”The capital raised leading up to 2021, coupled with slowing exits in recent years, has created a real need for liquidity in the marketplace. Secondary managers have provided much-needed liquidity at discounts to the underlying valuations. Taylor was careful to point out that he’s not buying an asset based solely on their discount. “The discount is really a reflection of what we think the go-forward and terminal value is for the assets we’re purchasing and the return we want to earn to take on that exposure. We discussed the historical dispersion of returns between public and private market investments. The dispersion of returns between the top and bottom quartile large- and mid-cap funds is roughly 5%; while the dispersion of returns between the top and bottom private equity (PE) fund is over 45%, and nearly 50% for venture capital funds.”
Morten W. Langer
