As India’s venture capital and private equity ecosystem matures, specialized secondary funds are emerging as vital connectors between investors seeking exits and those desiring longer exposure to high-quality assets. As fund cycles approach maturity, initial public offering (IPO) timelines face delays, and general partners (GPs) experience mounting distribution pressures, these funds are increasingly stepping in to provide both liquidity and continuity.
“Venture capital funds, growth funds, and private equity funds have all maintained their specific focus. But who’s building the bridges between them? That’s where secondaries come in,” stated Rohit Bhayana, Co-founder and Co-CEO of Oister Tribe, which has recently launched the ACE Fund—a $500 million vehicle focused on secondary transactions and continuation structures.
“Oister’s ACE Fund is designed precisely to fill this gap,” Bhayana noted, highlighting the initiative’s goal to create both continuation vehicles and dedicated secondary funds under ACE. This approach aims to facilitate liquidity solutions across venture capital (VC) and private equity portfolios. As a result, GPs gain flexibility for longer structures, limited partners (LPs) receive optionality regarding whether to remain invested or cash out, and founders benefit by having the opportunity to reconstruct their capitalization tables.
Globally, secondaries have transitioned into a mainstream asset class. Bhayana remarked that “secondary funds’ assets under management (AUM) have grown at a 20 percent compound annual growth rate (CAGR) over the last decade, compared to 12-13 percent for overall private equity funds.” He added that “over $580 billion has been raised worldwide in the secondaries asset class over the past 15 years,” with India poised for substantial growth in the next three to four years.
Valuations are also stabilizing, according to Bhayana. “Globally, secondaries are generally priced at a 10 percent discount to net asset value (NAV). However, if a company demonstrates strong revenue visibility and margin strength, there’s no reason it shouldn’t transact at a premium.”
Rahul Jain, President and Head of Nuvama Wealth, highlighted the increasing appetite for co-investment and selective stake purchases among high-net-worth clients. “We engage in co-investment opportunities for major clients alongside fund managers, specifically for specialized investors who understand the risks involved and can afford to invest,” he explained. “If I possess ₹100 of stock but wish to offload ₹2-3, that dynamic works well for everyone involved—the investor gains access, and the fund secures liquidity.”
Vinay Rao, Partner at Ventureast, noted that momentum is visible in both early and late-stage markets. “We are observing a significant uptick in secondary funds assessing portfolios for potential deals,” he remarked. Rao further explained that “liquidity pressure on funds nearing the end of their lifecycle and distribution to paid-in (DPI) requirements for GPs seeking to raise new funds are leading to a strong supply of secondary shares.”
He pointed out that more specialized secondary funds are emerging as India reaches an “inflection point,” particularly as over 800 late-stage tech companies are poised for IPOs. “We are also seeing the rise of opportunity funds—vehicles created by VCs to invest further in established winners within existing portfolios,” he said.
As funds age and investors demand faster liquidity, secondary transactions are expected to become an integral component of India’s private capital landscape. “The opportunity is substantial,” Bhayana concluded. “As funds mature and the necessity for delivering DPI increases, secondaries will serve as a defining pillar of India’s next phase in private market evolution.”
The article was published on October 24, 2025.
