Goldman Bets Big on Secondaries as a Problem Solving Business

What's New

The secondaries market has grown 100x from $2 billion in annual volume to over $200 billion, yet remains a tiny fraction of the multi trillion dollar private markets ecosystem it serves. In a conversation at the Goldman Sachs Alternatives Summit on the Alt Goes Mainstream podcast, Harold Hope, Global Head of Vintage Strategies at Goldman Sachs Asset Management, explained why the secondaries industry's defining characteristic is problem solving rather than discount hunting, why GPs actively resist the standardization that would turn the market into an efficiently traded platform, and why Goldman's acquisition of Industry Ventures signals that multi strategy specialization is becoming table stakes as the market scales toward $300B to $500B in annual volume.

Why It Matters

The pool of illiquid private market assets has tripled over the past decade, yet secondaries still represent only a small percentage of that base. Hope argues the market will remain structurally bespoke because GPs resist document standardization and fund stake trading, preserving advantages for scaled platforms that can deploy specialized teams, proprietary technology, and large pools of capital across an increasingly fragmented opportunity set. For LPs and wealth channel investors, this means secondaries is simultaneously one of the fastest growing and most relationship dependent corners of private markets.

Memorable Quotes

• On what drives innovation: "Every time there's been an innovation, it's been because there's been some problem and people don't know how to fix it. If it involves illiquid assets, the secondary market has said, 'We can figure out a way to do this.'" Hope frames secondaries not as a trading strategy but as a solutions business where each new structure emerged from a specific liquidity problem that had no existing answer.

• On why CVs exist: "Often times the company that's natural for them to exit is their best performer. And they feel like it's too early to sell that business, but they feel forced into selling it by the nature of their fundraising cycle." Hope pushes back on the misconception that CVs are a dumping ground for unsellable assets, arguing they solve a structural conflict between fund timelines and value creation timelines.

• On why standardization won't happen: "There's not really interest among the managers in having stakes in their funds traded. There's not interest in standardizing their documents with everyone else's." Hope argues that GPs actively benefit from bespoke, opaque fund structures, meaning secondaries will remain fundamentally different from traded credit markets despite growing scale.

• On scale as prerequisite: "Having over a hundred people in your investment team or having 14 engineers or a huge database that goes back 30 years and mining that with data and AI... those are only things you can do when you're at scale." Hope makes the case that secondaries is one of the rare strategies where larger platforms produce better outcomes, inverting the typical assumption that size erodes returns.

• On the valuation core: "Fundamentally this is a valuation oriented business. We are buying illiquid assets. There's not a ready mark on them. You've got to go figure out what the right price is to pay." Hope identifies valuation as the foundational skill, noting that a single portfolio purchase can involve pricing 400 companies simultaneously.

Big Picture Drivers

• Liquidity drought: The current distribution slowdown in private equity is creating unusually high demand for secondary liquidity, driving record volumes that will partially normalize but remain structurally elevated as the underlying asset base continues expanding.

• Specialization imperative: Goldman's acquisition of Industry Ventures reflects a broader shift where successful secondaries platforms need dedicated teams and capital pools across private equity, real estate, infrastructure, credit, and venture, each with distinct return expectations and valuation frameworks.

• CV market maturation: Continuation vehicles are solving a real structural tension between GP fundraising cycles and optimal exit timing, with early instances of CVs being layered on top of previous CVs, extending private ownership timelines further.

• Technology leverage: The ability to value hundreds of companies simultaneously in large portfolio transactions is becoming a technology problem as much as an investment judgment problem, favoring platforms that can invest in engineering talent and proprietary data infrastructure.

• Bespoke market persistence: GP resistance to document standardization and fund stake trading means secondaries will remain a relationship driven, negotiated market rather than evolving into a commoditized trading platform like bank loans.

By The Numbers

• $200B+: Estimated 2025 annual secondary transaction volume, up from $2B roughly 25 years ago when Goldman raised its first $400M secondaries fund.

• $300–500B: Hope's view on plausible near term market growth, supported by the tripling of the underlying private market asset base over the past decade.

• 400: Number of companies a secondaries buyer may need to simultaneously value in a single large portfolio acquisition.

• 100+: Size of Goldman's secondaries investment team, reflecting the headcount required to operate at scale across multiple asset class specializations.

• 14: Number of dedicated engineers within the secondaries platform, building proprietary data and AI tools against a database spanning 30 years.

Key Trends to Watch

• Venture secondaries acceleration: The explosion of venture capital formation and companies staying private longer is creating a rapidly expanding opportunity set that prompted Goldman's Industry Ventures acquisition to complete its multi strategy secondary buildout.

• CV on CV structures: Early instances of continuation vehicles being layered on previous CVs signal that fund structures are being stretched beyond their original design, creating new pricing and governance questions for secondary buyers.

• Technology as differentiator: The shift from manual portfolio valuation to AI augmented analysis will increasingly separate platforms that can price large, complex portfolios efficiently from those limited by human analytical bandwidth.

• Wealth channel entry point: Secondaries' combination of instant diversification, J curve mitigation, and all weather deployment capability is making the strategy a natural first allocation for retail investors entering private markets.

The Wrap

The secondaries market is experiencing a paradox of maturity and infancy simultaneously: it has grown 100x in volume and developed sophisticated structures like continuation vehicles, yet still represents only a small fraction of the illiquid asset base it serves. The firms that will dominate the next phase of growth will combine scale advantages in technology and team depth with genuine specialization across asset classes, solving bespoke liquidity problems for GPs and LPs in a market that its own participants are determined to keep from becoming standardized.

Watch Full Episode: Goldman Sachs' Harold Hope on Alt Goes Mainstream