Space X, Secondaries and Pisces: Can the UK Catch Up on Employee Liquidity?

If you’re an employee at a successful private company in the US, say, SpaceX, and you’ve been granted equity, you might actually be able to do something radical with it: sell it.

Not on a public exchange. Not on a whim. But through a structured, secondary transaction where private shares are sold, often at eye-watering valuations, to institutional buyers, family offices, or high-net-worth individuals desperate for a piece of the next big thing.

That’s the American way: private capital, private buyers, private liquidity. And it works. Not perfectly. But better than in the UK, where even discussing early liquidity for employee equity still feels faintly subversive.

So now we have Pisces, the UK’s emerging response to this quiet capital market revolution. But is it too little, too late? Or exactly what we need?

How SpaceX Employees Get Liquidity Without an IPO

SpaceX is still private. It may remain private indefinitely. Yet over the years, Elon Musk and the SpaceX board have enabled multiple structured secondary offerings, including tender offers and internal liquidity windows, where employees and early investors can sell a portion of their shares.

The company typically sets the rules:

• Who can sell (usually senior staff or long-tenured employees),
• How much (e.g. up to 10% of vested holdings),
• At what price (based on institutional investor appetite),
• And to whom (pre-vetted buyers, often existing shareholders).

The outcome? Employees are rewarded without needing an exit, and the company retains tight control of its cap table. Liquidity becomes a feature, not a threat.

Why Does This Work in the US?

Several structural reasons:

• Company law: Delaware is flexible. Shareholder agreements are custom-built. Consent and transfer rules can be tailored to liquidity events.
• Tax treatment: No equivalent of the UK’s complex employment tax rules. US equity comp is taxed under simpler (if still painful) capital gain vs income frameworks.
• Private market culture: There’s a well-established infrastructure of secondary platforms, broker-dealers, and legal counsel who understand how to manage these deals efficiently.
• Investor mindset: Institutional investors actively seek exposure to late-stage private companies and are happy to do it through employee shares.

Put simply: there’s a market, there’s demand, and there’s a framework that supports it.

So Why Is the UK Lagging Behind?

Three words: legal, tax, and culture.

• Legal: Many UK company articles and shareholder agreements explicitly restrict any share transfer, especially from employees. Even an offer to sell can trigger a raft of approvals, consents and rights of first refusal. And we still haven't got to the fun part of navigating UK company law, the prospectus regulations and financial promotion. 
• Tax: HMRC treats most share-based gains as income unless tightly structured and even then, early liquidity has the potential to jeopardise the tax treatment of employee equity under ITEPA (although HMRC has recently produced some helpful guidance on how trading shares on Pisces interacts with tax-advantaged share plans like EMI and CSOP).
• Culture: UK companies often view secondaries as messy or “disloyal.” Even talking about selling shares pre-exit can be perceived as bad form, especially in founder-led or PE-backed environments.

The result? No market. No mechanism. No momentum.

Enter Pisces: The UK’s Private Intermittent Securities Capital Exchange System

Pisces is being positioned as a response to all of the above, an initiative to create a regulated, compliant, semi-liquid market for private securities. Think of it as the infrastructure for structured, intermittent secondaries in the UK, including growth-stage companies with valuable but illiquid equity on their books.

What might it enable?

• Company-approved internal liquidity events for employees,
• Pre-approved buyer pools (institutional or sophisticated),
• Structured transaction windows (e.g. once or twice a year),
• Seamless settlement and reporting, backed by Euroclear.

It’s not a crypto play. It’s not decentralised finance. It’s a governed, intermittent capital exchange designed to unlock value within guardrails.

Is Pisces Modelled on the US Experience?

Yes and no.

• It’s inspired by the flexibility and success of US secondaries, especially in firms like SpaceX, Stripe and Palantir.
• But it’s very much tailored to the UK regulatory, legal and tax environment.
• Unlike US platforms that match buyers and sellers directly, Pisces attempts to prioritise company control, standardised documentation, and institutional-grade oversight.

Think: Nasdaq Private Market meets HMRC-friendly compliance playbook.

Final Thought

The idea behind Pisces is not to blow up the system. It’s to build a better one, one that gives UK employees a real chance of participating in value creation, without breaking tax law or triggering shareholder chaos.

For years, we've told employees to “think like owners.” Maybe it’s time we let them act like owners too, even before the exit.

Need help designing a share plan or secondary structure that could one day plug into Pisces? Or navigating the legal and tax maze around early employee liquidity? That’s what we do at Burges Salmon. Let’s talk.