Of all the star signs, Pisces is most strongly associated with imagination. The City of London needs all it can get. A new scheme dreamt up by the government and London Stock Exchange for trading unlisted equities is not going to solve all of its problems, but it could still bring a useful dose of dynamism.
The basic idea behind the initiative, known in full as the Private Intermittent Securities and Capital Exchange System, is to let private companies use the plumbing of stock exchanges to facilitate one-off trades, without the long-term commitments of a full listing.
London faces several challenges: one is losing its reputation as a top-tier venue for public listings; another is gaining a reputation as an inward-looking island that trades on past glories but struggles with growth or innovation.
Pisces can’t really help with the first one. The relative lack of liquidity for UK-listed stocks is an enduring challenge. But on the second problem — perceived stuffiness — the project could pay dividends.
The centre of gravity in global finance — not just in the UK — has been shifting away from public markets. Goldman Sachs chief David Solomon is among those who have questioned the point of IPOs. But if companies stay private for longer, employees and early investors will still want to cash out. Institutions, meanwhile, will be keen to buy in early to capture more of the upside, rather than wait for a listing.
Evidence from the US suggests there is demand for systems that ease the process. Nasdaq Private Market — which is also backed by big banks like Goldman Sachs and Morgan Stanley — facilitated almost $7bn of trades last year. Rival Forge Global handled $1bn in the first nine months of 2024.
Encouraging a British version of those trading platforms at least shows that the government and regulators are reading the room, and could give London an edge over its European, if not American, counterparts.
Pisces is more likely to appeal to minnows than whales. The likes of SpaceX or Stripe may prefer to tightly control their shareholder registers, leaving London to lure predominantly small to mid-sized groups. That’s no bad thing: the UK has long had a reputation for struggling to support so-called “scale-ups” that are close to critical mass but not yet ready to go public.
The more straightforward critique, though, would be that things are simply taking too long. Labour picked up the project from the previous Conservative government, which had been talking about this since 2022. It was supposed to have started operating in at least a limited capacity by the end of last year. It is good to build a reputation for creativity; less good, as those who live with Pisceans know, to spend too long daydreaming.
nicholas.megaw@ft.com
