Definition

Secondary Market (Private Equity)

A market where existing shareholders in private companies can sell their shares to buyers outside of a primary financing round, providing liquidity before a company's IPO or acquisition. Unlike primary markets (where a company sells new shares to investors in a funding round), secondary transactions involve existing shareholders - founders, employees, early investors - selling previously issued shares to new buyers. Greg Brogger built the first modern private secondary marketplace (SharesPost in 2009), which merged with Equate to create Forge. The private secondary market currently processes approximately $150 billion in annual volume against a $4 trillion private company asset base - roughly 3-4% annual turnover, compared to 100% for comparable public market indices. Major financial institutions are entering the space (Morgan Stanley acquired EquityZen in 2024), and 401k rule changes opening access to private equity are expected to significantly expand the market.

From the episode “Turn Illiquid Equity Into Real Wealth”

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