The state of the private markets

I’m writing our quarterly private market update for our newsletter to go out this week. Things are just a bit strange right now with the dynamics going on.

The window IPO is virtually closed for anyone not named SpaceX, Anthropic, or OpenAI. Those 3 companies will likely debut at over $1T each when they do decide to go public. Besides those 3 companies, there’s maybe 10 others generating interest in the secondary markets. The concentration of demand is something that I haven’t seen in my last 8 years working in this space.

On top of that, virtually all deals being done seem to be either VC selling off their positions or people selling SPVs. There are very legitimate SPVs and they serve a purpose in the market. However, whenever there’s a wealth creation event, there will always be grifters and people flocking to the space to get rich quick.

There are a ton of SPVs being offered and this feels like 2021 all over again, but on a much bigger scale. For better or worse, everyone wants a piece of the action again in the private markets. Once the dust settles, unfortunately a lot of people are going to get burned.