Nasdaq Private Market Sees Surge In Deals With Many Large Startups Staying Private
(Bloomberg) -- Even as more tech companies list their shares in initial public offerings, a slew of high-profile startups like Uber Technologies Inc. are opting to stay private for as long as they can. To compensate, their investors and employees are finding more ways to trade shares.
According to a new report, the Nasdaq Private Market, which helps companies facilitate shareholder liquidity, beat its previous record in the number of deals and the dollar volume of the shares transacted in the first half of 2018.
“Private market deals are happening at a higher dollar value and more often than ever before,” said Ryan Logue, chief operating officer at Nasdaq Private Market. “Two of the three deals we’ve done that were over $1 billion in value happened in the first half of this year,” he said.
According to the report published Wednesday, the Nasdaq Private Market conducted 33 secondary programs in the first six months of 2018, compared with 19 in the same period in 2017. The total program value also rose to $10 billion in the first half of this year, up from $733 million in the same period a year ago, largely thanks to a few large deals. One of those was from Uber, according to a person familiar with the matter who didn’t want to be named discussing private matters. Still, Uber has said it plans a public listing in 2019.
Nasdaq declined to name any specific transactions.
While the number of buybacks from companies was nearly unchanged, the amount of third-party transactions nearly tripled. Logue said that a lot of the third parties on the platform are venture capital growth investors as well as mutual funds.
“The number of investors in the market looking to acquire stock has continued to rise,” Logue said. “A lot of the mutual funds out there are still very active in the private markets.”
©2018 Bloomberg L.P.