The Discount Is the Wrong Question in PE Secondaries

Richard Chow, Partner at PJT Partners (NYSE: PJT)

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Private market investors eventually run into the same problem: the asset may still be attractive, but the original path to liquidity no longer works. IPO windows close. M&A markets stall. Fund lives run out. LP priorities change. Secondaries give investors another way to create liquidity, but evaluating those transactions takes more than comparing a purchase price to the latest GP mark.

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The biggest trap is treating the discount as the answer. A lower price can look attractive while hiding the questions that actually decide whether the deal is any good, and most buyers never get past price to ask them.

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Richard Chow, a Partner at PJT Partners (NYSE: PJT), who has worked every side of the secondary market, as an LP, a portfolio manager, and now an advisor, walks through what those questions actually are and how to use them before you're on the wrong side of a deal.

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What You'll Learn

Why the headline discount is often the wrong starting point
The five questions that actually price a secondary
LP interests vs. GP-led continuation vehicles vs. direct secondaries
Why day-one IRR on a discount is misleading
Why nobody quotes real secondary market volume
How to diligence a cap table with multiple investor vintages
The most common mistake buyers make evaluating a secondary

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The best deal decisions rarely come down to one number. DealPilot's Buyer-Led M&A™ Certification gives you a stronger framework for evaluating risk, value, and tradeoffs.

Richard Chow

Richard Chow is a Partner in the PJT Park Hill Private Capital Solutions Group at PJT Partners (NYSE: PJT). He began his career in M&A at Salomon Brothers before moving into private-market investing and secondaries. Prior to joining PJT Partners, Chow spent five years at Paul Capital and more than four years at Abu Dhabi Investment Authority, where he managed its secondaries investment team. He later served as Managing Director at Quantum GBL, investing in U.S. alternative assets. Chow holds both an MBA and a BS in Economics from the Wharton School of the University of Pennsylvania.