What Goldman’s VC move means for San Diego startups
Goldman Sachs’ plan to acquire Industry Ventures puts venture-capital secondaries front and center—and that has real implications for San Diego’s founders, operators, and investors. With local momentum in biotech and cybersecurity, from Kailera Therapeutics’ $600 million round to a La Jolla cyber deal, our region could be an early beneficiary of easier liquidity and deeper capital stacks. Here’s what to know, why it matters locally, and how to prepare.
The news, in brief
Goldman Sachs is acquiring Industry Ventures, a venture firm known for secondaries, in a deal valued at $665 million in cash and equity plus up to $300 million in performance-based payments. Industry Ventures manages roughly $7 billion and will bring its full team under Goldman’s asset and wealth management umbrella. The strategic bet: secondaries will grow faster than primary venture investing as companies stay private longer and investors seek more ways to actively manage portfolios.
Why secondaries matter in San Diego
Secondary transactions let investors, employees, and sometimes early founders sell private-company shares before an IPO or acquisition. In San Diego—where biotech, life sciences, and deep tech companies often face long R&D timelines—secondaries can be a critical tool to retain talent, refresh cap tables, and keep momentum during multi-year milestones. As liquidity options expand, more local teams can compete for top talent without relying solely on near-term exits.
Local signals: biotech and cyber heat up
Kailera Therapeutics, with hubs in Boston and San Diego, raised $600 million in Series B funding led by Bain Capital Private Equity. For San Diego’s life sciences ecosystem, that’s a vote of confidence in obesity therapeutics and a reminder that global-scale capital is flowing into platforms with strong SD footprints—think lab expansion, clinical hiring, and partnership potential with local research institutions.
Meanwhile, LevelBlue agreed to acquire La Jolla–based Cybereason, highlighting steady consolidation and continued demand for cybersecurity services across Southern California. Expect integration activity, new client offerings, and hiring ripples that touch the broader SD cyber community spanning defense, telecom, and AI-enabled security.
Primary vs. secondary venture at a glance
| Feature | Primary VC | Secondary VC |
|---|---|---|
| Purpose | Fund company growth | Provide liquidity for existing holders |
| Typical participants | Startups and new investors | Current shareholders and specialized buyers |
| Liquidity timing | Exit-driven (IPO/M&A) | Pre-exit, event-driven windows |
| Impact on employees | Equity upside long term | Partial cash-out to reduce risk, improve retention |
| Relevance to San Diego | Capital-intensive R&D, scaling | Long runways in biotech/defense demand flexible liquidity |
What this could change for San Diego founders, operators, and investors
Founders
Plan a liquidity playbook early. If secondaries become more accessible via bank platforms, you’ll field more inbound interest. Establish clear policies for employee sales, identify guardrails (blackout periods, caps, ROFRs), and align your board. Keep your cap table clean, equity grants updated, and data room organized to accelerate diligence when a tender offer or structured secondary arrives.
Operators and employees
Expect more employer-led programs (tender offers) or curated marketplaces offering partial liquidity. Understand vesting, exercise timelines, and tax implications before selling. Diversifying a portion of paper gains can reduce personal risk while keeping long-term upside—especially relevant for teams in multi-year clinical or federal procurement cycles common in San Diego.
Angels and local LPs
Bank-affiliated secondary funds could open doors to private-market exposure without sourcing individual deals. Scrutinize fees, governance, and alignment between banking platforms and the underlying venture strategy. For family offices, compare direct secondaries, fund-of-funds, and hybrid vehicles to match risk tolerance and liquidity needs.
Risks and realities
Not every company or round supports active secondary trading; liquidity is still selective and terms vary widely. Valuation gaps can emerge in volatile markets, and large institutions may introduce new approval layers or potential conflicts that founders must manage. Policy shifts—such as moves to enable more retirement access to private markets—could expand demand but also raise scrutiny around disclosure and suitability.
What to watch next in San Diego
- More secondary windows for growth-stage biotech and platform AI companies headquartered or operating in SD.
- Partnerships between local VCs and large banks to streamline tenders and employee liquidity programs.
- Secondary trading volumes trending toward the $200B mark, which could normalize pre-exit liquidity for top performers.
- Hiring waves tied to Kailera’s raise and post-acquisition plans at La Jolla–area cyber firms.
- Greater interest from national investors in San Diego’s R&D-heavy sectors as liquidity options reduce perceived holding risk.
Action checklist for SD founders
- Define a secondary policy (eligibility, limits, blackout periods) and socialize it with your board.
- Upgrade equity hygiene: verify option records, refresh 409A, reconcile your cap table, and prep a lightweight diligence pack.
- Choose a trusted liquidity partner; assess process speed, holder protections, and communications support.
- Educate employees: run a short session on mechanics, taxes, and trading windows; align with HR and legal.
- Scenario plan: model how secondary sales affect ownership, control provisions, and future primary rounds.
FAQs
- What is a VC secondary?
A transaction where existing private shares change hands, giving sellers liquidity before an IPO or acquisition. - Will this make it easier for SD employees to sell shares?
Likely for top-performing companies. Bank-backed platforms could create more structured, compliant windows. - Does Goldman’s move mean more funding for local startups?
It mainly expands liquidity options. Indirectly, easier secondaries can attract talent and stabilize growth, which can support future primary rounds. - How should a founder prepare for a tender offer?
Align your board, set clear rules, ensure clean cap tables, and communicate timelines and eligibility to your team. - Are secondaries right for every startup?
No. They work best when growth is strong, governance is ready, and the company can support transparent pricing and process.
Bottom line: San Diego leaders should build a practical liquidity strategy now—set policy, clean the cap table, choose a partner—so when secondary windows open, your team can access cash without losing focus on building enduring value.
