Ardian’s landmark $30 billion raise for its secondaries fund in January 2025 marked a defining moment for private markets. It became the largest secondaries fundraise in history. The scale of this fund is emblematic of how far the secondaries market has come amidst the rough exit environment.
Secondaries Surge as LPs and GPs Seek Liquidity and Flexibility
This milestone was set against a record-breaking year for secondaries overall. According to Evercore’s 2024 Secondary Market Review Report, the total global transaction volume hit $160 billion in 2024, well above the previous peak of $134 billion in 2021. Limited partners (LPs) and general partners (GPs) alike turned to the market to unlock liquidity and rebalance portfolios amid prolonged exit timelines. The activity was evenly spread between LP-led deals, which totaled $89 billion, and GP-led transactions, which climbed to a record $71 billion. The scale and balance of these flows indicate a market that has matured in structure and relevance.
Figure 1: Secondaries Reach Record Volumes in 2024
Source: Evercore FY 2024 Secondary Market Review
The acceleration in LP-led deals reflects a structural challenge: a persistent shortfall in distributions. Despite modest improvements in public markets, many LPs continued to experience net negative cash flows, driven by delayed exits and muted realizations from traditional private equity (PE) strategies. Firms like Carlyle Group have postponed plans to divest key assets, such as the IPO of luxury watch parts manufacturer Acrotec Group and the sale of airfield lighting group ADB Safegate, due to current market challenges. As a result, LPs increasingly turned to the secondaries market, not just as a reactive measure but as a proactive portfolio management strategy.
Equally notable was the surge in GP-led transactions, which are no longer viewed as defensive plays but as essential liquidity and value-creation tools. Continuation funds gained further prominence, accounting for 14% of total sponsor-backed exits globally in 2024, as per Evercore. GPs leveraged these structures to retain control of high-conviction assets and provide optionality to their LPs. The broader acceptance of continuation vehicles by investors speaks to the growing sophistication in how GPs manage portfolios and optimize exit timing, especially in an environment where traditional M&A and IPO routes remain constrained.
Retail Capital, Rising Dry Powder, and the New Dynamics of Buyer Demand
The evolution of buyer demand is another trend responsible for this growth. The expansion of retail capital, particularly via ’40 Act funds, has broadened the investor base for secondaries. These vehicles offer retail investors exposure to private markets with mitigated J-curve effects and more predictable cash flows. As regulatory changes potentially expand retail access to private capital, secondaries are likely to benefit disproportionately. Their ability to provide exposure to seasoned portfolios with clear cash flow visibility makes them a natural entry point for non-institutional capital.
The growth led to an abundance of dry powder in the secondaries market. According to Evercore, as of 2024, secondaries-focused dry powder stood at $216 billion, a 14% increase over the prior six months. The top twelve buyers controlled 56% of this capital, underscoring the growing concentration at the top, but the market also saw an influx of new entrants, including retail-focused vehicles. This bifurcation between heavyweight platforms and innovative, nimble challengers has increased competition for high-quality assets, especially those offering near-term distributions or minimal unfunded commitments.
Scratching the Surface of a $3.6 Trillion Liquidity Challenge
Despite these strengths, the secondaries market is still only addressing a fraction of the liquidity challenge. According to Bain’s Global PE Report 2025, as of June 2024, global buyout funds are sitting on an estimated $3.6 trillion worth of unsold companies, highlighting the sheer scale of unrealized value in the system. While secondaries have grown rapidly, they are still scratching the surface of potential demand. As PE firms continue to face pressure to deliver distributions, especially in an environment of limited exits and tighter fundraising conditions, the secondaries market is expected to absorb more volumes.
Looking ahead to 2025, the tone appears cautiously optimistic. Many anticipate a more active M&A environment supported by lower interest rates and a potentially more pro-business policy backdrop in the US. While improved exit conditions will likely reduce the urgency for liquidity-driven sales, the foundational role of secondaries in portfolio management is unlikely to change. Repeat sellers, particularly institutional investors with well-defined strategies, will likely remain active, while the continued growth of evergreen and retail-accessible vehicles ensures that demand remains robust.
In sum, secondaries will transition from being a tactical liquidity tool to a strategic pillar of private capital markets. The trends observed in 2024, from record-breaking fundraises and transaction volumes to evolving deal structures and buyer profiles, point to a market that is maturing and institutionalizing at a fast pace. Even as traditional exits begin to recover, the flexibility, transparency, and capital efficiency offered by secondaries will ensure their continued relevance in 2025 and beyond.
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