SIGNALCapital Markets·Jun 11, 2026, 5:00 AMSignal55Medium term

Continuation fund craze: who really wins when VCs sell to themselves?

Source: Sifted

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Continuation fund craze: who really wins when VCs sell to themselves?
Why this matters
Why now

The private markets are maturing and finding new ways to provide liquidity and manage portfolios, especially as traditional exits become more challenging.

Why it’s important

Continuation funds highlight an evolving landscape in venture capital, impacting valuations, investor returns, and the lifecycle of private companies.

What changes

The rise of continuation funds changes the dynamics of VC exits, potentially extending investment horizons and offering alternative liquidity paths for GPs and LPs.

Winners
  • · Savvy General Partners (GPs)
  • · Limited Partners (LPs) seeking liquidity
  • · Maturer private companies
  • · Specialized secondary market investors
Losers
  • · Limited Partners (LPs) caught off-guard
  • · Traditional M&A market
  • · Companies pushed into continuation funds rather than IPOs
Second-order effects
Direct

Increased prevalence of secondary transactions within private equity and venture capital.

Second

Potential for misalignment of interests between existing LPs, new investors, and GPs if transparency is lacking.

Third

Re-evaluation of traditional exit strategies and fund structures as the private market asset class grows and seeks deeper liquidity.

Editorial confidence: 85 / 100 · Structural impact: 40 / 100
Original report

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