Morgan Stanley strengthens investor access to private markets with strategic acquisition of EquityZen

Morgan Stanley has announced its plan to acquire EquityZen, a leading private shares trading platform, in a move that highlights the growing importance of private markets in global investment strategies.

The deal, expected to close in early 2026, underscores the bank’s commitment to expanding access to private equity opportunities and meeting the increasing demand from investors eager to participate in the growth of high-potential startups before they go public.

With this acquisition, Morgan Stanley is taking a major step toward reshaping how investors connect with the private market ecosystem.

EquityZen, founded in 2013, has built a reputation as a trusted platform for trading pre-IPO shares and currently boasts over 800,000 registered users.

The company has facilitated more than 49,000 transactions across over 450 private firms, providing liquidity and access to a segment of the financial world that was once reserved for large institutions and venture capital firms.

The move comes at a time when the lines between public and private markets are becoming increasingly blurred. Many of today’s most influential companies, including OpenAI, SpaceX, and Bytedance, remain privately held yet hold valuations rivaling some of the largest publicly traded corporations.

For investors, this shift means that opportunities for significant returns often arise before a company ever reaches the stock exchange, creating new possibilities for wealth creation and diversification.

Morgan Stanley’s acquisition of EquityZen demonstrates a forward-thinking approach to investment innovation. By integrating a robust private trading platform within its wealth management division, the firm will be able to provide clients with more options to diversify their portfolios.

This move also enhances the bank’s ability to capture market insights, better understand evolving private company valuations, and strengthen long-term client relationships through exclusive access to emerging opportunities.

Michael Gaviser, Head of Private Markets at Morgan Stanley Wealth Management, emphasized that investor interest in private markets has grown substantially.

With more than 20 million clients across the world, the bank aims to ensure they can participate in the new wave of private investment opportunities that are reshaping global finance.

The partnership with EquityZen will serve as the bridge connecting investors’ appetite for innovation with the supply of pre-IPO equity from high-growth startups.

For EquityZen, joining forces with a global financial powerhouse represents a natural evolution of its mission. Its founder and CEO, Atish Davda, noted that the demand for private company investments is soaring, and traditional investors risk missing valuable opportunities if they remain confined to public markets.

The merger with Morgan Stanley will enable the platform to scale its reach, offering greater liquidity and streamlined access to private equity for both institutional and individual investors.

This acquisition also complements Morgan Stanley’s broader private market strategy.

The bank has been building partnerships with other key players in the startup and venture capital ecosystem, including its previous collaboration with Carta, a leader in shareholder management and stock plan administration.

These alliances position Morgan Stanley as a central hub for private equity access, giving clients a comprehensive suite of tools to invest in innovative, fast-growing enterprises before they reach the public stage.

The timing of this deal is particularly significant, as global investors continue to seek alternatives to traditional public market assets. With many private companies delaying their initial public offerings, demand for pre-IPO exposure has surged.

Morgan Stanley’s integration of EquityZen’s platform will not only enhance liquidity but also open the door for more transparent, efficient, and accessible trading in the private market space.

The acquisition reinforces Morgan Stanley’s reputation as a leader in wealth management and investment innovation. By embracing new technologies and emerging market structures, the firm is empowering clients to navigate the evolving financial landscape with confidence.

The move also highlights how traditional banking institutions are adapting to meet the needs of a new generation of investors—those who value access, agility, and early participation in breakthrough companies.

Looking ahead, the merger between Morgan Stanley and EquityZen is expected to set new standards for how private investments are made available to everyday investors.

Once completed, the acquisition will likely result in the creation of integrated tools that connect clients with both pre-IPO opportunities and other alternative assets.

The goal is to democratize access to high-growth investments while maintaining the same level of security, compliance, and expertise that Morgan Stanley is known for.

As the global financial ecosystem continues to evolve, this partnership represents a strategic alignment between innovation and legacy.

EquityZen brings deep expertise in private markets and technology-driven trading, while Morgan Stanley contributes its scale, credibility, and global reach.

Together, they are poised to redefine how investors engage with private markets and to shape the next generation of wealth creation.

The concept, referred to as a “payment account,” was outlined by Federal Reserve Governor Christopher Waller during a payments-focused conference held in Washington.

The proposed “payment account” would allow companies that currently depend on traditional banks or third-party intermediaries to connect directly to the Fed’s payment systems.

However, these accounts would not grant the same privileges as full bank master accounts, such as access to the Federal Reserve’s lending facilities or interest-bearing reserves.

Instead, they would provide limited, secure, and direct access for firms that perform payment-related activities but are not regulated as banks.

Waller emphasized that the initiative remains in the prototype stage, with no formal decisions yet made. The central aim is to explore how the Federal Reserve can modernize its approach to payments while maintaining financial stability and regulatory safeguards.

“Payments innovation moves fast, and the Federal Reserve needs to keep up,” Waller said in his remarks, noting that the evolving financial landscape now includes a wide range of participants — from traditional institutions to fintech startups and nonbank payment platforms.

The proposal reflects the Fed’s recognition that the financial ecosystem has changed significantly in recent years. Digital wallets, fintech firms, and real-time payment networks have reshaped how consumers and businesses transfer funds.

Many of these entities currently depend on partner banks to access the Fed’s payment rails, such as the Automated Clearing House (ACH) or Fedwire. The creation of a streamlined “payment account” could simplify this process, offering firms a more direct yet controlled entry point.

Under Waller’s vision, these accounts could come with several key limitations to ensure stability and minimize risk. For example, the accounts might be capped in balance size, not pay interest, and prohibit overdrafts.

They would not qualify for emergency borrowing through the Fed’s discount window, a privilege traditionally reserved for insured depository institutions.

However, firms applying for these accounts might benefit from a more efficient approval process, tailored to their operational scope rather than the broader requirements placed on banks.

This proposal also addresses ongoing debates about how far the Federal Reserve should go in granting nonbank entities access to its payment infrastructure.

Fintech companies and other payment providers have long argued that direct access would enhance competition, efficiency, and innovation in the financial sector.

Conversely, critics worry that expanding access could expose the central bank to greater operational and regulatory risks, especially if nonbank firms are not subject to the same stringent oversight as traditional financial institutions.

Waller acknowledged these competing perspectives and stressed that any potential rollout would depend on careful evaluation and consultation.

“The payments landscape, as well as the types of providers, has evolved dramatically in recent years, and accordingly, a new payments account could better reflect this new reality,” he said.

If implemented, the concept could represent a significant step toward broadening participation in the nation’s payment ecosystem while preserving the integrity of the Federal Reserve’s financial framework.

The initiative also aligns with the Fed’s broader efforts to foster innovation, including the development of FedNow — the new instant payment service launched to modernize real-time money transfers.

As the Federal Reserve continues its research, policymakers, regulators, and industry participants are expected to provide input on potential benefits and challenges.

The outcome could shape the future of how payment firms, both large and small, interact with the U.S. financial system — striking a balance between innovation, accessibility, and prudential oversight.