Navigating the venture primary and secondary markets with an institutional approach
Are you a(n)...
Venture Fund looking to fill your pro-rata primary allocation?
Early employee at a successful start-up?
Family office looking to add to or reduce an early seed investment?
VC that is raising a new fund and would like to return some capital ahead of the new raise?
Friends & Family round investor looking to recycle capital into other investments?
RIA or Boutique asset manager with a client who has a concentrated position in a private, venture-backed company
Ex-employee facing a decision to exercise or let your options expire?
We provide a wide range of Venture Capital and Family Office Advisory products
Growth/Late Stage Secondary Trading
Through our network of family offices, UHNW investors, boutique asset managers and venture capitalists, we match buyers and sellers of growth and late-stage companies. We focus on venture-backed companies funded through at least Series B+ with valuations >$300mm.
Financing Solutions for Pre-IPO Shares
Investors wishing to use their growth and late-stage holdings as collateral can take advantage of a special non-recourse loan structure against vested stock or employee stock options. Interest is payable on the back end after going public. It allows the shareholder to retain the equity interest and voting rights while bridging the time to IPO or option expiry
Limited Partner Interest Sales
We facilitate the purchase and sale of venture capital limited partner portfolio interests through our deep secondary fund and limited partner relationships.
Early Stage Advisory
We work closlely with start-ups to hone their story, pitch and presentation. We also utilize our network for key hires, fundraising and strategic partnerships. Our advisory role can be as involved as needed and we strive to have it compliment the existing management team and earlier investors.
We can assist in capital raising through our network.
Growth & Late Stage companies
VC Funds (we also participate in helping VCs fill their pro-rata allocation)
Consolidation of Cap Table
VC backed start-ups can face conflict between what is in the best interest of the company versus investor demands and liquidity timelines. By consolidating parties growing impatient, we have access to largeer investors to purchase grouped positions. In addition to having a fresh strategic partner, in some cases they also look to particvipate in any future primary rounds..
Helpful Hints for Sellers & Buyers
The brokers you work with should have direct connections with both buyers and sellers. When multiple intermediaries (>2) are involved in a transaction, it's important to acknowledge that the likelihood of a successful deal diminishes significantly.
Avoid signing exclusive selling agreements - it further limits access to an already fragmented market. Work with brokers on a success-based fee basis that can canvas the maretplace to find a match
Educate yourself on the company's transfer procedure, blackout windows and exercise requirements.
Have realistic expectations of valuations - for example, valuations that previously were in a 12-14x revenue multiple, may now be trading at 6-8x.
Consult a tax and legal advisor
If selling a smaller lot (<$250k), consider aggregating with some fellow shareholders. Larger investors will look to acquire a minimum of $1mm.
Have a range on pricing expectations - incorporating size, class of stock, scarcity
If providing a deep discount bid, keep in mind ROFR risk and have a rational (pricing model, etc) to support your valuation analysis
Do not blanket the market looking for stock - it can give the impression of multiple buyers and unknowingly move pricing higher
If buying preferred stock, understand the shareholder rights, waterfall analysis and the cap table structure
Consider hiring outside counsel for complex transactions
A thoughtful ask to the company (potentially through one of the preferred shareholder in our network) can occasionally produce access to financials under NDA
If you also are interested in access to company's primary offerings, consider taking a position through the secondary market to gain closer access to company management
Bombora Advisory is an investment management and advisory firm focused on the VC-backed growth and late-stage markets and is based in Princeton, New Jersey. We work with other venture funds, employees, ex-employees, family offices and institutional investors to provide solutions for private securities. We leverage our network to directly facilitate transactions and provide education and transparency throughout the process.
Mark Caccavo founded Bombora Advisory in 2017 with a focus on investments and analysis for family offices and UNHW investors. He has a deep background across the capital markets at buy-side hedge funds and has held senior positions at Santander, Natixis and U.S. Trust in equity derivatives, structured products, investment banking, trading and M&A.