In an era defined by rapidly evolving technological landscapes and increasingly complex entrepreneurial journeys, the venture capital industry has undergone a profound transformation, none more significant than the rise of the secondary market as a pivotal component of its funding and support infrastructure. At the forefront of this evolution stands Jared Carmel, co-founder of Manhattan Venture Partners (MVP), a firm that has dedicated over a decade to institutionalizing this critical segment. His insights, born from a career spanning market cycles and paradigm shifts, underscore a fundamental realignment in how American innovation is financed, emphasizing the necessity of patient, long-horizon capital for companies tackling some of the nation’s most pressing challenges.
The Genesis of a Vision: Reading the Market Tape Before the Crowd
Jared Carmel’s entry into the professional world was marked by an exceptionally challenging economic climate. Graduating at the tail end of the dot-com bust, mere weeks before the seismic events of September 11, 2001, provided him with an immediate, albeit harsh, education in market volatility and the cyclical nature of economic trends. This period instilled a foundational understanding of what not to do, but more profoundly, it etched an awareness that market patterns repeat themselves. What is written off today—be it SPACs, telecom infrastructure, or clean tech—often re-emerges years later, reshaped and revalued. This early exposure to market ebb and flow honed a perceptive ability to discern nascent trends, a skill that would prove instrumental in his career.
The turning point, a moment of serendipitous insight, arrived in late 2009. A friend, an early employee at Facebook, was preparing for a wedding and a departure from the company, seeking to monetize some of his vested shares. Carmel seized the opportunity, acquiring these shares at what now seems an incredibly modest price—a few dollars apiece. While he readily admits to no longer owning them, often laughing about the missed exponential gains, the transaction itself was revelatory. It was, as he recounts, "before the secondary markets were even a market. Before people knew it existed." This informal exchange of private company shares, largely unheard of and certainly not institutionalized, illuminated a vast, untapped need for liquidity within the burgeoning private technology ecosystem.
From this pivotal experience, Carmel began carving out a niche, providing much-needed liquidity to early employees and investors at nascent giants like Facebook, Twitter, and Palantir. This informal brokerage of private shares laid the groundwork for what would become a formalized industry. His journey led him to G Squared, a prominent growth equity firm, before he co-founded Manhattan Venture Partners in 2014. The driving conviction behind MVP, one that has since gained widespread acceptance across the venture landscape, was that the secondary market could no longer remain an opaque, ad-hoc corner of finance. It demanded institutionalization, built upon the same rigorous diligence, discipline, and underwriting standards that characterized established primary venture firms. This foresight positioned MVP as a pioneer, anticipating a structural shift that would redefine venture capital.
Institutionalizing the Untamed Frontier: Bringing Rigor to Secondaries
The initial secondary market was largely characterized by informal transactions, often driven by personal networks and limited information. As venture-backed companies began to stay private longer, the need for a more structured, transparent, and efficient mechanism for share transfer became increasingly apparent. MVP’s founding thesis was precisely this: to transform a fragmented, often opaque market into a robust, institutionalized pillar of the venture ecosystem. This meant applying traditional financial rigor—comprehensive due diligence, meticulous legal frameworks, and disciplined valuation methodologies—to the trading of private company equity.
The evolution of the secondary market is closely tied to broader shifts in the venture capital landscape. Historically, the path for successful startups typically led to an initial public offering (IPO) within 5-7 years. However, by the late 2000s and early 2010s, factors such as increased private capital availability, reduced regulatory burdens for private companies (compared to public ones), and a desire by founders to maintain control and strategic flexibility led to companies deferring IPOs for longer periods. The average age of a company at IPO in the U.S. has steadily climbed from approximately 7 years in the late 1990s to over 11 years in the 2010s, and it continues to trend upward. This extended private runway created a liquidity crunch for early investors and employees, who often held significant value in illiquid shares for well over a decade.
This burgeoning demand for liquidity, coupled with an increasing sophistication among institutional investors seeking access to high-growth private assets, fueled the growth of dedicated secondary market participants. MVP’s strategy was not merely to participate but to lead in defining best practices. By focusing on stringent underwriting and a deep understanding of the underlying companies, MVP aimed to elevate the perception of secondaries from a niche, opportunistic play to a strategic capital solution. This commitment to institutional standards has been critical in attracting a wider base of sophisticated investors, further legitimizing the market. The volume of secondary transactions has mirrored this growth, evolving from a marginal few billion dollars annually in the early 2010s to a multi-billion dollar market today, with estimates often placing annual transaction volumes in the tens of billions of dollars globally.
The Evolving Landscape of Venture Capital: Longer Journeys, Deeper Pockets
The American venture industry has, over the past decade, quietly but fundamentally reconfigured itself to align with a new reality: the companies founders are building today inherently require longer maturation periods. It is no longer uncommon to find some of the largest, most impactful private companies operating as private entities for upwards of two decades. This phenomenon, Carmel asserts, should not be misconstrued as a symptom of distress or a failure of the capital markets. On the contrary, it is a testament to the ambition of founders tackling more complex, foundational challenges, and the venture industry’s adaptive capacity to support these arduous, extended endeavors.
Carmel challenges the prevailing narrative that a "closed IPO window" signifies market weakness. "The IPO window is not closed because the markets are bad. The markets are great," he contends. Instead, the current environment reflects a profound structural shift: companies simply do not need to go public as early as they once did to continue their growth trajectories. The private markets now offer a robust, flexible, and patient capital ecosystem that can sustain companies through multiple stages of development without the immediate pressures and public scrutiny associated with a listing.
What has emerged in place of a singular, expedited IPO path is a far more sophisticated and flexible capital stack. This includes a diverse array of funding sources: primary venture capital for early stages, growth equity for scaling, various forms of debt financing, and crucially, a highly evolved secondary market. Together, these mechanisms provide the patient, long-horizon capital essential for companies whose journeys span twenty years or more. This expanded toolkit allows founders to maintain greater control, focus on long-term value creation rather than quarterly earnings, and execute their visions without premature market pressures. Furthermore, a quiet but significant indicator of this evolution is the increasing presence of secondary capital within IPOs themselves, where existing shareholders can sell a portion of their holdings as part of the listing event, demonstrating how even the public offering has adapted to accommodate the long-term private journey.
Secondaries as a Strategic Imperative for the Innovation Economy
For many years, the secondary market was relegated to a somewhat obscure, niche corner of the venture landscape, often viewed with skepticism or as a last resort for distressed assets. Jared Carmel was among the earliest and most vocal proponents arguing that secondaries would not only grow but would become an indispensable, central pillar of the venture industry’s ability to foster American innovation. His conviction has been thoroughly validated by market trends and the strategic importance that secondaries now command.
"Secondaries are not just supporting the venture ecosystem. They are becoming a key pillar of the venture ecosystem," Carmel emphasizes. The rationale behind this elevation is remarkably straightforward and profoundly impactful: for companies genuinely committed to building for the long term, every additional year spent privately compounds their capabilities, allowing for deeper product development, market penetration, and strategic refinement. A robust secondary market grants these companies the invaluable gift of time. It enables early employees, who often defer significant compensation for equity, and early investors, who take substantial risks, to realize liquidity from their holdings without compelling the company into a public offering before its business model, market presence, or internal infrastructure is truly ready for public scrutiny.
This capability to provide staggered liquidity is vital for several reasons. It helps maintain healthy capitalization tables by allowing legacy shareholders to exit, making room for new, long-horizon investors who can inject fresh capital and conviction precisely when a company needs reinforcement. This dynamic ensures that companies retain access to capital and talent, avoiding the stagnation that can occur when early stakeholders are locked into illiquid assets indefinitely. Ultimately, the ability of secondaries to facilitate orderly transitions and continuous capital infusion empowers founders to steadfastly build toward the kind of category-defining outcomes that the U.S. venture industry has historically championed, fostering an environment where truly disruptive, long-term visions can come to fruition.
Fueling America’s Future: Investment in Critical Sectors
Beyond the mechanics of capital, a deeper question for any observer of the venture industry revolves around the nature of the companies that are undertaking these extended, demanding journeys. Carmel’s answer points directly to the critical sectors where MVP primarily focuses its investment efforts: artificial intelligence, defense technology, space exploration, supply chain resilience, and frontier compute. These are not merely high-growth areas; they represent foundational pillars of national security, economic competitiveness, and societal advancement.
These companies, by their very nature, are not three-year sprints, nor are they even ten-year projects. They are twenty-year endeavors, characterized by profound technical complexity, significant capital requirements, and often, a direct bearing on national strategic interests. "The companies are going to need to build longer because they have more to build," Carmel explains, underscoring the inherent scope and ambition of these ventures.
Carmel traces his personal conviction regarding these sectors back to the stark realities exposed by the COVID-19 pandemic, particularly the severe supply-chain shocks. The inability of the United States to reliably source essential medications or even basic N95 masks crystallized a trend he had observed for years: the quiet outsourcing of strategic capabilities that the nation could not afford to be without. The companies now emerging to rebuild and fortify this critical infrastructure share a common profile. They demand not only deep pools of capital and exceptional technical talent but also a willingness to plan in decades rather than mere quarters. These are businesses where impact is measured not just in market share but in national resilience and strategic advantage.
This last requirement—the willingness to commit to a multi-decade horizon—is precisely what the venture industry has had to cultivate and embrace. For firms like MVP, truly showing up for these founders extends far beyond simply writing a check. It entails a sustained, unwavering partnership throughout the arduous, often unglamorous, middle stages of a company’s journey, when the work is hardest, breakthroughs are incremental, and external validation may still be years away. This commitment to enduring partnership defines the modern, institutionalized approach to venture capital, especially in strategically vital sectors.
Beyond Capital: The Role of a Long-Term Partner
The contemporary venture capital landscape demands a more profound engagement than simply providing financial resources. For Jared Carmel and Manhattan Venture Partners, being a truly helpful partner transcends transactional interactions. It signifies a deeper, more enduring commitment to a founder’s vision and the company’s long-term success. "Being helpful isn’t pushing a transaction. It’s being the person the founder calls before they decide whether they need one," Carmel articulates, encapsulating MVP’s philosophy of proactive, relationship-driven support.
This means MVP’s involvement often extends to facilitating critical board introductions, connecting founders with seasoned operating leaders who possess the specific expertise required to scale complex organizations, particularly in highly specialized fields like defense or advanced computing. It involves a willingness to remain deeply invested through the prolonged "middle" of a company’s journey—a period that can be characterized by intense development, market education, and operational challenges, far removed from the immediate gratification of early milestones or late-stage valuations. During this phase, when the work is hardest and external validation may seem distant, the steady hand and strategic guidance of a committed partner like MVP become invaluable.
This holistic approach to partnership is particularly crucial for the long-horizon companies in critical sectors. Building an AI-driven defense solution or a next-generation space technology requires not just capital, but access to networks, strategic insights into regulatory landscapes, and mentorship in navigating complex engineering and market challenges. MVP’s model reflects an understanding that fostering American innovation, especially in areas with national implications, requires a venture partner capable of providing intellectual capital, operational support, and unwavering conviction alongside financial backing. This ethos is central to MVP’s identity and its contribution to the broader innovation ecosystem.
An Optimistic Outlook on American Innovation
When asked about the driving force behind his sustained dedication to the venture industry, Jared Carmel offers a two-fold response, beginning with a personal reflection. He still finds it profoundly remarkable that his career affords him the opportunity to delve deeply into a dozen or more companies each year, learning directly from the visionary individuals who are building the future. This intellectual curiosity and connection to innovation fuel his daily work.
The second, broader answer centers on the United States itself. "Technology is being built by more people than at any other moment in my career. Our job is to keep capital flowing in a way that matches that reality," Carmel states with clear optimism. This encapsulates the compelling case for the enduring strength and adaptability of the U.S. venture industry, articulated by someone who has navigated multiple market booms, busts, and resets. The current generation of American founders is tackling challenges that are often more ambitious, more capital-intensive, and inherently longer-horizon than those of previous generations. The venture ecosystem, spearheaded by firms like MVP and the institutionalization of the secondary market, has demonstrably adapted to meet these evolving demands.
The continuous flow of capital, thoughtfully directed and patiently deployed across every stage of these companies’ journeys, is the indispensable work that underpins American innovation and global competitiveness. The evolution of the secondary market, from an informal afterthought to a sophisticated, institutionalized pillar, is a testament to the industry’s capacity for self-correction and strategic adaptation. It ensures that the audacious visions of today’s founders, particularly those building in critical sectors, receive the sustained support necessary to mature into the category-defining, nation-strengthening enterprises of tomorrow. This resilient and evolving ecosystem, anchored by forward-thinking firms like Manhattan Venture Partners, stands ready to propel the next wave of American ingenuity.
