Private Markets Go Public: Inside the SEC’s Push for Retail Participation

Expanding retail access to private markets and alternative investments is top of mind for the current administration and Congress. To this end, the Securities and Exchange Commission (SEC), under the leadership of Chairman Paul S. Atkins, has been exploring ways to facilitate the ability of individual investors to participate in the private markets. In furtherance of this policy shift and changing regulatory landscape, on March 4, 2026, the SEC’s Division of Investment Management (Division) hosted a Private Markets Roundtable to discuss the retailization of private markets, with a focus on governance, valuation, liquidity and investor protection considerations. 

SEC Chairman Atkins’ opening remarks, consistent with his statements in September of last year,[1] emphasized the SEC’s focus on the “‘responsible retailization’ of post-tax, pre-retirement dollars for investors” and noted that the SEC would embrace “growth and innovation across all asset classes while protecting investors through guardrails that guide proper investment into these private assets.”[2] Two panel discussions followed,[3] which included participants from asset management firms, the Big Four accounting firms, rating agencies and representatives from the Division. The following are key takeaways: 

1. Valuation - Practices and Governance 

   The valuation process in private markets differs from public markets because there is less price discovery in private markets. Fair value determinations in private markets rely heavily on model assumptions and require implementing robust controls to help ensure that assets are valued properly. Fund managers and advisors must gain a clear understanding of their valuation obligations, which may differ depending on the asset class. Panelists specifically referenced valuation guidance of Rule 2a-5 under the Investment Company Act of 1940 (1940 Act) and recommended, pursuant to the rule, that fund boards: (a) create clear valuation policies and procedures; (b) engage in monitoring to ensure valuation policies and procedures are properly implemented; (c) assess on a regular basis the appropriateness of valuation methodologies; (d) diligence and use pricing services in the valuation process; and (e) involve multiple stakeholders, such as auditors and consultants, in asset valuations. 

2. Clear Disclosure, Transparency and Education 

   As private markets become more accessible to retail investors, panelists highlighted the importance of transparent, fulsome disclosures that help retail investors better understand their investments. These issues, including liquidity concerns, are especially amplified in the context of semi-liquid private market products such as business development companies (BDCs), interval funds, and tender offer funds, which may offer limited redemption windows. 

3. Retail Pathways to Private Markets 

   Panelists gave an overview of the private markets landscape, including: 1940 Act products such as BDCs, interval funds and tender offer funds; non-1940 Act structures like REITs; private funds registered under the Securities Exchange Act of 1934; collective investment trusts (CITs); and illiquid sleeves in mutual funds. Panelists also emphasized the importance of understanding how various regulatory regimes apply to different financial instruments. Katten’s prior post, SEC’s Strategic Shift to Expand Retail Investors’ Access to Private Assets Provides New Opportunities: An Overview and Key Considerations, analyzes key features of many of these vehicles.

4. Emerging Trends 

   Panelists identified several potential trends, predicting that artificial intelligence and other technological advancements could revolutionize valuations by synthesizing data more rapidly and enabling more frequent valuations. Panelists also predicted that the expansion of private market access in the 401(k) space could also increase scrutiny into valuation practices, noting that CITs now represent over half of the retirement market. Potential changes to the accredited investor definition could also further broaden access to private markets, making enhanced disclosures even more important.[4] 

Katten advises product sponsors and other market participants on regulatory considerations related to private markets. Stay tuned as the regulatory landscape continues to change and as access to private markets expands. For more information, please contact one of the authors of this article or your primary Katten attorney.