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Case Study: Venture Secondary SPVs Skip the J-Curve: An Intro to Venture Capital Secondary

Case Study: Venture Secondary SPVs
(Q1/20): $5M secondary in 500 Startups Fund I (2010)
• Purchased $7M in LP interests @ 30-45% discounts (42% avg)
• 4 Unicorns: Talkdesk, Lucid, Intercom, Udemy (~80% of portfolio)
• Previous IPOs: Twilio (2016), SendGrid (2017), The RealReal (2019)
> 3x
Projected
net return
to LPs:
in 5 years
1X
2X
3X
4X
2021 2022 2023 2024 2025
est. 1x principal
returned in 2-3 yrs
1.5x immediate
markup (due to
discount)
0.47
0.45
0.54
0.87
1.27 3.60
1.0x invested capital
2020 Total
Source: PitchBook, July 2020
* Undisclosed.
Company Val Latest Funding Round, Lead Investors
$3B Q3 / 20 $143M Series C, Franklin Templeton
$1.0B Q2 / 20 $52M Series D, ICONIQ, Spectrum, Meritech
$1.2B Q2 / 18 $125M Series D, Kleiner Perkins
$2.0B Q1 / 20 $50M Series E, Benesse Holdings, IVP
$300M * Q1 / 20 [ Undisclosed ]
$300M * Q3 / 20 [ Undisclosed ]
** Q2 / 20 $251 Series C Itochu, Visa, Soros, PayPal
[ other ] - Notable: Smule, Flywire, KiwiCo, Conekta
5-Year Projected Distributions and Returns
2.2x gross
after Q2
FMV Realized Returns
Unicorns
Non-Unicorns

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