A New Wave for UK Business: What the London Stock Exchange’s PISCES Approval Means for Growth and Your Future

Imagine a world where groundbreaking UK startups, poised for global impact, could access vital growth capital without the colossal costs and complexities of a full public listing. Imagine their early employees, holding valuable stock options, being able to unlock some of that hard-earned value without forcing a company sale or an IPO. This vision is now becoming a reality, thanks to a landmark move by the Financial Conduct Authority (FCA).

On August 26, 2025, the FCA announced a “major milestone,” granting the London Stock Exchange (LSE) approval to operate the UK’s first Private Intermittent Securities and Capital Exchange System (PISCES) platform. The LSE is calling its new venture the “Private Securities Market.” This isn’t just regulatory jargon; as Simon Walls, Executive Director of Markets at the FCA, noted, it’s set to “boost growth and unlock capital investment” in the UK economy. This groundbreaking system is designed to bridge the persistent funding gap for high-growth companies, offering a crucial “funding continuum” from private to public markets. [Infographic: Journey of a Growth Company]

A New Chapter for UK Growth Companies

For too long, successful private companies have faced a dilemma: how to fuel rapid expansion without sacrificing independence or navigating the demanding process of a full public listing. This often left early investors and dedicated employees with limited avenues to realize returns on their stakes, trapping capital and hindering further investment. PISCES steps in as a “private-plus” market, providing a structured yet flexible environment for these companies.

The LSE’s “Private Securities Market” will allow private firms to offer shares to a select group of investors during controlled, time-limited trading windows. This means an innovative clean energy startup or a burgeoning life sciences firm can raise significant capital and provide liquidity to its shareholders, including employees, without the constant scrutiny and compliance burden of a traditional stock market. Julia Hoggett, CEO of LSE plc, expressed her delight, emphasizing the new market’s role in creating “a genuine funding continuum” for businesses across all growth stages.

To be eligible for the LSE’s platform, companies must demonstrate either a fundraise of at least £10 million from experienced investors within the last three years, or total assets of at least £20 million. Investor access is primarily limited to professional, sophisticated, and high-net-worth investors, alongside the company’s own employees. This approach ensures that while capital flows, the market maintains a proportionate regulatory framework, balancing innovation with necessary oversight. [Diagram: PISCES Transaction Flow]

Strategic Alignment and Economic Benefits

PISCES isn’t just about company liquidity; it’s a strategic pillar of the UK government’s broader “Plan for Change” to enhance capital markets and boost economic growth. HM Treasury’s Economic Secretary, Emma Reynolds, highlighted this as “the latest significant milestone” in the government’s commitment to “enhancing our capital markets offering.” The new market is designed to attract cross-border capital, with industry analysts like AInvest calling it a “seismic shift” that can “attract cross-border capital” and benefit entities like UK pension funds seeking unlisted equity exposure.

Crucially, PISCES transactions will be exempt from stamp duty, reducing costs and simplifying deals for both investors and companies. Furthermore, employees selling shares obtained through tax-efficient schemes like EMI or CSOP can retain their tax advantages. This considered approach makes the UK an even more attractive destination for private capital and innovative businesses. The platform will operate within a Financial Market Infrastructure (FMI) sandbox until 2030, allowing the FCA to refine the permanent PISCES regime based on real-world activity. [Map: UK’s Position in Global Financial Innovation]

What to Watch Next: The Road Ahead

The LSE’s “Private Securities Market” is expected to launch later in 2025, promising to fundamentally reshape the UK’s capital markets – a development considered as significant as the introduction of AIM in 1995. This innovative framework is poised to provide a valuable stepping stone for high-growth companies, helping them mature before a potential public listing and build investor confidence.

Here’s what to watch as this new market takes shape:

• Initial Transactions: Keep an eye on the first companies to list and execute trades on the LSE’s platform, setting precedents for market activity.
• Competitive Landscape: The FCA anticipates “seeding a competitive market.” Will other firms apply to operate PISCES platforms, offering diverse options for companies and investors?
• Regulatory Evolution: The FMI sandbox period will provide crucial insights, guiding the refinement of the permanent PISCES regime and potentially influencing future regulatory approaches to financial innovation.
• Global Impact: Observe how PISCES strengthens the UK’s position as a global leader in private market innovation, attracting international investment and fostering growth in key sectors like AI, clean energy, and life sciences.

The ripple effects of this development are expected to be profoundly positive for the entire UK economy, nurturing the next generation of successful businesses and ensuring our financial markets remain at the cutting edge.

For more details, you can read the official announcement from the FCA regarding the first PISCES operator here: First PISCES operator gets greenlight in drive for growth | FCA.