Understanding the Secondary Market in Venture
About this event
Over the last 12 months, there's been a lot of chatter around secondary transactions.
For those new to this industry, let's quickly explain what secondaries are.
Unlike new equity raised by a company (think Series A, B, C...), secondaries are when investors purchase equity from an existing stakeholder (early investor, founder, company employee). There is no centralized marketplace for this, so transactions occur privately between a buyer and seller with approval by the company.
Here's the thing. With so many venture-backed companies hitting billion-dollar+ valuations, the late-stage private market has ballooned into a $4 trillion asset class.
It's an opportunity for investors to buy equity in companies before they go public. And in the current market environment, many are transacting huge discounts to their last round valuations. But navigating secondary markets can be challenging...
Here's what we'll cover:
What secondaries are – a brief explainer and evolution of a new $4T+ asset class and market dynamics
Why this is interesting today – how to think about secondaries vs. traditional growth equity/late-stage venture capital, public equities, and credit markets.
How deals get done – an overview of the market players (buyers, sellers, and intermediaries) and how to source and close a secondary transaction.
Opportunities – real-world examples of how inefficiencies can create investment opportunities in the secondary market.
Key Risks – synthetic structures, ROFRs, blocked transactions, understanding cap tables, access to information, and more fun challenges to navigate.
The Experts
Jamie Melzer is the Managing Partner and GP of HF Scale Partners, the growth and late-stage opportunistic investment platform affiliated with early-stage venture capital firm Hustle Fund. HF Scale invests in Series B through Pre-IPO venture-backed companies through both primary rounds and secondary transactions through co-investment vehicles, and now its Opportunity Fund. Since launching almost two years ago, Scale has invested >$20M into names like AngelList, Epic Games, Ellevest, and others.
Jamie has over 17 years of experience investing across asset classes, including high-yield and distressed debt, public equities, and venture capital. Before joining Hustle Fund, Jamie was at Brigade Capital, where she deployed ~$2B across their hedge fund and opportunistic strategies. Before Brigade, Jamie was an II ranked high yield research analyst at Bank of America.
Eric Bahn is a co-founder and General Partner at Hustle Fund VC, a pre-seed fund for software entrepreneurs. Previously, Eric was a partner at 500 Startups and a Product Manager at Instagram. In a prior life, Eric founded an education company called Beat the GMAT (acq 2012).
Andrea Lamari is a General Partner at Manhattan Venture Partners (“MVP”), a venture fund with a refined focus on secondary direct investments in growth and pre-IPO companies, such as Klarna, SpaceX, Epic Games, and Flexport.
As one of the first female executives in the space, Lamari has been shaping the landscape of the private company liquidity environment since its early days, beginning her career as a co-founder of Forge Global (NYSE: FRGE), one of the largest secondary marketplaces and the first to go public. And prior to joining MVP, she led the Liquidity Solutions (CartaX) team at Carta and spent three years as an executive at the Nasdaq Private Market.
Working directly with more than 100 late-stage private companies, Lamari has overseen and facilitated over $10 billion worth of secondary transactions for mid and late-stage private companies and has been recognized in Venture Capital Journal’s ranking of the 40 Rising Stars under 40 in the global venture capital community.
