The Private Stock Market Boom: Why Secondaries Are Becoming a Primary Exit Route

Private share secondary markets reached $226 billion in transaction volume in 2025, up 41% year-over-year according to Evercore Private Capital Advisory's 2025 Secondary Market Report. That volume has made secondaries one of the main liquidity channels for investors in mature private companies, alongside traditional IPOs. In the All-In Podcast episode “Inside the Private Stock Market Boom” - featuring Brad Gerstner of Altimeter Capital, Gavin Baker of Atreides Management, and Kelly Rodriques of Forge Global - the panel explored how secondary markets have evolved into a practical exit mechanism as companies stay private for longer periods.

Record Volume, Constrained IPO Market

LP-led sales and GP-led continuation vehicles both contributed to the 2025 increase. Alongside this, IPO activity recovered modestly in the same period but remains well below the scale required to clear the volume of private capital now in the system. High-quality growth companies continue to delay or skip public listings, which leaves sellers looking for earlier liquidity and buyers seeking businesses with proven performance at later stages.

What the Panel Discussed

The All-In panel treated secondaries as direct competitors to IPOs rather than a stopgap. Many late-stage companies prefer to avoid the reporting demands, activist pressure, and market volatility that come with public status. Private capital remains available, and founders continue to favour control. More than half of value creation in leading technology companies now takes place before any IPO, changing the role of secondary markets from occasional liquidity valve to a more regular part of the exit landscape.

The conversation covered the Forge-Schwab transaction (with Forge Global being acquired by Charles Schwab for $300 million in March of 2026, bringing private market transaction infrastructure into a brokerage network with 38 million active accounts) and the role of SPVs, interval funds, and managed baskets in widening access while allowing companies to stay private on their own timeline.

How Secondaries Work in Practice

Venture and growth funds historically waited for IPOs or trade sales to return capital, with longer private holding periods creating liquidity pressure on both sides (investors who needed distributions and employees sitting on paper wealth). Secondaries have filled that gap.

GP-led continuation funds let managers hold strong assets while providing liquidity to existing investors who want out, and employee tender offers give companies a way to offer partial realisations to staff without triggering a full exit. Buyers gain both entry to later-stage companies with revenue, and clearer paths to eventual liquidity.

SpaceX, Anthropic, OpenAI, and Databricks appear among the most actively traded names in secondary markets. Actual bid-ask levels in these markets provide pricing data that fund marks often lack, which has become one of the more useful byproducts of secondary market growth.

For a detailed look at LP-led and GP-led mechanics, our earlier article on private market secondaries covers the full picture.

Secondary Prices as a Signal

Private companies don't file quarterly accounts or hold earnings calls, which means investors typically rely on GP Net Asset Value (NAV) marks that can lag actual market conditions by months. Active secondary trading in the same names produces something closer to a real-time read.

When Forge or a comparable platform shows a live bid of $260 and an ask of $290 on Anthropic shares, that spread reflects what informed buyers and sellers are willing to transact at today, incorporating recent funding rounds, competitive developments, and broader market sentiment rather than a GP's last valuation event. For investors already holding pre-IPO positions, these prices are a more current reference point than a fund statement. For those evaluating a new position, they set a market context for what entry looks like relative to where secondary participants are pricing the same asset.

The signal has limits worth understanding:

• A wide bid-ask spread in a thinly traded private stock often reflects information asymmetry between parties rather than a genuine range of views on value.
• Thin volume can produce prices that wouldn't clear at scale.
• NAV marks used to set secondary prices may themselves lag actual market conditions, particularly in GP-led vehicles where valuations are infrequent.

As secondary volumes grow and more institutional participants transact in the same names, the data becomes more reliable. Nasdaq Private Market's move to make its valuation data publicly available as part of its Polymarket partnership is a step in that direction.

Valuation Discipline

GP-led continuation vehicles, which now account for close to half of total secondary volume according to Jefferies' H1 2025 secondary market data, are increasingly priced at or near NAV. The discount that historically compensated buyers for illiquidity and limited information has compressed materially. Buyout secondaries averaged 94 cents on the dollar in H1 of 2025, per CAIS's analysis, up from prior years. Buyers are now paying close to full value for assets where the exit timeline remains uncertain.

The podcast panel’s view was that company quality still determines outcomes regardless of structure. A continuation vehicle holding a strong business at a modest premium is a different transaction from one holding a weaker asset priced at NAV through a GP-managed process. As volumes grow and more capital chases fewer quality names, the due diligence required to tell those apart becomes more demanding, not less. The team was quoted as saying:

"A continuation vehicle holding a strong business at a modest premium is a different transaction from one holding a weaker asset priced at NAV through a GP-managed process."

Carry terms, preferred hurdles, catch-up arrangements, and the choice between whole-of-fund and deal-by-deal waterfall structures continue to shape final investor returns once an exit occurs. These mechanics matter as much as entry price when assessing any secondary transaction.

What This Means for Wholesale Investors

For wholesale investors considering private market exposure, secondaries add a dimension that primary fund investing doesn't offer: the ability to buy into assets that already exist, at prices set by recent market transactions rather than a GP's initial fundraise.

The practical questions to work through before committing capital:

1. What is the entry price relative to current secondary market levels for the same asset?
2. What does the vehicle actually hold: direct equity, or derivative and fund-of-fund exposure?
3. What are the exit mechanics and realistic timelines to a liquidity event?
4. What fees are taken before distributions reach investors, including carry, hurdles, and management fees?
5. What happens if the company doesn't reach a liquidity event within the expected window?

Positions in secondary vehicles remain illiquid. Valuation opacity is if anything more acute than in primary investing, because you are buying at a price derived from a NAV mark that may not reflect current conditions. Concentration risk applies where a vehicle holds one or a small number of names. Our piece on the risks of private market investing covers the structural risks in detail.

Regulated SPV structures allow eligible wholesale and sophisticated investors to hold direct equity at the price negotiated for that specific deal, without the premiums often seen in listed vehicles or the additional layers that come with derivatives. Outcomes still depend on the underlying company and the terms of each vehicle.

NonPublic Pty Ltd (ABN 49 607 216 928) holds Australian Financial Services Licence #482668. Investments are available to wholesale and sophisticated investors as defined under the Corporations Act 2001. This content is general in nature and does not constitute financial product advice. It does not take into account your objectives, financial situation, or needs. Investing in private markets involves significant risk, including the potential loss of your entire investment. Past performance is not a reliable indicator of future results. You should obtain independent financial advice before making any investment decision.