Secondary Markets & Tender Offers
How to sell private shares before an IPO. Platforms, tax implications, and who's eligible.
What you’ll learn
- ✓How secondary sales work: direct sales, tender offers, and platforms
- ✓Platforms: Forge, Hiive, NPE, and direct-to-investor sales
- ✓Right of First Refusal (ROFR) — how companies can block your sale
- ✓Tax treatment of secondary sales (ISOs vs. NSOs vs. RSUs)
- ✓Tender offers — when companies buy back shares from employees
- ✓Who's eligible and how to find out if your company allows it
Startup equity used to be completely illiquid until IPO or acquisition — you waited, sometimes for a decade, and either got paid or didn't. That's changed. A mature secondary market now lets employees sell vested shares in private companies before any liquidity event, sometimes at significant premiums.
But secondary sales are complicated, heavily regulated, and often require company approval. Not every employee is eligible, not every company allows it, and the tax implications are non-trivial.
In this chapter, you’ll work through the exact framework for secondary markets & tender offers. We cover each of the key topics with worked examples, real numbers, and actionable steps you can take immediately.
- ✓How secondary sales work: direct sales, tender offers, and platforms
- ✓Platforms: Forge, Hiive, NPE, and direct-to-investor sales
- ✓Right of First Refusal (ROFR) — how companies can block your sale
- ✓Tax treatment of secondary sales (ISOs vs. NSOs vs. RSUs)
- ✓Tender offers — when companies buy back shares from employees
- ✓Who's eligible and how to find out if your company allows it
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