The August 2026 Connetic Signal examines what the pre-IPO secondary pitch is missing, what the data says about advertised markdowns, and how Venture360 is standardizing private-market operations.
Hello There,
If you manage money for high-net-worth clients, you have probably fielded this question: “Why don’t we own pre-IPO shares of Anthropic or OpenAI?” In June, SpaceX gave one answer — it listed on Nasdaq, and some investors who held it through a fund began finding out what they actually owned.
The pitch sounds like a shortcut to private tech returns. But behind the headline discounts lie compounding fee stacks, transfer restrictions, fraud risks, and uncorrected valuation overhangs. This month, we break down what the secondary pitch is missing, what the data actually says about advertised markdowns, and why foundational infrastructure platforms like Venture360 are standardizing private market operations.
Featured Advisor Commentary
The Secondary Market Looks Like a Shortcut. It Isn’t.
Chris Hjelm
Portfolio Manager & Head of Investments, Connetic RIA LLC
When retail clients demand pre-IPO access to household tech giants, wealth managers are often caught between saying yes to opaque SPV broker chains or losing the conversation entirely. But a discount from peak valuation is not a bargain when companies restrict transfers, fees compound three layers deep, and private multiples remain double public comps.
“Somewhere between 20–35% of people who believe they own late-stage secondary exposure through informal SPV chains are going to get an unpleasant surprise when that verification event happens at S-1.”
The full piece covers the 4 structural traps, the math behind multi-tier SPV carry drag, a 10-question advisor guide, and why early-stage discovery offers a cleaner entry point before consensus forms.
VCAFX is a closed-end interval fund designed for long-term investors. It is not a liquid investment. See the important Fund disclosures below and read the prospectus carefully before investing.
Data Corner
The Discount Mirage: A Markdown Is Not a Bargain
35%–45%
Advertised secondary discount from peak
>25%
2021 unicorns now worth under $1B
A 40% discount on an asset priced at 214% of intrinsic value is still an expensive mistake. In secondary markets, advertised markdowns frequently mask uncorrected valuation overhangs.
Illustrative figures only. They do not represent any actual company, security, transaction, or investment, and are not a projection or prediction of any outcome.
See the full valuation anatomy chart and holding horizon stretch on the Data Corner page.
Sources: Advertised secondary discount range and 2021-cohort unicorn impairment, PitchBook, 2025 Annual U.S. VC Valuations & Returns Report (Feb. 11, 2026). The 214% figure is arithmetic internal to the hypothetical illustration shown in full on the Data Corner page. Statements attributed to Chris Hjelm are his views as of the date shown and are not statements of fact.
Venture360’s portal coordinates fund accounting, SPV onboarding, and secondary liquidity. Image: Venture360.
While public markets standardized digital trading and custody decades ago, private markets developed around manual friction. Based in Kansas City, Venture360 provides the unified operating layer supporting over $3B+ in capital deployed across 2,800+ investments.
This company is discussed for educational purposes only. Companies featured in this section may be held by one or more Connetic-advised accounts. References are not endorsements or performance indications. Holdings are subject to change.
PitchBook · Michael Bodley and Kia Kokalitcheva · March 16, 2026
As companies stay private longer, employee tender offers have grown larger and more common, often paired with a new primary round. But PitchBook notes the venture secondary market lacks the disclosure rules of public markets, buyers do not necessarily have complete information, and activity stays concentrated in a handful of names.
The US venture secondary market reached $121.7 billion in the twelve months to Q2 2026. PitchBook also covers friction directly relevant to this issue: one large AI company’s restrictions on special purpose vehicles, and the fee and disclosure problems it expects to surface as lockups expire.
Chris Hjelm
Portfolio Manager & Head of Investments, Connetic RIA LLC
