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The Nasdaq Private Market, LLC (NPM), a leading provider of liquidity solutions for today’s private securities, has released its 2018 Year End Private Company report, which summarizes private company liquidity activity on the NPM platform.
NPM facilitated a record-setting increase in its annual transaction volume from $3.2 billion and 51 total programs in 2017 to $12 billion and 79 total programs in 2018. Factors that contributed to the strong momentum include: NPM supporting several large-scale transactions with a total value greater than $1 billion, a rise in the number of recurring programs on the NPM platform, and an increasing number of companies seeking to leverage NPM for price discovery, using auctions to determine the transaction value.
“We experienced record growth in 2018 as private companies look to our market-leading technology and expertise for their secondary liquidity programs,” said Eric Folkemer, Head of Nasdaq Private Market. “Private companies see the advantages in NPM’s experience, client service, and sophisticated buyer network. By taking a proactive approach to structured liquidity programs, our clients can give their employees and investors an opportunity to realize value during the pre-IPO stage of their corporate lifecycle.”
Private companies who used the NPM platform for secondary liquidity programs in 2018 include: Cohesity, Credit Karma, LegalZoom, Marine Layer, Opendoor, Rappi, Snowflake, and Tanium.
Additional findings from the report include:
- Buyer evolution: Third party tender offers doubled to 46 yearover year, outnumbering company repurchases for the first time on the NPM platform;
- Current and former employees are primary sellers: Companies continue to use controlled liquidity programs as a way to recruit, retain, and reward private company employees. On average, eligible sellers directed to the NPM platform included 90% of a client’s current employees and 50% of ex-employees. The median NPM client has 450 employees;
- Average company age & funding stage: Nearly half of NPM’s clients in 2018 were companies 10 years or older and the median funding stage is Series D;
- Recurring demand: Nearly 30% are returning clients to NPM, indicating strong demand for recurring liquidity programs.
Since its inception in 2013, NPM has facilitated over 230 transactions for private companies, facilitating $19 billion in transaction value, and supporting over 24,000 shareholders. For further information on NPM and to download a copy of the 2018 Year End Private Company report, visit www.npm.com.
