The venture capital landscape has undergone a profound transformation over the past two decades, with one of the most significant shifts being the rise and institutionalization of the secondary market. At the forefront of this evolution stands Jared Carmel, co-founder of Manhattan Venture Partners (MVP), a firm that has dedicated more than a decade to building the robust infrastructure necessary for this critical component of the U.S. venture ecosystem. This development is not merely a financial innovation; it represents a fundamental re-calibration of how the industry funds, sustains, and ultimately supports the long-lived, high-growth American companies that are increasingly pivotal to the nation’s economic competitiveness and national security.
A Vision Forged in Market Turmoil: The Genesis of a Secondaries Pioneer
Jared Carmel’s entry into the professional world was marked by extraordinary market volatility, an experience that would profoundly shape his understanding of economic cycles and nascent opportunities. Graduating into the tail end of the dot-com bust in the early 2000s, mere weeks before the seismic events of September 11, 2001, Carmel witnessed firsthand the brutal consequences of irrational exuberance and subsequent market contraction. This challenging period, characterized by widespread job losses in the tech sector and a significant retraction of venture capital, imparted a crucial, albeit painful, lesson: markets are cyclical, and patterns, though often overlooked, inevitably repeat. He observed how sectors once dismissed, from telecom infrastructure to clean technology and even Special Purpose Acquisition Companies (SPACs), eventually re-emerged years later, often with renewed vigor and clearer value propositions. This early exposure to market ebb and flow instilled in him a unique foresight, an ability to "read the tape" of underlying trends before they became mainstream.
A pivotal moment arrived in late 2009, a period that, in retrospect, marked the nascent stages of a new era for private technology companies. A friend, then an early employee at Facebook, was preparing for a wedding and a departure from the company, seeking to monetize a portion of his hard-earned equity. Carmel seized the opportunity, acquiring these shares at a modest valuation of a few dollars apiece. While he readily admits to no longer holding those specific shares, the transaction itself proved transformative. It was a singular event that illuminated a profound, unmet need within the burgeoning private technology ecosystem: the desperate lack of liquidity for early employees and investors in high-growth companies that were opting to remain private for extended periods. As Carmel vividly recalls, "This was before the secondary markets were even a market. Before people knew it existed."
This initial transaction sparked a journey. Carmel began actively facilitating liquidity for other early employees and investors at then-private tech giants such as Facebook, Twitter, and Palantir. This informal brokerage of private shares eventually led him to G Squared, a prominent growth equity firm. However, the true inflection point in his career arrived in 2014 when he co-founded Manhattan Venture Partners. The firm was built upon a deeply held conviction that has since become a cornerstone of the modern venture capital industry: the secondaries market, traditionally viewed as an esoteric, opportunistic niche, needed to be professionalized and institutionalized. This meant applying the same rigorous diligence, financial discipline, and robust underwriting standards that characterized established primary venture firms, thereby elevating secondaries to a legitimate and integral component of the capital formation process.
The Evolving Venture Landscape: Longer Journeys and Flexible Capital Stacks
The American venture industry has, over the past decade, quietly yet fundamentally restructured itself to accommodate a new reality: the companies founders are now building are inherently more complex, ambitious, and consequently, require significantly longer periods to mature. It is no longer uncommon to find some of the largest, most valuable private companies in their second decade of existence as privately held entities. Data from various industry sources, including PitchBook and NVCA reports, consistently shows that the average time to IPO for venture-backed companies has steadily increased, often stretching from the traditional 5-7 years in the early 2000s to well over 10-12 years today.
Jared Carmel’s perspective on this extended gestation period challenges conventional wisdom. He firmly asserts that this trend is not an indicator of distress or a sign of an ailing market. Rather, it signifies a healthy, dynamic ecosystem where founders are tackling more challenging, foundational problems. Furthermore, it demonstrates the industry’s remarkable adaptability in providing the necessary support. "The IPO window is not closed because the markets are bad. The markets are great," Carmel contends. "It is closed because companies don’t need to go public to keep building."
This observation is supported by several factors. Firstly, the sheer volume of private capital available today is unprecedented, with growth equity firms, corporate venture arms, and sovereign wealth funds increasingly participating in late-stage rounds. Secondly, the regulatory burdens and scrutiny associated with being a public company, particularly for younger, still-evolving enterprises, can be substantial, diverting management’s focus from innovation to compliance. Lastly, remaining private allows founders and management teams to maintain greater control over their long-term vision, insulated from the short-term pressures of quarterly earnings reports and public market sentiment.
In response to these dynamics, a more sophisticated and flexible capital stack has emerged. This multi-faceted approach integrates traditional primary venture capital with growth equity, specialized venture debt, and, crucially, robust secondary markets. This diverse base of late-stage investors collectively provides the patient, long-horizon capital that twenty-year journeys demand. The increasing prevalence of secondary capital within IPOs themselves – where existing investors or employees sell shares as part of the public listing – serves as a quiet yet powerful indicator of how much the public listing event itself has evolved, no longer solely a primary capital raise but often a significant liquidity event for early stakeholders.
The Indispensable Role of Secondaries in the Innovation Economy
For a considerable period, the secondaries market was relegated to a niche, 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 transcend this limited perception to become a central pillar of the venture industry’s ability to foster American innovation. That conviction has, unequivocally, aged well. "Secondaries are not just supporting the venture ecosystem. They are becoming a key pillar of venture ecosystem," Carmel emphasizes, a statement now widely accepted by leading market participants.
The rationale underpinning this transformation is straightforward and compelling. When a company is genuinely committed to building for the long term, every additional year of private runway translates into another year of compounding capability, allowing for deeper product development, market penetration, and strategic maneuvering without the distractions of public market demands. A robust and efficient secondary market grants these companies invaluable time. It enables early employees, who might have joined years ago with significant equity compensation, to realize liquidity and manage their personal finances without compelling the company into a premature public offering before its business model, market presence, or internal infrastructure is truly ready for the intense scrutiny of public markets.
Furthermore, a healthy secondary market plays a vital role in maintaining the integrity and attractiveness of cap tables. It allows early investors, who may have held their positions for a decade or more, to achieve an exit, freeing up capital for new investments and ensuring a virtuous cycle of venture funding. Simultaneously, it provides an avenue for new, long-horizon investors to enter these mature private companies, bringing fresh capital and renewed conviction precisely when a company might most need reinforcement for its next phase of growth. This dynamic allows founders to continue building toward the kind of category-defining outcomes that have long been the hallmark of the U.S. venture industry, securing long-term value creation rather than being forced into suboptimal, early exits.
Supporting the Companies America Needs: A Strategic Imperative
Beyond the financial mechanics, a deeper and more profound question underpins the importance of these long-horizon companies: what precisely are they building? Jared Carmel’s answer zeroes in on the critical sectors where MVP primarily focuses its investment activities: artificial intelligence (AI), defense, space, supply chain, and frontier compute. These are not merely industries; they represent strategic national priorities. The dynamics observed in these sectors — the need for deep capital, specialized technical talent, and an unwavering willingness to plan in decades rather than quarters — are increasingly applicable across a broader spectrum of industries deemed vital for national security and economic competitiveness.
Carmel traces his personal conviction on this matter directly back to the supply-chain shock triggered by the COVID-19 pandemic in 2020. The crisis laid bare a jarring reality: the United States found itself unable to reliably source essential medications, N95 masks, and other critical goods, exposing a dangerous over-reliance on foreign manufacturing for strategic capabilities. This experience crystallized a trend he had been observing for years: the quiet outsourcing of strategic capabilities that the country could simply not afford to be without. The companies now being built to address and rebuild this critical capacity share a common profile. They are characterized by their intensive capital requirements, the need for highly specialized technical talent pools, and an organizational culture willing to commit to extremely long-term strategic planning. "The companies are going to need to build longer because they have more to build," Carmel explains, highlighting the inherent complexity and foundational nature of these undertakings.
This last requirement—the willingness to plan in decades—is perhaps the most significant adaptation the venture industry has had to embrace. Showing up for these founders extends far beyond merely writing a check. It necessitates a commitment to remaining a steadfast partner throughout the long, often arduous, middle phase of a company’s journey, a period when the work is hardest, external validation may be scarce, and patience is paramount. For Carmel, this commitment translates into tangible support: facilitating introductions to seasoned board members with deep expertise in critical sectors like defense and national security, connecting founders with experienced operating leaders capable of scaling a rapidly growing enterprise, and, fundamentally, a willingness to stay invested through the challenging stretches, providing unwavering support when it is most needed. "Being helpful isn’t pushing a transaction. It’s being the person the founder calls before they decide whether they need one," he articulates, underscoring the trust-based, advisory role MVP seeks to cultivate.
Optimism for the Future of American Innovation
When asked what sustains his drive and optimism in this demanding field, Jared Carmel offers a two-fold response. The first is deeply personal: he still finds it profoundly remarkable that his career allows him the privilege of diving deep into a dozen or so companies each year, learning directly from the visionary individuals who are building the future. This intellectual curiosity and engagement with groundbreaking innovation are powerful motivators.
The second answer, however, transcends the personal and speaks to a broader, more national conviction. "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. This assertion encapsulates the enduring case for the U.S. venture industry, articulated by someone who has navigated its cycles through several booms and resets. The companies that American founders are conceiving and developing today are, by and large, more ambitious, more capital-intensive, and demand a longer horizon than those of a generation ago. The venture industry, through the evolution of its capital structures and the institutionalization of markets like secondaries, has demonstrated a remarkable capacity to adapt and provide the tailored support these ventures require. Ensuring that capital continues to flow effectively and efficiently to these companies through every stage of their protracted, impactful journeys is not merely a financial endeavor; it is a strategic imperative for maintaining America’s leadership in innovation and its competitive edge on the global stage.
Manhattan Venture Partners, through its pioneering work in institutionalizing the secondary market, exemplifies this adaptive spirit. Their commitment to disciplined investing and long-term partnership ensures that critical innovation, particularly in strategic sectors, receives the patient capital and robust support necessary to flourish. As the U.S. continues to navigate an increasingly complex global landscape, the role of firms like MVP in nurturing these foundational companies will only grow in importance, securing a vibrant and resilient future for American innovation.
