I bought into a company I’d missed, three years before it went public
A secondary marketplace was the only door left into a name everyone already knew.
Individual investor buying, first secondary purchase
Illustrative composite. A representative scenario built from how angel secondaries commonly play out — realistic numbers, written in the first person, not the record of a specific named person or company.
Deal snapshot
- Side
- Buying
- Sector
- Enterprise software
- Stage at purchase
- Late (pre-IPO)
- Amount deployed
- $40,000
- Bought at
- 22% below last round
- Structure
- SPV via marketplace
- Held to
- IPO, ~3 years
The company had stopped taking my kind of money
By the time I’d have loved to invest, the company was raising $200M rounds from crossover funds. There is no seat at that table for a $40,000 individual check. The primary market was closed to me.
The secondary market wasn’t. Early employees and seed investors were looking to sell, and marketplaces exist specifically to connect that supply with buyers like me.
What I actually bought
I didn’t buy shares directly. I bought a unit in a special-purpose vehicle (SPV) that held the shares — which is how most marketplace secondaries are structured for individual buyers. I got economic exposure to the company at about a 22% discount to its last round, minus the platform’s fees and carry.
Those fees are the catch. Read them closely: a management fee, sometimes carry on the upside, and a spread baked into the price. My “22% discount” was smaller in practice once all of that was accounted for. It was still worth it to me, but I went in with my eyes open.
What I gave up
Information. As an SPV holder buying secondary, I got almost none of the rights a primary investor gets — no financials, no board updates, no pro rata. I was buying a name, a discount, and a thesis, and trusting that the last round’s price was roughly fair.
It worked out: the company IPO’d about three years later above my entry, and the SPV distributed once shares were liquid. But it worked out because the company did well, not because I had any special insight or protection. On the buy side, the discount is your only real margin of safety — so the entry price is the whole game.
What to take from this
- Marketplace secondaries usually come as an SPV unit, not shares held directly.
- Model the real cost: management fee, carry, and price spread eat into the headline discount.
- You get little to no information as a secondary buyer — the entry price is your main protection.
Every angel who has held a position long enough eventually faces a version of this decision. For the mechanics behind stories like this one, see the guide to how secondaries work.