On March 25, 2025, CFA Society Liechtenstein hosted the 57th After-Work Lecture on the topic of "Private Equity Secondaries: Trends, Transactions, and Opportunities."
We were honored to have Boris Maeder, Head of International Private Wealth at Coller Capital, and Roman Eggler, CAIA, Head of DACH Private Wealth at Coller Capital, share their expertise. Here are the key take-aways from their presentation:
1️⃣ Illiquidity Premium as a Value Driver
Overperformance in secondary market transactions is driven by the illiquidity premium. This premium is not a “bug” or a drawback; rather, it’s an inherent feature that is needed for implementing value creation strategies which take time, and investors are compensated for it.
2️⃣ Early Liquidity Advantages of Secondaries
Unlike primary investments — where capital is locked long-term — secondary transactions allow investors to sell their positions before a fund’s maturity, providing faster access to cash.
3️⃣ Enhanced Transparency Compared to Primary Investments
With secondaries, investors have insight into the underlying portfolio’s composition, historical cash flows, and overall performance, reducing the uncertainty inherent in primary “blind pool” commitments.
4️⃣ Better Performance and Risk-Return Profile
Secondary investments tend to outperform primary investments on a median basis. The increased transparency and the existing track record lead to lower risk for the level of return achieved in secondary transactions.
5️⃣ Market Scale and Opportunity
💹 Transaction Volume: Approximately $160 billion in secondary market deals. ($500bn estimated by 2030)
📈 Total Investable Market: Estimated at around $10 trillion.
These figures underscore the size and growth opportunities within the secondary market space.
6️⃣ High Deal Selectivity and Investment Criteria
Boris and Roman share that at Coller Capital, an estimated 99% of the proposed deals are declined, indicating rigorous screening based on criteria such as cash flow performance (“CF counts”) and overall asset quality. Investments in venture capital (VC) and low-to-mid cap funds are generally considered too risky compared to more established or larger-scale assets.
7️⃣ Potential Benefits for buyers and sellers
Secondaries transactions provide advantages for sellers (liquidity, new capital, strategic portfolio management, retain star assets) as well as buyers (immediate valuation uptick, transparency, fewer early default risks, faster deployment, shorter holding period and potential for diversification).
🏅 A big thank you to Boris and Roman, for their insightful lecture, to the Universität Liechtenstein for hosting us, and to everyone who joined! Your participation helps us create an informed, connected community.
📅 Follow us on LinkedIn and stay tuned for details on our upcoming events where we’ll continue to offer opportunities for learning, networking, and growth! 🚀
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