Private equity secondary market

secondary marketSecondary investmentsSecondariessecondaryPrivate Equity secondariessecondary investorssecondary private equityexit transactionliquidityprivate equity secondary
In finance, the private equity secondary market (also often called private equity secondaries or secondaries) refers to the buying and selling of pre-existing investor commitments to private equity and other alternative investment funds.wikipedia
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Lexington Partners

Leading secondary investment firms with current dedicated secondary capital in excess of circa $3 billion include: AlpInvest Partners, Ardian (formerly AXA Private Equity), Capital Dynamics, Coller Capital, HarbourVest Partners, Lexington Partners, Pantheon Ventures, Partners Group and Neuberger Berman.
Lexington Partners is the largest independent manager of secondary acquisition and co-Investment funds in the world, founded in 1994.

Coller Capital

Leading secondary investment firms with current dedicated secondary capital in excess of circa $3 billion include: AlpInvest Partners, Ardian (formerly AXA Private Equity), Capital Dynamics, Coller Capital, HarbourVest Partners, Lexington Partners, Pantheon Ventures, Partners Group and Neuberger Berman. Early pioneers in the secondary market include Jeremy Coller, the founder of UK-based Coller Capital, Arnaud Isnard, who worked with Carr at VCFA and would later form ARCIS, a secondary firm based in France as well as Stanley Alfeld, founder of Landmark Partners.
Coller Capital, founded in 1990 by Jeremy Coller, is one of the largest global investors in the private equity secondary market (also known as secondaries).

Dayton Carr

Venture Capital Fund of AmericaVCFA
The Venture Capital Fund of America (today VCFA Group), founded in 1982 by Dayton Carr, was likely the first investment firm to begin purchasing private equity interests in existing venture capital, leveraged buyout and mezzanine funds, as well as direct secondary interests in private companies.
Dayton Carr is the founder of Venture Capital Fund of America (today VCFA Group) a private equity firm that is credited with inventing the private equity secondary market.

Landmark Partners

Early pioneers in the secondary market include Jeremy Coller, the founder of UK-based Coller Capital, Arnaud Isnard, who worked with Carr at VCFA and would later form ARCIS, a secondary firm based in France as well as Stanley Alfeld, founder of Landmark Partners.
Landmark Partners, an SEC Registered Advisor, is one of the most experienced participants in the private equity secondary market for private equity (also known as secondaries) and real estate investments.

MidOcean Partners

DB CapitalDB Capital PartnersDeutsche Bank Capital Partners
The most notable example of this type of transaction is the spinout of MidOcean Partners from Deutsche Bank in 2003.
MidOcean was originally formed by the managers of DB Capital Partners to acquire Deutsche Bank's late stage private equity investments in the United States and Europe in one of the largest private equity secondary transactions completed to date.

Fund of funds

fund of hedge fundsfunds of fundsfund-of-funds
More and more primary investors, whether private equity funds-of-funds or other institutional investors, also allocate some of their primary program to secondaries.
According to Preqin (formerly known as Private Equity Intelligence), in 2006, funds investing in other private equity funds (i.e., FOFs, including secondary funds) amounted to 14% of all committed capital in the private equity market.

HarbourVest Partners

HarbourVestHarbourVEst Partners LLC
Leading secondary investment firms with current dedicated secondary capital in excess of circa $3 billion include: AlpInvest Partners, Ardian (formerly AXA Private Equity), Capital Dynamics, Coller Capital, HarbourVest Partners, Lexington Partners, Pantheon Ventures, Partners Group and Neuberger Berman.
HarbourVest has completed a number of significant secondary market investments in private equity:

Setter Capital Inc

According to Setter Capital Inc, there were a total of 1270 transactions in 2014, with an average size of approximately $37.7 million.
Setter Capital is a Canadian independent investment bank primarily focused on the private equity secondary market, providing fund acquisition, non-strategic asset disposal, investor liquidity management and optimization and market validation advisory services between some of the world’s largest institutional investors.

Collateralized fund obligation

— An investor contributes its fund interests into a new vehicle (a collateralized fund obligation vehicle) which in turn issues notes and generates partial liquidity for the seller.
Typically, owners of private equity assets will securitize a portfolio of funds as a way of generating liquidity without an outright secondary sale of the funds.

Pantheon Ventures

Pantheon Intl Participations
Leading secondary investment firms with current dedicated secondary capital in excess of circa $3 billion include: AlpInvest Partners, Ardian (formerly AXA Private Equity), Capital Dynamics, Coller Capital, HarbourVest Partners, Lexington Partners, Pantheon Ventures, Partners Group and Neuberger Berman.

Paul Capital

1991 * Paul Capital founded and acquires $85 million venture portfolio from Hillman Ventures
Paul Capital is a private equity investment firm made up of a fund of funds, secondary investments and a healthcare direct investment (royalty and revenue interest financing) business.

Auldbrass Partners

Auldbrass Partners is a Private Equity secondaries firm which was spun-out from Citigroup in 2011.

ABN AMRO

ABN-AMROABN AMRO BankABN AMRO Bank N.V.
Financial institutions, including Citigroup and ABN AMRO as well as affiliates of AIG and Macquarie were prominent sellers.
In 2008, RFS Holdings completed the sale of a portfolio of private equity interests in 32 European companies managed by AAC Capital Partners to a consortium comprising Goldman Sachs, AlpInvest Partners and the Canada Pension Plan for $1.5 billion through a private equity secondary market transaction.

Publicly traded private equity

listed investment trustprivate equity fund-of-funds investment trustpublicly traded private equity vehicles
With the crash in global markets from in the fall of 2008, more sellers entered the market including publicly traded private equity vehicles, endowments, foundations and pension funds.
KPE disclosed in May 2008 that it had completed approximately $300 million of secondary sales of selected limited

AlpInvest Partners

AlpInvestNIB Capital
Leading secondary investment firms with current dedicated secondary capital in excess of circa $3 billion include: AlpInvest Partners, Ardian (formerly AXA Private Equity), Capital Dynamics, Coller Capital, HarbourVest Partners, Lexington Partners, Pantheon Ventures, Partners Group and Neuberger Berman.
AlpInvest operates three investment teams focused on private equity: Fund Investments, Secondary investments and Co-Investments.

Ardian (company)

ArdianAXA Private Equity
Leading secondary investment firms with current dedicated secondary capital in excess of circa $3 billion include: AlpInvest Partners, Ardian (formerly AXA Private Equity), Capital Dynamics, Coller Capital, HarbourVest Partners, Lexington Partners, Pantheon Ventures, Partners Group and Neuberger Berman.
In 2010, during the increased activity in the private equity secondary market, Ardian acquired a US $1.9 billion private equity portfolio from Bank of America and a US $900 million portfolio from Natixis.

Leveraged buyout

leveraged buyoutsLBOleveraged finance
Pricing in the market fell steadily throughout 2008 as the supply of interests began to greatly outstrip demand and the outlook for leveraged buyout and other private equity investments worsened.
Secondary buyouts differ from secondaries or secondary market purchases which typically involve the acquisition of portfolios of private equity assets including limited partnership stakes and direct investments in corporate securities.

Private equity fund

private equity fundsprivate equitybuyout fund
As the European sovereign debt crisis hit the financial markets during summer 2011, the Private equity secondary market subsequently saw a decrease both in supply and demand for portfolios of interests in private equity funds, leading to reduced pricing levels compared to pre-summer 2011.
A sale of the portfolio company to another private equity firm, also known as a secondary, has become common feature of developed private equity markets.

Secondary market

aftermarketsecondary tradingmarket for resale
As the European sovereign debt crisis hit the financial markets during summer 2011, the Private equity secondary market subsequently saw a decrease both in supply and demand for portfolios of interests in private equity funds, leading to reduced pricing levels compared to pre-summer 2011.
Private equity secondary market refers to the buying and selling of pre-existing investor commitments to private equity funds.

Venture capital

venture capitalistventure capital firmventure capitalists
Alternatively, an exit may come about via the private equity secondary market.

Crossroads Group

1999* The Crossroads Group, which was subsequently acquired by Lehman Brothers, acquired a $340 million portfolio of direct investments in large- to mid-cap companies from Electronic Data Systems (EDS)
Crossroads was also an early investor in secondary interests in existing private equity partnerships.

Private equity

private-equityequityPrivate equity investor
In finance, the private equity secondary market (also often called private equity secondaries or secondaries) refers to the buying and selling of pre-existing investor commitments to private equity and other alternative investment funds.
Increasingly, secondaries are considered a distinct asset class with a cash flow profile that is not correlated with other private equity investments.

History of private equity and venture capital

History of venture capitalLBO boom
In 1982, Venture Capital Fund of America, the first private equity firm focused on acquiring secondary market interests in existing private equity funds was founded and then, two years later in 1984, First Reserve Corporation, the first private equity firm focused on the energy sector, was founded.

Alternative investment

alternative investmentsalternative assetalternatives
In finance, the private equity secondary market (also often called private equity secondaries or secondaries) refers to the buying and selling of pre-existing investor commitments to private equity and other alternative investment funds.

Asset classes

asset class
By its nature, the private equity asset class is illiquid, intended to be a long-term investment for buy-and-hold investors, including "pension funds, endowments and wealthy families selling off their private equity funds before the pools have sold off all their assets".