Strategies Secondary Investments

A shorter duration complement to an overall private markets portfolio

The secondary market has been an attractive place for investors to deploy capital as demonstrated by the growth in both transactions and fundraising. As this market has become increasingly mature and sophisticated, transaction structures have grown more complex. We believe today’s market conditions, characterized by the global growth of private markets and more active management of private market allocations, lend themselves to the strengths of our differentiated approach. With 24+ years of experience in this market, we remain focused on finding value in more complex and innovative secondary opportunities.

Our goal is to provide investors with significant capital appreciation by delivering attractive risk-adjusted returns. Through our unique approach and competitive positioning, we have implemented this strategy by focusing on:

  • Quality, mature assets
  • Partnering with quality general partners
  • Flexibility and expertise across the spectrum of secondary investments
  • J-curve mitigation and cash yield
$238B

In Deal Flow in 2023

$19.5B

Committed Across 395+ Transactions

24+

Years of Secondaries Investing Experience

As of 3/31/2024


Deal Spotlights

Project Atlantico

Who they are

An LP portfolio consisting of 17 fund interests that hold 300+ companies.

Why it matters

The portfolio is broadly diversified across high-quality GPs with which we have had long-standing relationships. We have previously invested alongside 100% of the GPs in the portfolio.

 

The HL advantage

We had full access to all GPs, having dedicated calls with each one, positioning the firm favorably in a process whereby some GPs prohibited the seller from disclosing some, if not all, information on their funds his competitive advantage allowed us to swiftly determine the most attractive combination of fund interests in the portfolio. As a result, we were able to preempt a broader competitive process as well as negotiate a 50% purchase price deferral, positively impacting returns.

The bottom line

The combination of high-quality GPs, an attractive split of fund vintages, underlying diversification, a strong purchase price deferral and our information advantage made this a highly compelling transaction.

Project Bull

Description

A GP-led transaction involving a tender offer for interests in the GP's two prior vintages as well as a late primary commitment to the GP's newest fund.

Why it matters

The portfolio consists of 24 North American mid-market companies across diverse sectors including Business Services, Industrials and Consumer. Valuations are broadly in-line with or below comparable companies, and operational performance is trending above prior years for much of the portfolio. The seed portfolio for the late primary has already seen early mark-ups while the two older vintages have potential for near-term liquidity, providing a balance of potential value appreciation and liquidity.

The HL advantage

Our familiarity with the GP gave us strong conviction in the GP’s ability to drive growth and exit similar businesses across market cycles. We stood out in the restricted process due to our platform’s prior investments in the GP’s funds, our reputation as a value-added limited partner, and our flexibility to offer LPs several options, including deferred payment in exchange for a reduced purchase discount.

Project Somerset

Description

An acquisition of a portfolio featuring four fund interests across two reputable general partners.

Why it matters

The selling LP, facing liquidity challenges, approached us due to our 10+ year relationship. We were then provided with a unique opportunity to access a direct, proprietary transaction. The deal showcases our ability to successfully navigate liquidity challenges and seize a favorable position in the market.

The HL advantage

The deal stems from our long-standing relationship with the seller and prior investment in a significant asset within the portfolio. This familiarity allowed us to confidently navigate the complexities of the deal, leverage existing underwriting for conviction in entry valuation and future performance expectations, and ultimately secure an attractive price in a proprietary transaction.

Read our take on the current Secondaries landscape
The secondary market has seen exponential growth over the last several years. With our experience, scale and network, we believe we’re well positioned to deliver attractive risk-adjusted returns to our clients.
Tom Kerr
Head of Secondary Investments, Co-Head of Investments

Utilizing our market-leading data to gain a greater level of insight

Our proprietary technology combined with our database of over 22,200 funds and 160,800+ private companies provides a unique advantage to better understand the drivers of value within a deal. Our data advantage and extensive global primary platform represent a crucial competitive advantage and drive our ability to be a conviction buyer. We use our market-leading data to gain a greater level of insight, which is essential when the objective is to limit the downside and generate strong risk-adjusted returns.

As of 6/30/2024

Recent Content

Insights

Top Secondary Investment Trends with Keith Brittain

What's trending in the secondary market? Co-Head of Secondary Investments Keith Brittain answers questions that are top of mind for secondaries investors today.

Read the Research Article
News | 2 Min Read

Thompson Street Capital Partners Investment

Thompson Street Capital Partners announces the completion of a single-asset secondary market transaction co-led by Hamilton Lane.

Read the Press Release
News | 3 Min Read

Secondary Fund VI via Securitize

Hamilton Lane announced that qualified investors now have exclusive access to Hamilton Lane Secondary Fund VI through the Securitize platform.

Read the Press Release

We use cookies to improve user experience, and analyze web traffic. For those reasons, we may share your site usage with our analytics partners.

Learn More