For most startups, liquidity has usually been something that isn’t thought about in too much detail until the very end. Whilst you may consider your exit strategy in the early stages, you won’t get a tangible sense of liquidity until later down the line.
Until then, equity and value largely sits on paper.
The UK has introduced PISCES (the Private Intermittent Securities and Capital Exchange System), which is the country’s first regulated framework for trading private company shares through structured trading events.
For companies, it creates a potential route to shareholder liquidity while staying private. For investors, it opens up regulated access to private company shares.
And for founders, employees, angels, and other shareholders, it introduces a more structured path to turning private equity into cash without needing a formal exit event.
That doesn’t mean every startup can suddenly start running secondary share sales tomorrow, but it does mean that the way founders think about equity, retention, liquidity, and long-term ownership is beginning to change.
PISCES isn’t a stock exchange, IPO, or fundraising mechanism. Companies using PISCES are not issuing new shares in exchange for capital.
Instead, PISCES facilitates secondary sales, meaning existing shareholders can sell their shares to other investors during specific trading windows.
If a founder sells shares through PISCES, the money goes to the seller, not the company. The business itself stays private, and companies are able to retain far more control than they would in a public market environment.
Trading is also intermittent rather than continuous, meaning there’s no live public market where shares constantly change hands. Instead, approved operators such as Vestd can run structured trading events at set intervals.
Companies can maintain control over the event, being able to decide when they happen, who can participate, which shares can be traded, and even set pricing parameters.
In many ways, PISCES allows companies to access the flexibility and structure of public markets into private company shares, without being forced into a full exit event.
Regardless of a company’s readiness to use PISCES, the shift in businesses unlocking secondary liquidity early matters to all businesses, not just those actively participating.
This is because once secondary liquidity becomes more commonly available in private markets, conversations and expectations around equity may shift too.
Employees may start asking different questions, investors think differently about their ownership stake, and founders may incorporate different liquidity routes into their growth journey, rather than a single exit event.
All of these change how equity functions within a business.
Historically, equity has relied on the belief of shareholders that value may be realised at some point down the line.
Employees are motivated by options on the promise that they’ll convert through a single event such as an acquisition or sale. Investors provide capital without knowing if their returns could take ten years.
Secondary markets open up opportunities for shareholders to realise value more frequently. If there’s a credible future route to selling shares, even intermittently, equity becomes more tangible and real to those receiving it.
One of the biggest challenges business owners face is transparency around real share value. A team member may hold a valuable stake through an EMI or growth share scheme, but without liquidity, that value can often feel distant and theoretical.
Where PISCES becomes particularly valuable for founders is that it creates a more credible path to liquidity in private markets.
When employees and other shareholders can see a clearer route to realising value, equity becomes more tangible. Understanding these options and communicating them clearly can help build trust, strengthen alignment, and reinforce the value of ownership.
PISCES strengthens the link between ownership, value, and reward, which can change the narrative significantly, and strengthen the appeal of long-term commitment.
It’s no longer the somewhat clouded narrative of ‘here’s some equity that may be worth something, someday’, and is instead ‘here’s some equity in a company that is building towards structured liquidity opportunities over time’.
For companies already using EMI or CSOP, qualifying options can be exercised through a PISCES sale without losing their tax advantages. For options granted before 6 April 2028, this can be written into the existing option agreement.
For shares issued on or after 6 April 2028, PISCES needs to be written into the terms from the outset.
One of the biggest risks in private investing is the lack of liquidity opportunities. Investors can be locked into positions for years without clear exit routes outside of acquisitions and IPOs. PISCES introduces another opportunity.
A company intending to run structured secondary events potentially offers investors a clearer route to partial liquidity without needing a full company exit.
This could instil more confidence in investors with regards to governance and company culture, and allows equity to go beyond operational admin and become incorporated into the company’s infrastructure.
Clean cap tables, clear shareholder rights and restrictions, and organised shareholder records all become even more important when ownership becomes more fluid. Get all of these right from the start, and your business case is strengthened ahead of a funding round.
It’s important to note that PISCES and IPO are not interchangeable. The two serve different purposes and function very differently, for both the shareholders and the business.
An IPO creates a fully public company with continuous trading, broader investor access, and significantly more detailed disclosure obligations.
PISCES is intended to unlock liquidity whilst remaining a private company. Trading happens in scheduled windows. Access is restricted to eligible participants. Companies control who can buy shares and under what conditions.
Whilst some may use PISCES as a stepping stone towards an IPO, some may use it to stay private for longer whilst keeping shareholders on board and incentivised.
When used correctly, PISCES unlocks more liquidity options for shareholders without the need to open up to the public market.
The takeaway shouldn’t be ‘we need to prepare for PISCES immediately’. However, being prepared for where the market is heading, and knowing how this may affect your growth journey is key.
Some key steps to help you:
In many ways, preparing a company for future liquidity is simply keeping your ducks in a row from day one, and ensuring you’re building a healthy company in the first place.
Vestd is now an approved PISCES operator, helping shape how private company share trading evolves in the UK. We are designed to operate without financial intermediaries, creating a simpler, more direct experience for investors and shareholders.
For more information, book a call with the team to explore what PISCES could mean for your company.