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| (Jenna O'Malley/PitchBook News) |
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As tech startup valuations continue to climb, venture funds focused on filling out pro rata allocations are emerging from obscurity.
These funds offer a way for smaller VCs to hold on to investment allocations in high-growth startups without the necessary capital—an especially attractive recourse for emerging managers, who continue to face a tough fundraising market.
In exchange for helping a seed-stage VC fill out its allocation in a portfolio company's later funding rounds, these specialist firms get access to some of the most sought-after startups.
There are only a handful of firms in this category, such as SaaS Ventures and SignalRank. They represent an alternative take on startup secondaries, which are also booming amid liquidity needs and soaring valuations.
"We've observed that the venture ecosystem is moving from seed, more traditional VC and growth [equity] to just seed and growth," said Rob Hodgkinson, managing director at SignalRank. "So, you're having more and more growth funds come in earlier than before, and this means the seed and pre-seed funds are getting squeezed, and the dilution is happening earlier."
I'm Michael Bodley, and this is The Weekend Pitch. You can reach me at michael.bodley@pitchbook.com or on X @michael_bodley. |
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| A message from Fidelity Private Shares |
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| So someone told you to get a 409a...now what? |
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You probably weren’t planning to get a 409A valuation—someone likely told you to get one. Maybe it was your lawyer, investor, or founder friend. This guide breaks down what a 409A valuation is, why it matters, and how to make sure you’re not taking a risky shortcut.
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| (J. David Ake/Getty Images) |
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The US government shutdown is set to enter its fourth week with no end in sight and is now the second-longest in the nation's history. How long did the longest shutdown last?
A) 14 days
B) 28 days
C) 22 days
D) 35 days
Find your answer at the bottom of The Weekend Pitch! |
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VC secondaries grow; GP-led deals lag
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Annual GP-led VC secondaries have reached around $14.6 billion and are projected to grow by $1.5 billion in the next two years, according to our recent analyst note, with continuation vehicles driving much of the growth.
Direct secondaries, meanwhile, are hovering around $60 billion in annual transactions, up from $50 billion last year.
Much of the activity in the US venture secondaries market has revolved around direct deals. They're cheaper and require less due diligence from the buyer, while so-called strip portfolio sales have proven to be a tougher sell. Still, portfolios that include stakes in some of the top AI startups could garner better interest. |
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Stablecoins' rise meets friction
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| (Adriana Hansen/PitchBook News) |
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As stablecoins rapidly become indispensable to traditional financial institutions, their limitations are also becoming more difficult to ignore, according to our analyst note.
To deliver on the technology's promise of minimal-cost transactions, stablecoins will likely need more liquidity and lower currency conversion costs to gain market share.
The market capitalization of all stablecoins grew more than 66% year-over-year to nearly $290 billion as of Oct. 1, according to the research. And adjusted annual transaction volume reached more than $7.2 trillion—more than half of Visa's annual payments processed. |
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"There is more to be gained through discussion and engagement than there is via guerrilla warfare."
—New York State Sen. Andrew Gounardes, co-author of the AI safety bill, the RAISE Act, addressing the VC community during a Q&A with PitchBook's Jacob Robbins, in which Gounardes discussed his battle against the bill's opponents. The law was passed four months ago, but hasn’t been signed by Gov. Kathy Hochul. |
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Keep an eye out for these insights and research reports coming out this week:
- Q3 2025 Enterprise Fintech VC Trends
- Analyst Note: The Trillion-Dollar Capital Frontier: Sovereign AI
- Q3 2025 Global M&A Report
- Analyst Note: Takeaways From HLTH USA 2025
- Q3 2025 Clean Energy VC Trends
- Analyst Note: Seed Under Pressure
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Answer: D.
Starting in December of 2018 and lasting until January of 2019, the longest US government shutdown lasted 35 days. The current one has put IPOs on ice. |
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