HACKER Q&A
📣 deloisa

Tips for navigating secondary sales of startup shares?


I'm sitting on ISOs that I exercised out-of-pocket. The company is doing well based on conversations with former colleagues but there's no clear timeline for an exit. I'm in a good spot financially, so I can be patient and selective, but I'm curious about the secondary market landscape and running into several questions:

1. Valuation: How do you reasonably price shares when you have limited insight into current metrics? The company is in the card issuing space so I have some examples to go off of (marqeta, stripe issuing, mercury, adyen, etc...)

2. ROFR: The company has standard right of first refusal terms. For those who've been through this, how did you handle it? I've heard about alternative structures like forward contracts and non-recourse loans - would appreciate any insights on what works.

3. Finding buyers: I've looked at the major platforms (EquityZen, EquityBee, Forge, Zanbato) but their fees seem steep and terms restrictive. Are there other channels worth exploring?

4. Paperwork/Process: My shares are held with standard custodians (Carta/Pulley). For those who've completed secondary sales, what unexpected challenges did you encounter? Any pitfalls to watch out for?

Would really appreciate hearing from others who've successfully navigated this! Thanks~~


  👤 toomuchtodo Accepted Answer ✓
Check Hiive and Nasdaq private markets. Only do a forward contract if you must have liquidity and have no other choice. If you’re seeking legal guidance, talk to https://news.ycombinator.com/user?id=grellas