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Secondaries Market Poised for Eruption in 2023


Let's delve into a part of the alternative investment industry that is often overlooked but vitally important to our financial markets' functioning — the secondaries sector.

Secondaries investors have enjoyed a hot streak in recent months, with the total volume of transactions hitting a record $57 billion in the first half 2022, easily surpassing the previous high of $48 billion set in the first half of 2021, according to Jefferies’ review of the global secondary market. This activity has continued into the back half of 2022 and now 2023 as a growing number of LPs and GPs look to rebalance their holdings due to what is known as the “denominator effect.”

This effect occurs when there is a significant drop in value of one portion of an institutional allocator’s portfolio, thereby dragging down the overall value of the portfolio. This happened to many allocators in the second half of 2022 due to a downswing in the public markets, which left some institutional investors over-allocated to private assets. To correct for this imbalance, allocators are now looking for ways to exit longer-term investments in private equity and other assets. With traditional exit options limited – partly due to a lack of appetite for IPOs – both LPs and GPs are turning to the secondaries market in their search for liquidity.

This trend also applies to the private credit market. Some optimistic prognosticators have speculated that the market for private credit secondaries could grow threefold over the next four years to reach $50 billion, compared to about $17 billion now. This potential for rapid growth is also visible in more niche parts of the secondaries market.

For instance, there is also growing demand for secondaries in the ESG and impact investing markets. North Sky Capital, which manages a series of impact secondaries funds, has recently hired a European managing director (Stefan den Doelder from Stafford Capital Partners) to help the firm capitalize on an expected boom in impact secondaries. Commenting on the current state of the market, Scott Barrington, founder of North Sky Capital, said: “We think 2023 is going to be a boom year for secondaries investors generally, and impact secondaries specifically, because so many institutions are going through a denominator effect problem.”

All this is great news for the legions of capital raising professionals looking to enter the secondaries sector or move up in their existing roles. As we discuss below, we have tracked 153 senior hires among secondaries firms in the three-year period from 2020-2022. Here is a selection of hiring activity based on reports from Private Equity Career News:

  • In May 2022, ORIX Corporation USA said they were looking to expand a GP Solutions team headed by newly installed Managing Director Jed Johnson
  • In August 2022, placement agent Triago was reported to have undergone a rapid expansion to keep up with its advisory business on GP-led secondary deals
  • In November 2022, Silicon Valley Bank hired long-time W Capital Partners executive Alison Killilea (Neuwirth) as Managing Partner for secondaries

Other financial services firms to make secondary hires in recent months include Guggenheim Securities, TPG and William Blair.

The secondaries market has proven to be unusually resilient in the face of market shocks, from the COVID-19 pandemic to inflationary fears spreading around the world. This is a testament to the continued growth and sophistication of this market as well as the strong demand for secondaries among sophisticated investors. According to a survey of investors by Private Equity International, more than half of LPs (56%) plan to back PE secondaries funds in 2023. This means more fundraising opportunities for secondaries funds and more job opportunities for secondaries specialists.

Keep reading to dive into our hiring data and insights into hiring trends across the secondaries market.


Sasha Jensen

Hiring Data for the Secondaries Market

Then Jensen Partners team analyzed the demand for capital raising professionals from 2020-2022 in the secondaries market and found evidence for 153 total hires. However, looking more closely at the hiring data over this three year-period suggests this hiring boon is just the beginning.

  • 2020 – 16 secondaries hires
  • 2021 – 60 hires
  • 2022 – 77 hires

We are already seeing signs that 2023 could be a record year for hiring in the secondaries market, a theme we will continue to highlight in our quarterly newsletters.

We also broke down the data by gender and ethnicity to see if the secondaries market is following in the footsteps of other sectors of the alternative investment industry by prioritizing diversity in hiring decisions. However, we found that only 15% of the total hires during this period were women and just 22% were people of color, noticeably below the diversity ratios we have recorded for the rest of the alts space. For example, in 2021, 39% of all marketing hires identified as women and 23% were people of color. (Stay tuned for 2022 figures in our upcoming Q4 2022 newsletter!)

We also saw disparities in the potential for receiving promotions. Our data analysis shows that male professionals have a higher percentage of promotions over the past three years when compared to women, whereas women have a higher percentage of junior to senior promotions when joining a new company. This suggests that men get promoted more often within their current company whereas women are more likely to get promoted when joining a new company.

This data shows that there is significant room for improvement in representative hiring and equal promotion opportunities as the secondaries sector continues to grow and mature.

News Corner

Here is a selection of recent news articles and research studies about the secondaries market.

Bloomberg: Carlyle Reorganizes Secondary Unit to Focus More on Credit

Bloomberg: DWS Weighs Sale of Private Equity Secondaries Business in Revamp

HamiltonLane.com: What’s Driving the Secondary Market?

New Private Markets: North Sky hires in Europe ahead of ‘boom year’ for secondaries dealflow

New Private Markets: Why the secondaries market will be impact-flavoured in 2023

PEWire: Bellevue hires private equity secondaries team

PEWire: Investors selling PE stakes at record rate

PitchBook: PE secondaries market set to boom in 2023

Pitchbook: Secondary trading picks up as market settles into discount mentality

Secondaries Investor: DWS’s reported sale of its secondaries business swims against the tide

Secondaries Investor: Market supply for secondaries transactions over $150bn

Secondaries Investor: Next Gen Leaders of Secondaries: Class of 2022  

Secondaries Investor: Secondaries fundraising drops by half as LPs feel the pinch

Secondaries Investor: Secondaries Investor Advisory Survey 2022: Advisers Adjust to new Conditions After Record Year 

Secondaries Investor: Secondaries’ journey to the mainstream

Secondaries Investor: SI 50: Secondaries Scales New

Wall Street Journal: Proposed SEC Rules Would Raise Scrutiny of Sponsor-Led Secondary Deal

Marketing Moves

Here is a curated selection of recent marketing moves within Secondaries:

Joel Hughes joined UBS Private Funds Advisory in August 2022 as a Director with the EMEA Secondary Advisory team in London. He joined from Coller Capital where he was a Senior Associate.

Kevin Nowaskey joined Eaton Partners in September 2022 as a Director, GP Advisory and Secondaries. This comes after a six month stint as an Executive Director at Moelis & Company. He is based in New York.

Alex Mejia, Head of Goldman Sachs' Secondary Advisory, left to join Baird Capital in December 2022 as Co-Head of the Global GP Solutions Group to spearhead the buildout of a secondary advisory team. He joined Goldman 18 months ago.

Jake Stuiver joined William Blair in September 2022 as a Director on the firm's recently built out Secondary Advisory team. He recently left M2O Private Fund Advisors where he was a Principal on that firm's Secondary Market Advisory team for a year and a half. He is based in New York.

Michael Wieczorek joined DC Advisory, the investment banking arm of Daiwa Securities Group, in September 2022 as a Managing Director where he will advise on GP-led deals from his base in London. He left Elm Capital in July 2022 after a year with the firm as a Partner.

Sebastien Siou joined ex-Park Hill Jonathan Costello's recently launched Devon Park Advisors in December 2022 as a Partner from Whitehorse Liquidity Partners where he was a Partner for three years. He is based in Toronto.

Ian McLean joined Devon Park Advisors in December 2022 as a Managing Director. Most recently, he was with Oaktree Capital Management as a Senior Vice President of Infrastructure Investing. He is based in Greenwich.

Jeremy Duksin has left his Managing Director and Global Head of Capital Solutions role with Credit Suisse's Secondary Advisory business in December 2022 to join Robert W. Baird & Co. as Co-Head of Secondary Advisory. Alex Mejia will serve as Co-Head alongside Duskin.

Jeffrey Bollerman has signed on to join Raymond James' Private Capital Advisory business as a Managing Director in New York. He joins from Houlihan Lokey where he was a Managing Director and founding member of the firm’s secondaries practice.


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