00:00Let's do a hard pivot to the secondaries market. It's shattering records. 2025 was its biggest year yet. Strong buyer
00:07demand met a surge in investor
00:08sales and manager led deals all fueled by the need for liquidity. Joining us now is Todd Miller global co
00:15-head of secondary advisory at
00:16Jeffries. And Todd I always find what your business is so interesting because you have a view of like literally
00:21the entire market of
00:23people wanting to sell chunks of private equity or private credit to get liquidity. 2025 was huge. How has 2026
00:29looked?
00:30Well thank you for having me here today. Appreciate the opportunity. 2026 has started off another strong first quarter of
00:36the year.
00:37You know you mentioned earlier this was a niche market. Actually this this niche market has actually gone mainstream and
00:43become really
00:43a central and core part of private equity today. We actually seen over the last decade almost a quadrupling in
00:50size of the secondary
00:51market. And today it's really being driven by two things. One is the desire for liquidity by institutional investors and
00:58the adoption of
00:58the secondary market by GPs looking to extend the hold period of some of their best assets. So I think
01:04it's fascinating as well
01:06because you have an incredible view across private market assets. Right. We're talking about these big IPOs coming due this
01:14year
01:14year. And everybody wants shares like that or shares in venture capital. Maybe buyout firms in private equity are still
01:23very
01:23healthy in terms of demand. I imagine private credit is less so. Can you can you ballpark us pricing right
01:29now? Yeah. I mean it's always
01:44trading at a 10 to 12 percent discount depending on what part of the asset class you're talking about. By
01:49the way Todd 10 years a 10 year old
01:51private equity asset. And I'm still learning all this stuff. But I imagine typically private equity would want to an
01:58exit before 10
01:59years. That's tough right. That's tough. And that's there's a reason it probably hasn't exited. And by the way we
02:05see things much
02:07older than 10 years on average private equity funds are wrapping up full liquidation around the 12 to 14 year
02:14mark. So there are
02:14still some assets left in these older funds. And however those are much more challenging and therefore the pricing is
02:20a much greater
02:21discount. How much are you seeing selling because of stress like beyond just the normal liquidity. But especially when it
02:29comes to
02:29private credit. There have been so many headlines. I mean this is more around the BDC is it. But that
02:33need for liquidity to fulfill
02:34redemptions. Are you seeing any of that come through. Very little stress in our market. I mean the capital markets
02:40broadly speaking
02:41in macro environments fantastic. It's at an all time high. So the last time we really saw stress in the
02:46market has been the GFC. And
02:48today it's really a desire to pull forward liquidity. I mean historically limited partners were receiving 20 to 25 percent
02:55of their
02:56NAV back annually and distributions over the last four or five years. That number has been closer to 10 percent.
03:02So the issue is starting to
03:04compound itself around the desire for liquidity. It's not a need. It's truly a desire. And that is really driving
03:11the market
03:11today. It's a LPs are using this as a portfolio management tool and not a liquidity driven market. So I
03:20mean to what do you
03:21attribute the booming nature of secondaries. We've talked to people who have raised you know 10 20 billion dollar funds
03:29in the last few
03:30months. Yes. Some of the largest funds in private equity are actually secondary funds. In fact last year three of
03:36the 10 largest funds
03:37were actually secondary funds. But some of it is capital formation. Some of it is an acceptance of the product.
03:44It's
03:44been it's broadly accepted today by limited partners and by GPs. Of the top 100 managers out there today 80
03:51percent of them have actually done a
03:53secondary transaction themselves meaning extending the life of a trophy asset to offer liquidity to L to LP. So it's
04:01truly just broad
04:02acceptance of the product. And that's why this feels like it's it's gone mainstream. It's no longer a niche strategy
04:08that we can
04:09see. Can you continue to see growing in the future.
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