Launchbay VC

H1 2024: 3 trends in VC/growth secondaries market

Market insights

27 August

1. Rising volume

According to Setter Capital, venture fund secondaries had a record setting 151.3% ($2.66 billion in H1 2024 from $1.06 billion in H1 2023) increase in volume.

According to Campbell Lutyens, the market for technology and VC / Growth assets strengthened in the first half of 2024 for the first time in a couple years as interest rates and valuations began to stabilize. LP-led volumes for VC / Growth funds grew by 135% compared to H1 2023, increasing by nearly $2bn. Over the same period, Information Technology nearly tripled its share of GP-led transactions, representing one-third of the volume in H1 2024. Increases in public multiples during the first half of the year created an opportunity for optical discounts in the private market, driving increased demand.

2. Improving pricing

According to Campbell Lutyens, appetite for Venture / Growth increased, supported by strong momentum behind technology in the first half and a desire to backfill gaps in exposure. This led to a shift in pricing for Venture / Growth funds which increased by 17 points compared to H1 2023.

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According to PJT Partners, Venture/Growth pricing benefitted from green shoots in the IPO market, allowing secondary buyers to underwrite exits aith more conviction, PJT Partners reports pricing increased on 5 percentage points YoY.

According to Jefferies, venture pricing showed signs of improvement, rising by 200 basis points from H2 2023. While there was demand for revenue-generating, later-stage assets with a clear path to exit, valuations were still viewed as inflated amid limited improvements in fundraising, and buyers were primarily bidding for venture funds as part of a diversified portfolio.

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