Unclear ownership in private secondaries
Dan Akivis, senior associate at Expansion VC, on selling secondary and managing LP relationships
The core risk in private secondaries is not just bad pricing, it is broken ownership clarity. In practice, a buyer may not be purchasing the company shares directly, but an interest in one vehicle that owns another vehicle that only has economic exposure to the shares. That stack makes diligence, transfer rights, fees, and information rights harder to track, which is why private market liquidity still feels far less legible than buying public stock.
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The market often routes around direct share transfer with wrappers like SPVs, forward contracts, and fund interests. Those structures can solve cap table and approval frictions, but they also separate the buyer from the underlying asset, so the buyer may own exposure rather than clean title to the stock itself.
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This complexity persists because most private trades are still broker driven and fragmented. Handshake deals, emails, and overlapping intermediaries create weak price discovery and frequent confusion over who the real buyer is, what fees sit in the chain, and whether the trade will actually close.
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The winning platforms are the ones that reduce layers and make the company part of the process. Issuer aligned models like tender programs, transfer agent workflows, or a single shareholder of record make the asset easier to understand because the company, the seller, and the buyer are all operating from the same ledger.
The market is heading toward fewer wrappers, fewer middlemen, and more standardized company approved pathways. As that happens, secondaries should look less like bespoke legal engineering and more like a real market, where buyers know exactly what security they own, what rights come with it, and how price is formed.