Morgan Stanley Jumps on Private Market Research Bandwagon

Morgan Stanley analysts were not about to be left out of Wall Street’s private market gold rush as companies with mind-boggling valuations like OpenAI and SpaceX put off public listings.

On Tuesday, the investment banking giant launched a landing page within its research portal dedicated exclusively to private companies, according to an internal memo sent out by the firm’s global director of research, Katy Huberty, and shared with The Daily Upside. The page will “spotlight the innovators and trends that are reshaping traditional business paradigms and serve as a central hub for clients to access all our private industry research in one place,” the memo said. 

Morgan Stanley has been publishing research on private markets since 2017, but it will now expand coverage to deliver deeper analysis and broaden its reach as client interest in unlisted firms grows. 

Unicorns Galore  

There are currently more than 1,500 active unicorns, privately held startups valued at more than $1 billion, that have raised roughly $1 trillion in venture capital funding, according to data compiled by PitchBook. So it’s no wonder that providing clients with insights into what these companies are up to is becoming a top priority. 

In addition to the page launch, two of Morgan Stanley’s analysts who previously focused on public companies have jumped over to digging in on private ones, Bloomberg reported. And at the end of last month, the company announced plans to acquire private shares platform EquityZen. 

Morgan Stanley is hardly the first investment research heavyweight to realize that investors are eager for a behind-the-scenes look at how private companies with soaring valuations are faring:  

• JPMorgan Chase expanded its research to cover private companies in July. Citigroup followed suit just days later.
• Just last week, Charles Schwab announced it was buying Forge Global Holdings, a private market platform and trading marketplace, for $660 million. 

Just the Beginning: “Both institutions and wealth management markets are looking for wide-scale research coverage of the alternative asset management industry and key industries such as private equity, private credit, real estate and energy infrastructure asset classes,” says Ken Leon, director of equity research at investment research firm CFRA. “There will be more firms to follow.”