Value Investing with Legends Richard Brekka - From Venture to Secondaries: Richard Brekka on Illiquid Market Advantages
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Nov 7, 2025 In this discussion, Richard Brekka, founder of Second Alpha and a veteran in venture and secondary investing, shares his journey from private equity to identifying opportunities in illiquid markets. He reveals how a box of stock certificates ignited his passion for secondary investments. Richard also discusses the sourcing of deals through AI data pipelines, the intricacies of deal structures, and the psychology of engaging CEOs. He provides insights on the implications of AI on market dynamics and touches on policy issues regarding private market access for 401(k) investors.
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Turning Gomez From Near-Death To Exit
- Richard took over Gomez during the dot-com crash and transformed it from a failing rating business into an observability leader.
- He grew revenues, shifted billing to annual in advance, hired a new CEO, and ultimately sold Gomez to Dynatrace for a successful exit.
Box Of Certificates Sparked Second Alpha
- A Bank of America analyst emailed a signed purchase agreement to sell a box of private stock certificates, and Second Alpha bought them quickly.
- That six-month secondary trade returned the same multiple as a nine-year primary investment and inspired Second Alpha's founding.
Illiquidity Creates Sizable Buying Edge
- The private secondary market concentrates liquidity in the largest unicorns and decacorns, while sub-$1B companies remain illiquid.
- That illiquidity creates an opportunity: specialized buyers can become the only available purchaser for smaller private tech shareholders.
