Cadence Drives Private Stock Liquidity
Charly Kevers, CFO at Carta, on progressive price discovery and investor relations
The real bottleneck in private stock liquidity is not buyer interest, it is trust in a repeatable process. Investors will only keep showing up if a company sets a stable rhythm for disclosures, meetings, and trading windows. That rhythm turns a one off private sale into something closer to a market, where buyers can underwrite the business, sellers can plan, and the stock can develop a believable price history.
-
Tender offers solve liquidity in bursts, but they are heavy to run and often tied to stale round pricing. Carta positioned recurring auctions as a way to let employees sell smaller amounts more predictably, which reduces the pressure to swing for the highest price in a single event.
-
This is the same muscle companies need before going public. Spotify used quarterly secondary trading, regular shareholder calls, and repeated disclosures to build price history and investor familiarity before its direct listing. The point was not just liquidity, it was training the market to follow the stock.
-
Without that cadence, buyers apply a large uncertainty discount or skip the name entirely. In adjacent interviews, investors describe private secondaries as hard to transact when information arrives irregularly and management is not set up to educate new buyers. Predictability is what makes the education burden manageable.
The next step for late stage private companies is a lighter version of public market investor relations. The winners will be the ones that pick a cadence, keep it, and slowly widen participation over time. That is how private stock moves from episodic liquidity to durable liquidity, and how a company earns the option to stay private longer without losing talent or investor demand.