Key Takeaways
- • Secondary market deal volume surpassed $120 billion in H1 2026, representing a 20% increase over the previous record set in H1 2025, driven primarily by continuation fund activity.
- • Single-asset continuation funds accounted for $34 billion of deal value, representing over half of GP-led transaction volume as sponsors extended ownership of high-conviction assets facing depressed traditional exit markets.
- • GP-led transactions comprised 54% of total secondary deal volume in H1 2026, a significant shift from prior years when LP-led deals dominated, reflecting sponsors' need to provide liquidity without forcing premature asset sales.
- • Continuation funds evolved from a niche strategy to the dominant form of GP-led deal activity, accounting for 86% of GP-led transactions by volume and becoming a core portfolio strategy across the secondary market.
- • Depressed M&A and IPO exit environments have created an industrywide asset pileup in aging funds, forcing general partners to utilize continuation vehicles as an alternative liquidity mechanism for limited partners.
Summary
The secondary market reached a record milestone in the first half of 2026, with total deal volume surpassing $120 billion—a 20% jump from the previous record achieved in H1 2025. According to Evercore, one of the most active intermediaries in the secondary market, continuation funds have emerged as the primary driver of this unprecedented activity.
Single-asset continuation funds represent the most significant component of this growth trajectory. These vehicles accounted for $34 billion of deal value in H1 2026, representing more than half of all GP-led secondary transaction volume. The concentration of capital in single-asset structures reflects a deliberate strategic shift among general partners seeking to extend ownership of their most valuable portfolio companies—described as "trophy" assets—while simultaneously generating distributions for their limited partners.
GP-led transactions broadly, which focus on one or a small number of companies, accounted for nearly 54% of total secondary deal volume in the period. This represents a notable reversal from historical patterns, when LP-led transactions—involving institutional investors selling stakes in private funds—dominated secondary market activity. The shift underscores fundamental changes in market dynamics and sponsor priorities.
The expanded use of continuation funds reflects structural pressures in the broader private capital environment. Depressed traditional M&A and IPO exit markets have created a significant pileup of assets stuck in aging funds nearing the end of their contractual life. Rather than forcing premature asset sales at unfavorable valuations, sponsors have increasingly turned to continuation vehicles as a mechanism to provide meaningful liquidity to investors while preserving ownership and upside participation in mature, high-performing businesses. Continuation funds now account for 86% of GP-led transactions by volume, cementing their position as the dominant instrument in secondary market activity. Major investment managers including Pantheon, ICG Strategic Equity, Carlyle AlpInvest, and Lexington Partners have launched dedicated funds focused on backing single-asset continuation vehicles, indicating institutional recognition of this strategy's scale and permanence within the alternative investment ecosystem.
Single-asset continuation funds represent the most significant component of this growth trajectory. These vehicles accounted for $34 billion of deal value in H1 2026, representing more than half of all GP-led secondary transaction volume. The concentration of capital in single-asset structures reflects a deliberate strategic shift among general partners seeking to extend ownership of their most valuable portfolio companies—described as "trophy" assets—while simultaneously generating distributions for their limited partners.
GP-led transactions broadly, which focus on one or a small number of companies, accounted for nearly 54% of total secondary deal volume in the period. This represents a notable reversal from historical patterns, when LP-led transactions—involving institutional investors selling stakes in private funds—dominated secondary market activity. The shift underscores fundamental changes in market dynamics and sponsor priorities.
The expanded use of continuation funds reflects structural pressures in the broader private capital environment. Depressed traditional M&A and IPO exit markets have created a significant pileup of assets stuck in aging funds nearing the end of their contractual life. Rather than forcing premature asset sales at unfavorable valuations, sponsors have increasingly turned to continuation vehicles as a mechanism to provide meaningful liquidity to investors while preserving ownership and upside participation in mature, high-performing businesses. Continuation funds now account for 86% of GP-led transactions by volume, cementing their position as the dominant instrument in secondary market activity. Major investment managers including Pantheon, ICG Strategic Equity, Carlyle AlpInvest, and Lexington Partners have launched dedicated funds focused on backing single-asset continuation vehicles, indicating institutional recognition of this strategy's scale and permanence within the alternative investment ecosystem.
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