Paul Capital’s View on Secondaries Market

Article can be seen here.

There are probably 20 dedicated secondaries buyers on a global basis, but most of the capital is with around six of them. That has not changed very much and I think it will remain so. It seems like a business that should not have many barriers for entry, but there are huge barriers. If you want to put together a portfolio with some thought behind it, it takes a lot of work. We track the holdings of 24,000 institutional investors and you cannot build that kind of a database unless you have been in the business for a long time.

…

Around 70 per cent of our transactions are the acquisitions of LP fund interests and 30 per cent are other kinds of transactions.

…

Do you have an opinion on electronic exchanges for secondaries?

“They do not work. There is a huge amount of confidentiality involved in these transactions.

…

WSJ: Secondary VCs Going Strong

The following article (Not a Down Market for Secondary Venture Capital Funds) is evidence of a buoyant secondary VC market in the US.

Hans Swildens, a founder of Industry Ventures, says the secondary market is now “more active than I’ve ever seen it.” He estimates that 10% of invested capital in the venture-capital business is currently exploring a secondary sale, up from 3% to 4% in normal times