The Pre-IPO Library
Every term, right, and piece of market slang in private secondaries — answer-first, jargon-decoded.
Pre-IPO markets run on specialized vocabulary. SPVs, ROFRs, cram-downs, paper marks — knowing the precise meaning of each term is the difference between understanding a deal and being on the wrong side of one. This library defines every relevant concept, with worked examples and the edges the pros know.
Structures & Vehicles
The legal wrappers and instruments used to hold, buy, or gain exposure to pre-IPO shares.
A buyer-to-seller transfer of actual shares in a private company, without an SPV intermediary.
An agreement to buy or sell a specified number of private shares at a fixed price on a future date or triggering event.
ISOs are tax-advantaged employee stock options; NSOs are broader but taxed as ordinary income on exercise.
A promise to grant shares upon vesting; RSUs at private companies typically also require a liquidity event to actually deliver shares.
A convertible instrument that gives the investor the right to receive equity in a future priced round, without accruing interest.
A fund structure dedicated to building a position in one private company across multiple closes or vintages.
A single-deal LLC or LP that pools multiple investors into one cap-table line to hold pre-IPO shares.
A company-organized process where selected shareholders are invited to sell shares at a fixed price within a limited window.
Short-term debt financing used by funds or dealers to acquire pre-IPO shares before syndicating them into an SPV.
Rights & Restrictions
Contractual provisions that control who can sell, when, and on what terms.
A company-imposed period during which employees and insiders are prohibited from trading shares, typically around earnings or material events.
A minority investor's right to join a majority shareholder's sale and sell their shares on the same terms.
A majority shareholder's right to force minority shareholders to join an approved sale of the company.
Contractual rights — typically for major investors — to receive regular financial statements and updates from a private company.
A post-IPO period — typically 90 to 180 days — during which insiders and pre-IPO investors are contractually barred from selling shares.
An investor's contractual right to maintain their ownership percentage by investing proportionally in future funding rounds.
A company's contractual right to match any third-party offer to buy a shareholder's shares before the transfer proceeds.
A minority investor's right to join a controlling shareholder's sale and exit on identical terms.
A contractual or legal limit on a shareholder's ability to sell, assign, or otherwise transfer private shares.
Pricing & Valuation
How private companies are priced, marked, and discounted in primary and secondary markets.
An IRS-required independent appraisal of a private company's common-share fair market value, used to set option strike prices.
A single weighted-blend valuation across independent, cross-verified signals — synthesized rather than copied from any one source.
A funding round priced lower than the company's previous round — signaling declining investor confidence or a market reset.
A funding round priced at the same per-share price as the previous round — often a sign of stalled growth or bridge financing.
The percentage gain from a company's IPO offer price to its first-day closing price — a measure of underpricing.
The company's total implied value immediately after a funding round closes, equal to pre-money valuation plus the new investment.
The valuation gap between a company's preferred shares (held by investors) and its common shares (held by employees).
The percentage below (discount) or above (premium) the last primary round price at which secondary shares trade.
A fund's internal per-share or total valuation estimate for a portfolio holding, used in NAV calculations and LP reporting.
Process & Players
The institutions, roles, and processes that make pre-IPO transactions happen.
A US legal standard designating individuals or entities permitted to participate in unregistered private securities offerings.
A large, marquee investor who commits early and publicly to a funding round or IPO, stabilizing the process and signaling to others.
A FINRA-registered firm operating a licensed marketplace where pre-IPO secondary shares are matched and transacted.
The definitive record of who owns what in a private company: shares, options, warrants, and convertible instruments.
A fund that invests in both private (pre-IPO) and public companies, typically leading large late-stage rounds as a bridge to listing.
A pitch event where accelerator cohort companies present to investors, often marking the start of their fundraising process.
A higher accreditation tier — individuals or entities with ≥$5M in investments — required for larger private fund vehicles.
A firm or bank appointed by a company to maintain the official cap table and process all share transfers.
Market Slang
The shorthand vocabulary insiders use — decoded with context and edge.
The fund manager's share of profits — typically 20% — taken after investors have received their capital back.
A small bridge round raised to simplify the cap table or satisfy obligations before a larger raise or exit.
A highly dilutive financing round that forces harsh terms on existing shareholders — typically common holders and non-participating investors.
Contractual provisions that adjust an investor's share price or count to protect them when a company raises at a lower valuation.
Capital that investors have committed to a fund but that the fund has not yet deployed — available for future investments.
An unrealized valuation gain on a private holding that exists only on paper and has not been tested by an actual sale.
A funding round with many small investors — typically angels — and no single lead investor taking ownership of the company's development.
A provision requiring existing investors to participate in a new round or lose their preferred-share protections.
A follow-on investment — or a refusal to invest — by an existing insider fund that signals their conviction (or lack of it) to the broader market.
A funding round with embedded protections (ratchets, full preference, guaranteed returns) that prop up the headline valuation at investors' expense.
A private company valued at $1B+ (unicorn) or $10B+ (decacorn) in its most recent primary round.
A company that retains its unicorn label but whose secondary market valuation has fallen significantly below $1B and has no clear path to liquidity.
Put the knowledge to work
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