Morgan Stanley has struck a deal to acquire EquityZen, a prominent platform for trading shares in private companies, marking a significant push by the Wall Street giant into the burgeoning world of unlisted equities. The acquisition, announced on Tuesday, positions Morgan Stanley to capitalize on the growing investor appetite for stakes in high-growth startups that remain outside public markets. EquityZen, founded in 2013, operates as a marketplace where employees and early investors in private firms can sell shares to accredited buyers, providing liquidity in an otherwise illiquid space.

This move comes amid a broader trend where traditional banks are seeking to bridge the gap between public and private investments, especially as valuations of tech unicorns soar. According to a report from BusinessWire, the deal enhances Morgan Stanley’s offerings in wealth management and investment banking, allowing clients to access shares in companies like SpaceX or Stripe without waiting for an IPO.

Strategic Expansion in Private Markets

Under the leadership of new CEO Ted Pick, who took the helm earlier this year, this acquisition represents Morgan Stanley’s first major deal and underscores a strategic pivot toward private markets. Pick, a veteran of the bank’s investment banking division, has emphasized diversifying revenue streams beyond traditional trading and advisory services. EquityZen’s platform, with over 800,000 registered users and a track record of facilitating 49,000 trades across 450 companies, brings a ready-made ecosystem that integrates with cap table management tools, making it easier for private firms to manage secondary transactions.

Industry analysts note that this acquisition aligns with Wall Street’s race to meet demand for private investments, as highlighted in a Reuters article. Major institutions like Goldman Sachs and JPMorgan have similarly invested in private market platforms, but Morgan Stanley’s buyout of EquityZen could give it an edge by directly owning the technology and user base.

Implications for Investors and Startups

For Morgan Stanley’s wealth clients, particularly high-net-worth individuals and family offices, the integration of EquityZen’s capabilities means broader access to pre-IPO opportunities, potentially boosting returns in a low-interest-rate environment. The platform’s focus on issuer-aligned marketplaces ensures that trades comply with company restrictions, reducing risks for both sellers and buyers. A Bloomberg report details how this deal reflects the bank’s ambition to deepen relationships with fast-growing startups, offering them liquidity options without the need for public listings.

However, challenges remain, including regulatory scrutiny over private market trading and the need for seamless integration. EquityZen’s technology will likely merge with Morgan Stanley’s existing private equity tools, such as those from its investment management arm, to create a more comprehensive suite.

Broader Industry Shifts and Future Outlook

The transaction, expected to close in early 2026 pending regulatory approvals, arrives at a time when private markets are exploding, with unlisted companies commanding eye-popping valuations. As noted in the Financial Times, this appetite stems from prolonged delays in IPOs due to market volatility, pushing investors toward secondary markets. Morgan Stanley’s move could pressure competitors to accelerate their own private market strategies, potentially leading to more consolidations.

Looking ahead, insiders expect this acquisition to not only expand Morgan Stanley’s footprint but also influence how private companies approach liquidity events. By providing structured access to shares, the bank may help stabilize valuations in the private sphere, benefiting founders and employees alike. Terms of the deal were not disclosed, but sources familiar with the matter suggest it’s a bet on the long-term shift toward hybrid public-private investment models.

Competitive Dynamics and Regulatory Considerations

Competition in this arena is fierce, with platforms like Forge Global and Carta also vying for dominance in secondary trading. Morgan Stanley’s acquisition, as covered by InvestmentNews, signals a deeper commitment to fintech integration, potentially setting a precedent for how legacy banks adapt to digital disruption. Regulators, meanwhile, will watch closely to ensure that increased trading doesn’t exacerbate inequalities in access to high-return investments.

Ultimately, this deal positions Morgan Stanley at the forefront of a transforming financial ecosystem, where the lines between public and private capital are blurring. For industry insiders, it’s a reminder that innovation in private markets isn’t just about technology—it’s about creating value in an era of extended private company lifecycles.