local small-cap technology stocks.
