As general partners (GPs) and limited partners (LPs) increasingly prioritize liquidity in a market characterized by a lack of distributions, what key trends are driving the rise in secondary market transaction activity?

ÃÛ¶¹ÊÓƵ surveyed secondary investors and analyzed transaction data to delve deeper into these trends.

Annual secondary market transaction volumeÌý

Note: Darker shades denote ÃÛ¶¹ÊÓƵ 2025 projections

2024 was a record year for the secondary market, with $156B of closed transaction volume surpassing the market’s previous high in 2021, and representing a 35% YoY increase over 2023 volume.

ÃÛ¶¹ÊÓƵ Private Funds Group (PFG) is predicting another record year for the secondary market in 2025, anticipating ~$180B of transaction volume for the year with an even split between LP and GP-led volume.

Key takeaways

GP-led momentum

Strong ongoing GP-led momentum

  • The widespread adoption of GP-led solutions as an attractive liquidity option resulted in this segment of the market achieving $70B of transaction volume, representing nearly 10% of the total exit value for sponsor-backed companies globally
  • Single and multi-asset continuation funds were the most commonly used structures and collectively accounted for over 85% of GP-led volumeÌý

Ìý

LP-led volume

Significant LP-led volume tradedÌý

  • LP-led transaction volume reached $86B as bid/ask spreads continued to tighten driven by strong investor appetite, record levels of secondary dry powder and a continued scarcity in distribution activityÌý
  • Buyout funds continue to be the most traded fund type making up over 80% of transaction volume with single digit discounts becoming increasingly more common

Pricing improvements

Notable pricing improvements

  • Pricing for GP-led transactions continued to improve across the board with the vast majority of deals pricing at 90%+ of NAV. A record number of deals completed at a premium, particularly in situations involvingÌýresilient buyout assets managed by reputable sponsors

Investors

Expanding investor universe

  • The secondary investor universe continued to broaden significantly throughout 2024 in what has historically been an undercapitalized market
  • Traditional secondary firms continue to launch adjacent strategies, new entrants are emerging, and retail capital is being accessed at scale

VC focus

Increased VC and growth GP-led transactions

  • 2024 marked a banner year for GP-led transactions in the VC and growth space with several prominent managers completing sizable, high-profile transactions
  • These transactions have returned a significant amount of capital to investors, despite a particularly challenging traditional exit backdrop for VC and growth companies

Methodology: Reference to market analysis refers to a survey that ÃÛ¶¹ÊÓƵ conducted to solicit feedback on secondary market activity in FY 2024 as well as market intelligence that ÃÛ¶¹ÊÓƵ has gathered from conversations with secondary investors, publicly available information and transaction activity that ÃÛ¶¹ÊÓƵ was involved with in FY 2024. Certain statistics shown reflect ÃÛ¶¹ÊÓƵ’s estimates based on data gathered from ÃÛ¶¹ÊÓƵ survey respondents and publicly available information.

Private Funds Group

A global private capital advisor integrating world-class private placement expertise with aÌýtop-tier secondary advisory platform, raising over $87 billion of new money since 2010

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