What’s the crossover between public and private markets and who is trading in private markets?

It's probably not surprising that the companies that tend to be most active across the private markets and the secondary trading markets specifically, and also are the most active on Caplight, are the largest, latest-stage, most well-funded companies that have the most investors and the most shareholders, meaning there's the most float or actual shares there to trade.

There's also a big informational component that comes with that. With the well-funded, very late-stage company -- I'm talking $10 billion plus valuation, as far as last private primary fundraising goes -- what comes with the very large valuation is a sense of comfort or transparency at least, in that there are other professional investors who do have full access to the information and management teams who are underwriting these companies and deeming them X valuable. That is now an anchor point for me as somebody who's on the outside looking in, who doesn't have that full information to get comfortable myself. That is a pretty strong mark as a starting point to research that I need to do now independently as an investor to make sure that this is actually risk that I want to take on.

If you look at CB Insights’s unicorn list and you work your way from biggest to smallest, you see the concentration of where private markets trading is in that first 25 especially, and then it slowly trickles off the further down that list you go. That said, we've seen orders come in for billion-dollar companies to do derivatives on, whether that's looking for long exposure because you’re really bullish on a company -- you want to buy a call option because you think this thing is going to be a hundred billion dollars, so you buy the call option at a billion dollars strike; that's a way to really lever a long position -- or “I was the very first institutional money into this company, and I'm sitting on a 2000% return. I need to think about my investors, and this is my first fund. If I can lock in my fund’s return based on this massive position, that makes my life a lot easier.” I think we'll eventually get there in terms of being able to transact in earlier-stage companies. But for now, across the board you see activity concentrated around typically the 25 biggest.