Secondary Market Booms: $106B Estimate Reveals Opaque $62.5B – $120.9B Range
- The secondary market for private equity and venture capital investments is booming, but pinning down its exact size is proving remarkably difficult.
- New data from PitchBook estimates that between 2025 $62.5 billion and $120.9 billion were traded in U.S.
- Unlike public markets with mandated disclosures, secondary transactions often involve smaller firms and individual investors operating with incomplete information.
The secondary market for private equity and venture capital investments is booming, but pinning down its exact size is proving remarkably difficult. While deal volume surged to record levels in 2024 and continues to climb, a lack of transparency and a fragmented landscape make precise measurement elusive.
New data from PitchBook estimates that between $62.5 billion and $120.9 billion were traded in U.S. Direct secondaries. This wide range—larger than the entire global market for soap—highlights the challenges in tracking activity in this rapidly expanding sector. For context, $50 billion represents the total volume for all of .
The opacity stems from the nature of the market itself. Unlike public markets with mandated disclosures, secondary transactions often involve smaller firms and individual investors operating with incomplete information. The dynamic, however, isn’t entirely dissimilar to public market behavior: a fear of missing out (FOMO) drives demand for stakes in high-growth, private companies like OpenAI, and SpaceX.
While the allure of exclusive access to pre-IPO companies fuels activity, the secondary market caters to a diverse range of participants. Large institutions like Goldman Sachs, Morgan Stanley, and Charles Schwab are increasingly involved, facilitating sizable deals—such as multi-million dollar stakes in companies like Anduril. However, a significant portion of the market operates through smaller brokers, connecting buyers seeking to invest a few hundred thousand dollars.
This fragmented structure contributes to a concentration of trading volume in a handful of highly sought-after companies. PitchBook data reveals that the top 20 startups on the Hiive private stock marketplace accounted for a staggering 86.4% of secondary trading value in the fourth quarter of . The top five—including OpenAI and SpaceX—represented 55.6% of that volume.
PitchBook’s current estimate for the U.S. Venture secondaries market lands at $106.3 billion, calculated by taking the midpoint of the estimated range ($91.7 billion) and adding an estimated $14.6 billion for GP-led venture secondaries. However, the firm acknowledges this figure is likely conservative, suggesting that the true size of the market remains largely unknown.
The growth in secondary market activity is driven by several factors. Companies are remaining private for longer periods, delaying traditional exit routes like initial public offerings (IPOs) and mergers & acquisitions (M&A). This creates a need for liquidity for both limited partners (LPs) and general partners (GPs) in private equity funds. LPs are turning to the secondary market to generate cash, while GPs are using it to restructure portfolios and manage fund lifecycles.
Several recent transactions illustrate the ongoing trend. Humand, a San Francisco-based AI operating system for remote workers, raised $66 million in Series A funding led by Kaszek and Goodwater Capital. Subject, an AI-powered curriculum platform, secured $28 million in funding led by Vistara Growth. Hypercore, an Israeli loan management platform for private credit funds, raised $13.5 million in Series A funding led by Insight Partners. These deals, along with others involving Coral Care, Giant, General Magic, and 7Rivers, demonstrate continued investor appetite for innovative, privately held companies.
The private equity space is also seeing significant activity. A consortium led by Affinius Capital agreed to acquire Veris Residential, a New Jersey-based real estate investment trust, for approximately $3.4 billion. Arctic Wolf, backed by Blue Owl Capital, acquired SevcoSecurity, a cybersecurity platform. Hamilton Lane, Braemont Capital, and Delta-v Capital invested $500 million in VFN Holdings, a fiber infrastructure business.
The secondary market isn’t without its complexities. The lack of standardized data and the prevalence of off-market transactions make it difficult to assess pricing and identify trends. However, the increasing involvement of institutional investors and the growing sophistication of secondary market participants are driving greater transparency and efficiency.
The surge in secondary market volume is also attracting attention from investment banks. Goldman Sachs’ recent acquisition of Industry Ventures underscores the growing recognition of the opportunities in this space. As the market continues to evolve, further consolidation and innovation are likely.
Despite the challenges in quantifying its size, one thing is clear: the secondary market is a force to be reckoned with. It provides a crucial liquidity solution for investors, facilitates portfolio management for GPs, and offers access to promising private companies. As the private capital markets continue to grow, the secondary market is poised to play an increasingly important role.