Secondaries report

Annual Secondaries Report 2021: Key findings

How has activity around secondaries changed in the last 12 months? What key trends do secondary fund managers expect to see in the near future? Investec’s Secondaries Report, which canvasses views from 44 secondary fund managers, answers both these questions and more in this year’s report.

For the past three years, Investec has conducted research looking into key trends within the secondaries market and the expected changes. The research is derived from speaking to 44 secondary fund managers from across the globe. A number of professionals also took part in in-depth interviews and conversations to provide further context.

In last year’s report, we saw the early impact of Covid-19 on the secondaries market. Transaction volume was down and buyers were looking for larger discounts to NAV, mainly to compensate for the additional market risk.

One year on, although still in the middle of the Covid-19 pandemic, confidence in the return to a more familiar level of market activity is increasing due to global vaccination programmes being rolled out. However, this year’s report does outline that there are still some areas of concern.

Head of Secondaries, Ian Wiese commented: “The secondaries market continues to evolve and, whilst it has not escaped the effects of Covid-19, neither has it suffered the long-term impact some feared.”

 

Download the full report PDF 8.76 MB

 

 

What next for the secondary fund space?

Looking ahead, the consensus among the managers surveyed in this year’s report is that there are plenty of reasons to be optimistic. Deal flow may have slowed down in some areas when the impact of Covid-19 was beginning to be felt, but 77% think they will see dramatic improvement within 12 months.

Additionally, the secondaries market continues to evolve. Investec head of origination and NAV financing, Jon Harvey agreed:

“Creativity in the secondary market is increasing rapidly. Advisors and GPs alike continue to find innovative ways to put capital to work. Financing solutions need to keep apace and lenders will be asked for a range of different options for different portfolios and situations.”

Ian Wiese concluded with his thoughts ahead of a pivotal year for the secondary fund space:

“The trend towards hybrid and increasingly complex transactions is sure to continue, with the increased blurring of the worlds of primary and secondary inevitable. What were once distinct categories – traditional secondary sales of LP portfolios on the one hand and primary deal-making on the other – are no longer either of those things. At Investec, we continue to work with all manner of market participants, across the cycle, supporting them at the fund and transaction level.”

Download the full report PDF 8.76 MB

 

 

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  • Stuart Ingledew

    Stuart Ingledew

    Stuart Ingledew

    Fund Solutions

    I provide a range of flexible financing solutions to private equity funds and fund management teams. I work with a range of primary, secondary and fund of funds based throughout the UK and Europe to provide GP facilities, capital call facilities, concentrated NAV facilities and secondary leverage.

Contact us

Stuart Ingledew

Stuart Ingledew

Fund Solutions

I provide a range of flexible financing solutions to private equity funds and fund management teams. I work with a range of primary, secondary and fund of funds based throughout the UK and Europe to provide GP facilities, capital call facilities, concentrated NAV facilities and secondary leverage.