Morgan Stanley Acquires EquityZen

Core Insights - Morgan Stanley has agreed to acquire EquityZen, a trading platform for shares in private companies, to enhance its offerings for startups and private firms [1][2] Group 1: Acquisition Details - The acquisition of EquityZen will facilitate easier investments in private firms for Morgan Stanley's wealth management clients and allow them to offload shares from equity compensation [2] - The deal is expected to close early next year, but the financial terms have not been disclosed [2] - Morgan Stanley anticipates incurring approximately $100 million in integration costs related to the acquisition over the next two years [9] Group 2: Strategic Importance - The acquisition is part of Morgan Stanley's strategy to attract closely held companies and their executives, as many startups are choosing to remain private longer [3] - The partnership with EquityZen aims to provide an institutional-grade infrastructure to a marketplace that has been challenging for buyers, sellers, and issuers [3] - Morgan Stanley's CEO Ted Pick has been cautious about acquisitions until now, making this deal significant as it marks his first acquisition [4][6] Group 3: Market Context - The demand for access to private companies is growing, exemplified by the valuation of OpenAI at $500 billion, which surpasses most companies in the S&P 500 [3] - Morgan Stanley has previously established a special designation for advisers managing the wealth of private company stakeholders and has partnered with Carta Inc. for equity management [5] - Competitors like Goldman Sachs and JPMorgan Chase are also expanding their presence in the private market space through acquisitions and strategic moves [6] Group 4: EquityZen Overview - EquityZen, founded in 2013, has facilitated transactions for over 450 companies and has more than 800,000 registered users [8] - The company emphasizes "company-approved" transactions, which Morgan Stanley plans to incorporate into its offerings [8][10]