Australian Investors Podcast How to invest in private equity halfway through the funds life
Nov 12, 2025
Eric Foran, a senior investment professional at Coller Capital with 15 years in private equity secondaries, shares insights on this unique market. He explains how investing halfway through a fund reduces risk and offers liquidity to early-exiting investors. With the secondary market exceeding $200 billion, Eric discusses the drivers of discounts and expected returns. He highlights how Coller strategically sizes transactions and the importance of relationships in sourcing deals, plus tips on portfolio allocation with secondaries.
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Bet Mid-Race To Reduce Blind-Pool Risk
- Secondary private equity buys existing fund interests years after initial commitments, removing blind-pool risk.
- Coller evaluates visible portfolio companies and prices expected cash flows to set purchase discounts.
Buy At A Discount; Price Cash Flows
- Expect to buy secondaries at a discount to reported fair value; discounts widen in stressed markets.
- Solve for returns by pricing underlying cash flows and demanding an appropriate margin to NAV.
Huge Growth Potential Remains
- Secondary volume has historically been 1–2% of private equity AUM, so current $200bn is still small relative to the primary market.
- If turnover rises a few percentage points, the secondary market could scale dramatically.