Within the secondary market, there are numerous opportunities to purchase and sell shares within the private securities sector. There are select time sensitive opportunities where buyers and sellers are granted a narrow window where they can execute deals related to specific later stage opportunities in the private markets as elaborated on below.
Read MoreMar 4, 2024
Deel acquired career development platform for $20 million.
Figure AI raised $675 million at a $2.6 billion valuation.
Reddit filed its S1.
Stripe performed a tender offer at $65 billion valuation.
Thrasio filed for bankruptcy
Given the vast set of opportunities to buy or sell securities within the secondary market, there are a myriad of participants that are present on both the buy side and the sell side.
Buy Side participants are listed below. They seek exposure to late stage growth investments.
Institutional growth stage VC firms / hedge funds - VC firms with a mandate to invest in late stage growth name via primary rounds. Given the size of these later stage round (Series C+), they tend to have $100M+ AUM. They participate in the secondary market by doubling down on their current portfolio company at discounts to lower their cost basis.
Read MoreFeb 19, 2024
Bolt was performing a tender offer at a $300 million valuation for its preferred shareholders which represents a 97% markdown in valuation.
Cohesity acquired Veritas’ data protection business in a deal that would value the combined business unit at $7 billion.
Epic Games received a $1.5 billion investment from Disney.
Feb 05, 2024
Databricks acquired Einblick, a natural language processing startup.
ID.me achieved 50 million users.
Wiz surpassed $350 million in ARR.
Upon the onset of 2024, the secondary market has evolved as outlined below.
1) There are select momentum driven companies (SpaceX, OpenAI, Anduril, Redwood Materials, Hugging Face, Cohere, etc) in the Generative AI and aerospace and defense industries where access to investment opportunities is paramount and there is less emphasis on fundamental analysis. Investor demand significantly outshines available supply. Given that secondary deals are largely blocked in these names and liquidity is limited, investors and sellers can transact via a SPV (Special Purpose Vehicle).