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VC Fund Secondary: Buy the Winning Ticket at Halftime (at Half Price)

  • Writer: PrimeAlpha Thought Leadership
    PrimeAlpha Thought Leadership
  • Jun 10, 2020
  • 2 min read

Updated: Mar 18

VC Fund Secondary: Buy the Winning Ticket at Halftime (at Half Price)


Skip The J-Curve: Buy Venture Capital Funds After They’re Already Winning


Venture capital (VC) is notorious for its high risk and long-term commitment, as most startups fail and most investments typically yield no return. Traditional VC funds often don't make distributions in the first five years, and exits can take up to 15 years, making it a challenging asset class for those lacking patience. However, the upside potential is considerable, with top VC funds significantly outperforming other markets and occasionally delivering exponential returns.


An alternative approach to conventional VC investment is entering the market through secondary VC funds that have already demonstrated success, a strategy known as "skipping the J-curve." This method allows investors to buy into VC funds at a midway point, often at a discount, as original investors seek liquidity. This secondary market presents a unique opportunity for new investors to capitalize on proven winners without enduring the initial slow and uncertain phase.


Access the entire article to delve deeper into the world of secondary VC investments. Discover how you can skip the traditional J-curve and tap into the growth potential of venture capital with shorter liquidity periods and fewer risks. Learn how investing in funds that are already winning can provide faster returns and significant discounts, offering a smarter pathway into high-stake venture capital markets.



If you do not have a work email address, please email us at info@primealpha.com and we can email you the report directly.



Table of Contents

  • Skip The J-Curve: Buy VC Funds After They’re Already Winning

  • Why VC Secondary? No “Blind Pool,” Faster Growth, Shorter Liquidity

  • Fund Secondary vs. Company Secondary

  • Seller Motivations: Strategy, Tragedy, Liquidity, Victory




Thanks to our Contributor


Practical Venture Capital Logo


Practical Venture Capital is a Silicon Valley VC secondary firm that buys fund interests from LPs and GPs in top-performing VC funds.

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