E31: Unlocking the Secrets of Startup Secondaries with Jamie Melzer

Our guest this week is Jamie Melzer, Managing Partner at Altra Venture Partners. Altra invests in late-stage and pre-IPO venture-backed startups via secondaries. Jamie took us on a behind-the-scenes tour of the secondary market, how it works, why it is relevant to early stage investors and founders, and where the market is heading. This was the first time we’ve talked about secondaries on Investing in Startups but it probably won’t be the last because it is becoming more important as startups stay private for longer. Please enjoy.

We also covered:

• The nuts and bolts of a secondary deal—finding a seller, agreeing on price with scant data, and getting past ROFRs or outright company blocks that kill roughly a third of transactions.

• Why the late-stage secondary market now looks like public-equity investing, with the top 10 U.S. unicorns (SpaceX, Stripe, OpenAI, etc.) representing more than a third of all private-tech value—a true power-law.

• Common shares trading at premiums to fresh preferred rounds, and how hidden liquidation stacks can wipe you out if you don’t model the waterfall.

• The surge of giant institutional funds and private-wealth vehicles buying $100-300 M blocks—versus retail SPVs chasing “Birkin-bag” names like Anduril or SpaceX, often at double the institutional price.

• Lessons Jamie brought from distressed credit: pricing risk, valuing businesses bottom-up, and why share-class selection matters as much as entry multiple.

• Rethinking portfolio construction: focus on position size and access, not “own 10 %,” and accept that 15-30 late-stage names can give better exposure than hundreds of seed bets.

• How evergreen, index-style funds could let employees and early VCs tap liquidity every 6-12 months while letting new investors hold compounders indefinitely.

• The coming “secondary-of-secondaries” wave, when today’s growth-stage and secondary funds will themselves need liquidity from even later buyers.

Investing in Startups is hosted by Joe Magyer and produced by Seaplane Ventures.