The private equity secondary market, sometimes referred to as private equity secondaries, is the market where the trading of private equity takes place. Traditionally, a small number of buyers has been the key player in this market, but this number is increasing. Private equity is an equity capital which is available to investors and firms but not listed in the stock market.
It refers to any kind of equity securities which are not owned by the public and not quoted on a stock exchange. Private equity is now treated as an asset of institutional class. Generally, the asset class of private equity is not liquid. It refers to long-term investment by equity investors. No public market is listed for the increasing demand of private equity investments, but the availability of a robust secondary market makes the trading of private equity investments easy.
The private equity secondary market also refers the investors’ commitment to private equity.
The sellers sell both their commitments to private equity and investments into the fund. Participants in the Private Equity Secondary Market: Big investment firms, such as HarbourVest Partners, Lexington Partners, AlpInvest Partners, Landmark Partners, and Coller Capital, entered this market some time ago.
Some small firms, such as Pomona Capital, Pantheon Ventures, Adams Street Partners, Paul Capital, and Newbury Partners have recently entered the market.
In addition to that, some big investment banking companies, including Lehman Brothers, Credit Suisse, Goldman Sachs, and Deutsche Bank have initiated their investment programs.
|Secondary Market||SBA Secondary Market|
|Private Equity Secondary Market||MBA’s National Secondary Market Conference|