Workflow Bottleneck in Secondaries
Noel Moldvai and Adam Crawley, co-founders of Augment, on software-enabled secondaries markets
The core bottleneck in private stock trading is no longer demand, it is workflow cost. Earlier platforms could grow by adding brokers because the market was messy and trust had to be created manually. But once every new block still requires more people chasing leads, negotiating over email, collecting KYC, navigating ROFRs, and pushing documents to transfer agents, margins get squeezed and scale gets expensive instead of cheaper.
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The market is still mostly off platform. Handshake deals between funds, brokers, employees, and issuers remain common, which shows that matching and execution are not yet standardized enough for software to fully replace human coordination. That is why broker heavy models persist, even as they stay costly.
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The cost pressure shows up in commissions and channel conflict. Augment describes platform broker payouts compressing from above 50% toward roughly 25%, while many institutional brokers move to independent broker dealers where they can keep 70% to 90% of commissions. That weakens the economics of centralized broker led platforms.
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The strongest software wedge is not just matching buyers and sellers, it is removing the manual work around the trade. Carta used cap table software and transfer agent rails to simplify tender execution. Augment is trying to do the same for order books, company notices, KYC, messaging, and closing workflows across brokers, sellers, and issuers.
The next winners in secondaries are likely to look less like brokerages and more like market infrastructure. The durable advantage will come from owning the workflow system that makes each additional trade cheaper, faster, and more trusted, while still fitting the control needs of issuers and the relationship driven reality of brokers.