Overcoming the 'liquidity timebomb' in early-stage investing

Use of private secondary markets 'vital'

It is not uncommon for today’s fast growth companies to remain private for up to a decade or more, a trend that is expected to continue following the failure or subsequent poor performance of a number of high profile IPOs this year.

While the public markets still work as expected - providing real scrutiny of inflated valuations or unprofitable companies - it also means that early stage investors can find their capital locked up for ever longer periods. Today, there are more sources of early stage capital than ever before, particularly if you have a big idea and can demonstrate proof-of-concept. Why VCT investing is more important than ever Tech companies founded in the 1980s and 1990s targeted an IPO at an early stage of their development. Many took venture capital along the way, but rarely kept returning t...