How PISCES works for investors

 

PISCES provides a regulated framework for trading private company shares, accessible to a range of eligible investor types, from institutional funds and family offices to high-net-worth individuals and employees of participating companies.

For many of these investors, private company equity has historically been difficult to access in a structured, transparent way. PISCES changes that.

Here, we look at who can participate, how trading events work, what due diligence looks like in a PISCES context, and what happens after a trade settles. 

Our team, content and app can help you make informed decisions. However, any guidance and support should not be considered as 'legal or financial advice.'

Investing through PISCES

1. Access rules
2. Trading events
3. Due diligence
4. Post-event
5. The benefits
6. The risks

1. Access rules

PISCES is not a public market. Access is restricted under the PISCES Sandbox Regulations 2025 to specific categories of investor, broadly defined as follows:

• Institutional investors, including pension funds, asset managers, and investment firms
• High-net-worth individuals, as defined under the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005
• Sophisticated investors, both certified and self-certified, under the same Order
• Employees and directors of the participating company or its immediate corporate group
• Those providing consultancy or managerial services to the participating company or its group
• Trustees of employee share schemes and employee benefit trusts

Most retail investors are excluded. This is deliberate, as the FCA's framework is built on a "private-plus" approach that assumes participants have the financial knowledge and risk tolerance to engage in private market trading without the full protections that apply in public markets.

Employees and directors occupy a slightly different position. They are included specifically so they can participate on both sides of a trade, selling shares they already hold, or buying more if they choose to. Employees of participating companies do not need to meet the high-net-worth or sophisticated investor thresholds that apply to external buyers.

Beyond the FCA's baseline categories, individual operators can apply additional restrictions.

So a company running a permissioned auction can exclude specific investors or investor types, competitors being the most obvious example, provided there is a legitimate business reason for doing so.

2. Trading events

To participate in a trading event, investors must go through an authorised intermediary on the relevant platform, which verifies eligibility and facilitates the trade on the investor's behalf. The specific mechanics vary by operator.

PISCES trading is intermittent by design. There is no continuous market in any participating company's shares, and trading takes place only during scheduled windows.

The frequency and format of trading events are set by the company, within the rules of the platform. Events might be monthly, quarterly, annual, or ad hoc. Each operator approaches the mechanics differently. Some will run discrete single-day auctions, others offer multi-day continuous trading windows.

Across all platforms, the FCA's framework requires operators to publish key information about each event publicly and in advance: when the window opens and closes, which shares are available for trading, any restrictions on participation, and any price parameters the company has set.

Price parameters

Companies can set a floor price, a ceiling price, or both for each event. Trading can only occur within that range. This provides companies with meaningful control over the valuation at which their shares change hands, while still allowing genuine price discovery within the defined band.

Where a company has obtained a valuation or agreed price parameters with a key investor, the basis for that valuation must be disclosed as part of the Core Disclosure information.

Auction types

Investors should be aware of the distinction between open and permissioned auctions. In an open auction, all eligible investors on the platform can participate.

In a permissioned auction, access is restricted to investors whom the company has specifically approved. Investors may need to request access to permissioned events, and access may be declined without explanation, provided the restriction serves a legitimate purpose.

3. Due diligence

PISCES is an explicitly "buyer beware" market. The FCA has built the framework on the assumption that participants who are institutional, professional, or sophisticated investors are capable of assessing the information available and making their own investment decisions without the full protections of public market regulation.

That means the burden of due diligence sits with the investor to a greater degree than in public markets.

The civil market abuse regime does not apply to PISCES, but the criminal market abuse provisions under sections 89 and 90 of the Financial Services Act 2012 do apply, so making false or misleading statements, or creating false impressions about PISCES-traded shares, remains a criminal offence.

Companies are also subject to a statutory liability standard for misleading Core Disclosures.

Investors should not assume the same level of regulatory oversight that applies to listed securities, but some protections do remain in place.

What investors receive

Before each trading event, the company must publish a Core Disclosure document, the minimum standard set by the FCA's PISCES Sourcebook.

This covers the business and management overview, financial statements for the last three years, capital structure and ownership, major shareholders, material contracts, key risks, and directors' trading intentions.

If the company has set price parameters, those must be disclosed too, along with the basis for the valuation.

Core Disclosure is provided to eligible participants via the platform’s secure disclosure arrangements. Investors also receive details of the last PISCES trading event, if one has taken place, including the price and volume at which shares traded.

Operators may also provide a mechanism for investors to submit questions to the company before the auction. Responses are made available to all eligible participants, not just the investor who asked. Companies are not obliged to answer every question, but must respond or confirm they will not be responding by the deadline set by the platform.

Liability

Companies have a statutory duty to take reasonable care to ensure Core Disclosure is accurate and not misleading. Investors who suffer losses as a result of misleading Core Disclosure may have a right of action against the company.

A higher standard applies to any voluntary additional disclosures made beyond the core requirements. A higher recklessness standard applies to any additional voluntary disclosures. Investors who believe they have suffered loss as a result of misleading disclosure should seek redress directly from the company, not from the platform operator or the FCA.

No advance assurance on valuations

HMRC has confirmed there is no advance assurance mechanism for agreeing market values for PISCES events. Investors should be aware that PISCES trade prices may be treated as market evidence by HMRC, which has implications for the valuation of any further shares or options issued to employees by the company after a trading event.

4. Post-event

Once a trading event closes and trades have settled, buyers become shareholders in the ordinary way. The company's register is updated to reflect the new ownership, and the buyer holds shares subject to the same rights, restrictions, and obligations as any other shareholder of that class.

A few important points for investors to understand about the post-event position:

Illiquidity between events

Between trading windows, there is no live market in the company's shares and investors cannot sell on demand.

The next opportunity to sell will be the next scheduled trading event, which may be months away, or may not take place at all if the company decides not to run further events or ceases participation on the platform.

This is one of the most material differences between PISCES and a public market investment, and it should be factored into any investment decision.

No ongoing disclosure obligations

Unlike public companies, PISCES companies are not subject to continuous disclosure obligations between trading events. Investors should not expect the same flow of information that comes with a listed company investment. Core Disclosure is produced before each trading event, not on an ongoing basis.

Tax treatment for buyers

Qualifying PISCES transfers are exempt from stamp duty and SDRT under the Private Intermittent Securities and Capital Exchange System Regulations 2025.

That exemption applies at the point of purchase and represents a direct saving compared to a conventional private share transfer, where stamp duty at 0.5% of the consideration would ordinarily apply.

For sellers, including founders, early investors, and employees disposing of shares, Capital Gains Tax applies to any gain realised on the disposal. The usual CGT rates and reliefs apply, including, where conditions are met, Business Asset Disposal Relief on EMI shares. The tax implications of PISCES are covered in detail on a separate page.

Takeover Code

The UK Takeover Code does not apply to a company solely by virtue of its shares being admitted to a PISCES platform. Investors should not assume that the protections associated with a public takeover process, such as mandatory offer thresholds, offer conditions, and independent advice requirements, will apply in the event of a change of control.

5. The benefits: What PISCES offers investors

For institutional investors, family offices, and sophisticated individuals, PISCES provides regulated access to private company equity that has historically been difficult to access at scale.

Bilateral private share sales are time-consuming, legally complex, and dependent on finding a willing counterparty. PISCES replaces that with a regulated, scheduled process with standardised disclosure, structured pricing, and FCA oversight (at framework-level rather than day-to-day market supervision)

The stamp duty exemption reduces transaction costs. The Core Disclosure framework,  while lighter than public market standards, provides more information symmetry than most private market transactions, where due diligence can vary considerably depending on the willingness of the company to engage.

For employees holding vested shares or exercised options, PISCES provides a structured route to realising value without waiting for a sale or IPO. The ability to sell through a regulated, scheduled event rather than navigating a complex bilateral secondary sale is a meaningful practical improvement.

And for early investors looking to rebalance, de-risk, or exit partially, PISCES allows selective liquidity without requiring the company to be sold or listed.

6. The risks: where to be cautious

PISCES is a "buyer beware" market operating within a five-year FCA sandbox. The regulatory protections are lighter than public markets, and investors bear a greater responsibility for their own due diligence.

Liquidity is intermittent and not guaranteed. A company may run infrequent events, cancel a planned event, or cease participation altogether. Between events, shares are illiquid and cannot be sold on demand. Investors should treat a PISCES investment as private market exposure with scheduled liquidity opportunities, not as a liquid holding.

Disclosure is standardised but limited. Companies are required to provide Core Disclosure before each event, but there is no ongoing reporting obligation, no requirement for a prospectus, and no civil market abuse regime.

Private markets will always favour those closest to the company. Founders, directors, and early insiders will know more than outside investors, and PISCES reduces but does not eliminate that gap.

The market is also new and there is limited public data on participation levels, pricing, or the depth of liquidity in practice. Investors should weigh this carefully, particularly when considering larger positions.

Vestd is an approved PISCES operator, supporting both companies and investors. Want to understand how PISCES fits your investment strategy or portfolio? Book a call with our team.

This is not an offer or invitation to invest. Any future investment opportunities will be subject to eligibility and regulatory checks, including verification of investor status. Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong.