LP-led secondary

Worked example

A worked example from the buyer's side (illustrative figures):

1. A secondary buyer purchases an LP stake with a current NAV of $10 million for $8.5 million — an 85% price-to-NAV.
2. Over the following four years, the fund's remaining portfolio matures and distributes a total of $12 million back to whoever holds that LP interest.
3. On an $8.5 million entry, receiving $12 million back over roughly four years works out to an internal rate of return in the high single digits to low double digits — a return the buyer earned purely from buying an existing, already-de-risked portfolio at a discount, without ever making a primary fund commitment.
4. This is the basic economic logic behind every dedicated LP-secondaries fund in the buyer & fund directory: discount-to-NAV entry plus a shorter, more visible path to distributions than a primary commitment made from scratch.