In the latest episode of ION Influencers Fireside Chats, host Giovanni Amodeo sat down with Todd Shin, Partner at Axiom Asia, to explore the evolving dynamics of secondary private equity investments in the Asia Pacific region. The conversation revealed valuable insights for institutional investors, private equity professionals, and secondary market participants.

Key Topics Discussed:

Current State of the Secondaries Market in Asia

• While global secondary transactions reached $152B in 2024, Asia-Pacific’s share dropped to a historic low of $3.4B.

• This is not due to a lack of supply, but rather a lack of buyer demand for Asian assets.

• Dry powder allocated to Asian secondaries declined from 11% in 2020 to just 5% in 2024.

Why Asia Is a Buyer’s Market

• Significant valuation corrections since 2021 create attractive entry points.

• Asia has $1.5T in unrealized private equity investments, including $150B+ in over-aged funds.

• Buyers with local insight and capital can access high-quality assets at discounts.

Benefits of Secondaries for Investors

• Offers de-risked exposure with shorter duration to liquidity.

• Helps mitigate the J-curve.

• Provides targeted access to oversubscribed GPs and specific geographies or sectors.

• Particularly compelling for institutional investors due to the complexity and required due diligence.

Deal Origination: Proprietary vs. Intermediated

• Axiom relies on its long-term GP relationships across 90+ managers in Asia.

• Maintains robust intermediary ties while leveraging its proprietary “Mine” database tracking 2,700+ GPs and 20,000+ companies.

Technology & Data-Driven Investing

• Proprietary intelligence helps identify motivated sellers, price deals, and assess GP quality.

• In Asia, information asymmetry is more prominent, so localized data collection and on-the-ground presence are key.

GP-Led Secondaries & Continuation Funds

• Growing in popularity as GPs seek liquidity solutions without exiting assets.

• Red flags include lack of alignment, weak rationale for continuation, or GPs prioritizing self-interest.

• Axiom expects GPs to roll carry, reinvest, and show conviction.

Market Transparency & Evolution

• Transparency is improving, driven by GP familiarity with the secondary process and intermediary support.

• Still, Asia’s market remains less standardized than the US or Europe.

Outlook for 2025 and Beyond

• Australia and Korea are key markets to watch, with rising GP-led activity.

• Expecting increased volume as funds near maturity and the exit market shows early signs of recovery.

• Secondary opportunities are also expanding into venture capital in Asia.

Key timestamps:

00:06 Introduction to the Fireside Chats
01:19 Axiom’s Recent Fund Closure
02:45 The Growing Importance of Secondaries in Asia
03:27 Market Dynamics Affecting Secondary Transactions
05:25 Investor Perspective on Secondary Investments
07:08 Institutional vs. Private Wealth Investors
08:05 Generating Deal Flow in Secondaries
09:16 Leveraging Technology for Insights
10:50 Transparency in the Secondary Market
12:19 Assessing GP Motivations for Continuation Funds
13:43 Identifying Red Flags in GP Proposals
16:41 Future Outlook for Secondary Market Activity
18:07 Exploring Secondary Opportunities Beyond Private Equity
20:05 Expanding GP Relationships and Network
20:54 Travel Plans and Market Focus
21:46 Learning from Global Markets
22:48 Closing Thoughts and Insights