Founders, do you understand the secondary market?

Founders, do you understand the secondary market?

It is now at the center of how venture capital operates. My understanding of secondaries is that they were an afterthought, a back-channel for the rare founder after a large Series B+ or investor exit. I didn’t know much about them. I am seeing that change fast, and I am digging into the details. Liquidity has become a major pressure point across venture (well, more than normal), and the secondary market is evolving to help solve this.

I was at an event last week at the New York Stock Exchange with Forge, the message seemed pretty clear: secondaries are no longer niche. Secondaries are becoming a critical lever for investors, founders, and the entire startup ecosystem. From what I have read, VCs themselves are using the secondary market to sell fund positions, create liquidity, and manage their exposure, all while the companies they’ve invested in remain private.

This shift isn’t theoretical.
It’s happening now, and I feel that founders need to understand how it could reshape fundraising, cap tables, and the path to liquidity.
The reality is, liquidity has always been the unsolved challenge in venture capital.
The typical 7 to 10-year lock-up period for investors and early shareholders often doesn’t match the pace or needs of today’s wealth ecosystem.
At the event, there was a lot of discussion around how the secondaries market is evolving to address that.

Platforms like Forge are expanding access to the private markets by offering diversified, index-like products and secondary trading opportunities. These tools help investors engage with private companies and create pathways for earlier liquidity, without waiting solely on IPOs or acquisitions.

What does that mean for you as a founder?
Growing secondary activity gives investors the option to recycle capital sooner, which can impact future rounds
Founders and early team members may gain structured, compliant ways to access partial liquidity if an exit or IPO is not likely
There’s a shift happening, holding private stock no longer means binary, all-or-nothing outcomes

Liquidity remains complex, but the tools and market appetite are changing quickly. As a founder, understanding how secondaries intersect with cap table strategy, valuation, and growth planning is becoming essential. If you want to unpack any of this, or how I see it playing out, I’m always happy to chat. I am not an expert, but now I have some great connections and insights.