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Venture and secondary market trends

The market for direct secondaries is constantly evolving and is becoming increasingly attractive to private equity firms. Corporate venturing is also on the rise. Yet they are not without their pitfalls. Columbia Strategy discusses the rise of direct secondaries and corporate venturing and the potential obstacles that must be overcome.

There is a general consensus that the value of secondaries over the next five years could easily rise towards $20bn. But there are issues that could prevent its success and longevity. These include such factors as company valuations and discounts. Corporate venturing also faces a number of barriers, such as the increasing costs of setting up a venture programme and the need to focus on core assets in weak capital markets.

Copyright © 2003 Columbia Strategy

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Columbia Strategy takes a long-term approach as private equity portfolio management strategists - providing unbiased strategic advisory services to funds and institutions weighing major portfolio initiatives. For more information please visit www.columbiastrategy.com