Secondary transactions guide: PwC

A different time

Back in 2017, the private secondary market was just entering what would turn out to be an explosive multi-year period of growth. The market was becoming increasingly institutionalized, with dedicated funds and crossover investors executing bespoke deals aimed at helping founders and executives at high-growth, venture-backed companies gain partial liquidity. These were mainly the companies investors viewed as the most coveted unicorns—each privately valued above $1 billion—and demand to gain pre-IPO exposure was significant.

At the same time, company management teams were eager to rein in the ad hoc trading of employee shares that had begun to surface on private exchanges. While the secondary market was already measured in billions of dollars, few could have predicted the acceleration to come. The IPO market in 2017 was emerging from its worst year since the post-financial-crisis slump, and public equity performance was steady but unspectacular as the impact of Brexit loomed over the financial system. Yet as institutional investors searched for yield, private markets drew increasing attention and capital, setting the stage for a multiyear expansion in both private fundraising and secondary liquidity.

Present Day

Fast-forward to now, and the private secondary market has matured into a central pillar of the private capital ecosystem. What began as one-off liquidity events for founders has evolved into a highly structured and recurring component of private company finance. Following the 2021 peak in issuance and the subsequent pullback in IPOs during 2022 and 2023, the market has recalibrated. While inflation, rising rates, and geopolitical tensions briefly cooled public-market sentiment, the secondary market quietly strengthened. By 2024, structured secondary transaction activity accelerated significantly, with market data showing volumes nearly doubling year-over-year as companies increasingly turned to organized liquidity programs.¹ Median pricing rebounded to align with the most recent primary round—a sharp recovery from the discounts common in 2022²—and by mid-2025, median valuations across venture stages were up more than 40% compared to two years earlier, with late-stage valuations more than doubling.³

The market’s growth has also been fueled by the massive pool of unspent venture capital—now exceeding $311 billion⁴—and by many companies’ decision to remain private for longer, increasing to an average of 12 years from founding to IPO.⁵ As a result, employee and investor demand for interim liquidity has only intensified.

Today, recurring tender offers, controlled liquidity programs, and direct secondaries are increasingly viewed as a natural part of a company’s capital strategy. Institutional investors, crossover funds, and family offices now compete actively in these transactions, and purpose-built platforms have brought greater transparency, speed, and regulatory rigor to execution.

While IPO volumes remain subdued, the secondary market continues to provide liquidity and valuation signals to the broader private ecosystem. Many of the forces that drove the market’s initial rise—talent retention, capital recycling, and investor access to innovation—not only remain in place but have become more sophisticated and sustainable.