State of secondaries

We’ve spoken to a bunch of individuals looking for liquidity lately. Almost everyone will ask me for my take on the secondary markets. Here it is:

There are buyers out there right now, but they are largely opportunistic and taking advantage of people desperate for liquidity. And there are a lot of people desperate for liquidity. Despite looking for liquidity, a lot of sellers have held firm and have decided to wait for the market to rebound.

A lot of people are expecting things to get better in the next year. And they will. But what they’re also not realizing is that multiples will not come close to where they once were. Coming that with slowing revenue growth in startup world, and it may take years for companies to get back to previous valuations.

I don’t expect sellers to wait much longer. I expect volume to pick up significantly in the second half of the year as people round out year 2 of the bear market.