Why Secondary Markets Are Eating the IPO | All-In Liquidity Secondary Markets Panel
Summary
Private-company secondaries have become a third exit market: 2025 volume is roughly double the 2021 peak, activity equals 31% of primary venture activity, and pricing swung from $0.80 on the dollar to $1.06. Brad Gerstner calls later-stage names “quasi-public companies,” with secondaries now competing against IPOs and acquisitions for distributions. The organized market nevertheless sits beside “wild west” SPVs charging 10% loads and double carry.
Employee liquidity is economically necessary when companies remain private for seven, 15 or even 24 years, but the panel sees that longer private life as a governance trade-off. Paper wealth of $10m or $30m does not buy a house, while founders may prefer avoiding the public-market microscope. Chamath Palihapitiya described private investors as often telling management what it wants to hear to preserve access, making a successful CEO “the most special flower.” His Facebook example supplied the cost: in 2010 he sought $1bn to build a phone, Zuckerberg backed Bret Taylor’s HTML5 strategy, Facebook went public a year later, and Chamath said “that year made all the difference.” Zuckerberg later said public-market pressure might have changed the decision.
Forge’s deal with Schwab is a wager that regulated infrastructure can turn private-company equity into a genuine retail asset class, combining Forge’s roughly 3m investors with Schwab’s 46m investors and $12tn. Kelly Rodriques said Forge’s 2018–19 SpaceX SPVs were permissioned and that Elon publicly discussed broad IPO distribution at the IPO price. Direct shares and SPVs still require accreditation, but products coming to market as interval funds could hold 60 companies including SpaceX and accept unaccredited investors at $500 minimums: “This is a real asset class.”
Democratization does not make entry price irrelevant: after two of the public market’s biggest months in a decade, Brad said he might put $30k of a fresh $100k to work today. He warned retail against double-fee SPVs, leverage and expecting a late SpaceX purchase to triple immediately; he cited 14 levered ETFs launching for its IPO day around a $1.75tn valuation as another sentiment signal. The goal is “durable democratization,” and “we may not be at the top, but we ain’t at the bottom.”
The new sell button is changing venture behavior as much as access: Brad is selling portions at four or five times cost for DPI, while Jason Calacanis now sells alongside founders once companies reach about $500m. Founders rarely welcome it, but Brad called partial sales a fiduciary duty. Gavin Baker sees the other side too: firms lacking exposure to trillion-dollar winners are protecting their franchises by writing speculative “call options” and “chasing” stories.
The panel rejected a 1999-style collapse analogy because Anthropic, OpenAI and SpaceX are real businesses, but it considered 2021-like valuation compression entirely plausible. Unlike CMGI—no revenue, a move from $2 to $2,000, a purchase of Foxboro Stadium, then failure—today’s leaders have substantial operations; that does not preclude a 10–20% semiconductor-index correction and 30–40% drawdowns in high-beta names. Technology remains a “jagged line up and to the right,” provided investors have staying power.
Below the marquee names, the panel’s ideas concentrated on agent software, modern financial infrastructure, AI networking, robotics and autonomous delivery. Picks included Sierra and Parloa, Revolut, Arrcus and DriveNets, Neura Robotics, Vast and Zipline; the recurring thesis was rebuilding legacy stacks or supplying the specialized infrastructure around AI. Gavin’s networking formulation was “the right chip for the right job at the right time,” while Jason called drone delivery “Uber 2.0.”
Deep dive
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