The secondary market is no longer just for LPs seeking early liquidity. With trillions in unrealized private assets, it's becoming a primary way for investors to gain exposure, akin to buying a public stock. One can now buy into established private companies directly, not just new funds.

Contrary to the VC fear that early liquidity demotivates founders, Amanda Kahlow argues it does the opposite. Taking money off the table provides comfort and security, allowing founders to put more energy into the company and take bigger risks for a larger outcome.

The traditional IPO exit is being replaced by a perpetual secondary market for elite private companies. This new paradigm provides liquidity for investors and employees without the high costs and regulatory burdens of going public. This shift fundamentally alters the venture capital lifecycle, enabling longer private holding periods.

Sophisticated investors no longer use secondaries just to quickly build a private equity program. The strategy has matured into a core allocation, valued for offering faster deployment, better cash flow control, and consistent performance across market cycles.

Contrary to popular belief, staying private isn't always easier. The administrative burden of managing secondary share sales and controlling who gets on the cap table is a significant headache for CEOs, making an IPO an attractive solution for simplicity and control.

Vested works directly with employees because startups find small, one-off secondary transactions burdensome due to legal fees and cap table complexity. However, this dynamic inverts at scale. Once Vested facilitates millions in transactions for a single company's stock, the startup has a strong incentive to partner on a formal liquidity program.

The traditional VC model of waiting for an IPO or acquisition is obsolete. With companies staying private for 20+ years, firms must develop the skill of actively selling positions in secondary transactions to provide necessary liquidity for their LPs.

Just as buyout funds began selling portfolio companies to other buyout funds post-2000, VCs now increasingly exit via secondary sales to other VC or PE firms. This has become a dominant liquidity path over traditional IPOs or strategic M&A.

Rather than making emotional decisions, top VCs now use a formulaic approach to secondaries (e.g., "sell 15% of a position to return 0.5x of the fund"). This codification makes the process transparent to both LPs, who want to see distributions, and founders, removing guesswork.