A hand takes a larger slice of the cake

Private Equity Secondaries Special

A thriving market in an era of low liquidity

In an environment where private equity fundraising is languishing, secondaries is proving increasingly attractive to traditional PE managers. In this special report, we look at the trends shaping the secondaries market in 2025, including the wave of private equity shops launching their own secondaries platforms; the potential for growth in real estate secondaries; the industry’s busiest law firms and advisories; and the pitfalls associated with venture capital secondaries.

We also list the biggest secondaries fundraisers of the past five years in the 2025 edition of the Secondaries Investor 50 ranking, and name the industry’s brightest young talent in the form of the Next Gen 10.

COVER STORY

Toy building blocks in the shape of a dollar sign and euro sign

How to build a secondaries business

Over the past five years, some private equity shops have shunned their illiquid mentality to launch their own secondaries businesses. Can they give the market’s mega-managers a run for their money?

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PREVIOUS COVERAGE

Reinventing continuation funds

Whenever a market swells, it is inevitable that some growing pains will appear. For the secondaries market, which is on track for a record-breaking year, those issues are related to continuation funds. According to Evercore’s H1 2024 Secondary Market Review, such funds accounted for 43 percent of the $72 billion of deal volume seen in the first half – and yet, not all market participants are satisfied with how they operate. In our 2024 secondaries special, we speak to a host of investors to find out how they think continuation funds could be improved upon, as well as the other changes they would like to see in a growing secondaries market.

Also in this report, we reveal the results of the Secondaries Investor 50 ranking of the largest secondaries fundraisers, uncover the latest young secondaries talent to make this year’s Next Gen 10 list, and delve into how secondaries funds perform compared with their buyouts counterparts.

The future of LP secondaries

The disruptive power of artificial intelligence is a topic on everybody’s minds. In our 2023 secondaries special, we look at how the generative technology can be used to drive change in the secondaries market – particularly through the streamlining and standardising of trading processes. Experts who Private Equity International spoke to for this report suggest that significant changes to the way the market operates could be on the horizon. “This is the first time in 10 years I’ve seen this level of innovation,” said one managing director. A partner added: “An increasing pace of adoption is what’s happening right now.”

We also disclose the results of the Secondaries Investor 50, our annual ranking of the top 50 biggest secondaries fundraisers, and reveal the winners of this year’s Next Gen 10 list of the most impressive young talent in the secondaries market.

Could AI be the future of LP secondaries?

Generative artificial intelligence is being applied to private markets at breakneck speed. The biggest hurdle to applying these software tools to LP secondaries trades is the market’s lack of standardisation.

The Secondaries Investor 50 – fundraisers belie difficult 2023

Our ranking of the biggest secondaries fundraisers reveals a market reaching an inflection point.

Next Gen Leaders of Secondaries: Class of 2023

Now in its eighth iteration, we reveal this year's most impressive secondaries individuals under 36.

Secondaries H1 reports show a dip in activity

A slow start to the year has led some market participants to lower their end-of-year estimates.

Five key trends moving the secondaries market

Growth in the industry is being driven by greater acceptance and increasingly diverse liquidity options.

The rise of NAV lending

Structured solutions can provide much-needed liquidity without forcing LPs to crystalise a loss.

At the top of the secondaries class

Which SI 50 secondaries funds are the strongest outperformers?

All roads lead to infrastructure secondaries

A confluence of factors is driving interest in infrastructure secondaries.

To sell, or not to to sell? That is the LP’s question

LPs are facing a difficult choice as they balance liquidity challenges with the deep discounts on offer in the secondaries market.

Finding alignment in secondaries

Alignment is a critical issue for LPs, GPs and secondaries buyers alike in today’s shaky fundraising environment. In our 2022 secondaries special, we look at how market participants can ensure their business isn’t slowed down by complex agendas or operational gridlock.

Further, we recognise the 50 biggest capital raisers of the past five years in the SI 50 ranking, and also celebrate the brightest young talents in the secondaries market with our Next Gen 10 leaders list.

Setting things straight: Just how aligned is the secondaries market?

As an increasing number of sponsors turn to secondaries processes, doubts are being raised about the market’s building blocks. Just how aligned is the secondaries market today?

Secondaries alignment: Finding equilibrium through terms

Some sponsors are still able to drive aggressive terms in GP-led deals, though perhaps not for much longer.

Secondaries alignment: Sort out your own house

For the GP, internal alignment is another opportunity to manage team dynamics. Third parties will want to see that the right people participate in the economics.

Secondaries alignment: Finding a balance

Conflicts of interest can arise within the LP base as LPACs act in their own interest, not in the interest of the fund.

Secondaries alignment: Name your price

Finding the pricing sweet spot to satisfy sponsors, buyers and LPs is tougher than ever in today’s market.

Secondaries alignment: Engaging the portfolio company

An incentivised management team is crucial to ensuring ultimate success in GP-led secondaries deals.

Secondaries alignment: Working within the rules

When dealing with waterfalls, there are tools that can be used to create economic alignment from the outset.

The Secondaries Investor 50 – fundraisers belie difficult 2023

Our ranking of the biggest secondaries fundraisers reveals a market reaching an inflection point.

Next Gen Leaders of Secondaries: Class of 2023

Now in its eighth iteration, we reveal this year's most impressive secondaries individuals under 36.

Secondaries H1 reports show a dip in activity

A slow start to the year has led some market participants to lower their end-of-year estimates.

Five key trends moving the secondaries market

Growth in the industry is being driven by greater acceptance and increasingly diverse liquidity options.

The rise of NAV lending

Structured solutions can provide much-needed liquidity without forcing LPs to crystalise a loss.

At the top of the secondaries class

Which SI 50 secondaries funds are the strongest outperformers?

All roads lead to infrastructure secondaries

A confluence of factors is driving interest in infrastructure secondaries.

To sell, or not to to sell? That is the LP’s question

LPs are facing a difficult choice as they balance liquidity challenges with the deep discounts on offer in the secondaries market.

Special report: Risk in secondaries

Secondaries is a segment of private markets that has evolved more quickly than any other in recent years.

Investor appetite for both secondaries funds and engaging in the secondaries market continues to grow. But beneath the surface lie hidden risks that investors need to be aware of – as we identify in our special report. We also run down the young people driving that evolution and where the capital in the sector is going.

The SI 30 visualised

See the largest secondaries fundraisers since 2014 and how much they have raised.

20 young people making waves in secondaries

Young Guns of Secondaries Class of 2019: a look at the industry’s leading professionals under 36 as part of our September secondaries special.

Secondaries: Avoiding the hidden risks

The strategy has evolved from focusing on diversification and J-curve mitigation to one making concentrated bets on often highly complex deals. Investors unaware of the potential risks face hidden dangers.

When secondaries go wrong: What the lawyers think

When net asset values drop and LPs who rolled their interests into their GP’s vehicle start to think they should have sold their interests instead, there could be legal implications.

Secondaries pricing: Behind the NAV

Buyers and sellers' expectations need to stay within touching distance of each other for a successful market.

Risk avoidance and allocation in secondaries transactions

Ropes & Gray’s Raj Marphatia and Jianing Zhang explain how a secondaries transaction on an Indian-focused fund nearly fell apart.

What do LPs really think of continuation funds?

Investors including Alaska Permanent, Caisse des Dépôts, Skandia, New York City Retirement Systems and TRS Texas share their views on how this market can be improved and how they are positioning themselves to take advantage of CVs.

The Secondaries Investor 50: 2024

Secondaries fundraisers find success through specialisation.

Next Gen Leaders of Secondaries: Class of 2024

Now in its ninth iteration, we reveal this year's most impressive secondaries individuals under 36.

Approaching secondaries’ finest hour

Helping to close the liquidity gap will create a boom for both the secondaries and primary markets.

The appeal of securitisations

Florida State Board of Administration believes securitisations could be a better option than selling fund stakes if LPs must take massive discounts.

The decade of capitalisation

Following an ‘era of innovation’, the secondaries market is ushering in a new age of growth.

VC sees interest from the buyside

A recent study shows an increase in buyside firms looking at venture capital secondaries.

Half time: How is the secondaries market faring?

According to mid-year advisory reports, the market is looking at a potentially record-breaking finish to 2024.

Secondaries’ first-half slip

While H1 2024 did not see a large-scale fund close, several vehicles with hefty targets remain in market.

How do secondaries funds perform?

Secondaries funds can deliver outperformance compared with PE buyout funds due to their diversification and asset-screening processes.

Secondaries industry improves reporting to win over LPs

The secondaries industry is stepping up its reporting of the performance of continuation fund exits as the supply of opportunities continues to outstrip available capital.

Venture secondaries steps into the spotlight

VC secondaries players have raised billions in fresh capital as the market’s liquidity needs show no signs of easing.

Private credit secondaries soars

Average bids for second-hand stakes in private debt funds rose to their highest point since at least 2017 in H1 2024.

Deals boom for secondaries law firms

The market’s largest legal advisers worked on more than $800bn of transactions last year, marking their second busiest annual period.

Co-advisory mandates arrive

The advisory space has seen a rise in the number of intermediaries working with another adviser on transactions.

How to enter China’s secondaries market

China’s booming LP-led market is offset by a nascent GP-led market and challenges unique to international investors.

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