New Partnerships Aim to Unlock Employee Liquidity as Startups Stay Private Longer

Startups are remaining in private hands longer than ever before, creating a persistent challenge for the employees who help build them. Typically taking a portion of their total compensation in equity that they cannot immediately sell, workers have historically faced long delays and limited hope of early liquidity.

This structural shift in the private markets has left many tech workers holding valuable stock on paper with no way to translate it into cash for major life milestones, such as buying a home, starting a family, or paying down debt. An increasing number of late-stage startups are recognizing this growing pressure and beginning to offer tender offers to their employees as a vital relief valve.

Tender offers are financial transactions that allow employees—and frequently early investors—to sell a portion of their shares for a predetermined price directly to an approved investor. These programs help bridge the widening gap between the rapid valuation growth of private companies and their eventual paths toward an initial public offering or acquisition.

To simplify and streamline this increasingly popular process, NewView Capital, a firm that specializes in secondary market deals alongside traditional venture capital investments, recently announced a strategic partnership with equity management platform Carta. The collaboration successfully combines NewView’s extensive secondhand deal-structuring experience with Carta’s robust digital equity platform.

Ravi Viswanathan, founder and managing partner of NewView Capital, pitches this joint effort as a practical way to help startups launch and manage comprehensive employee liquidity programs much more seamlessly than in the past.

“The hope is that this partnership will make it easier for CEOs and companies to think about tenders,” Viswanathan said. He wants modern startup founders to fundamentally reframe how they view giving employees early liquidity, describing it as a classic “win-win-win” scenario that benefits workers, the companies themselves, and institutional investors alike.

A growing number of private market leaders seem to agree with this assessment. Over the past three years, tender offers have increased threefold for Series C and later-stage startups, according to a recent comprehensive study published jointly by NewView Capital and Carta. Furthermore, the startups that choose to implement tender offers are no longer exclusively restricted to the most elite, multi-billion-dollar private companies in the world, such as OpenAI, Databricks, or Anduril, according to Viswanathan.

To illustrate this broader market adoption, Viswanathan pointed to Hightouch, a marketing customization startup and NewView portfolio company, which successfully executed a tender offer at a substantial $1.3 billion valuation last year. This demonstrates that mid-tier unicorns and high-growth late-stage companies are also finding ways to incorporate liquidity programs into their compensation strategies.

However, the joint Carta and NewView research also revealed that the overall share of startups launching these offerings remains relatively small across the broader ecosystem. The dataset recorded just 44 executed tender offers in the first half of the year, underscoring how much room the market still has to grow.

Because of this untapped potential, Viswanathan is actively encouraging other early-stage and late-stage startups to seriously consider implementing tender offers. He frequently characterizes them as exceptionally powerful employee retention tools and critical morale boosters in a hyper-competitive hiring environment.

A decade ago, simply holding unicorn status was often more than enough to attract top-tier talent to a burgeoning venture-backed company, Viswanathan noted. But today, with so many billion-dollar companies operating across various tech sectors, that prestigious status may not carry the same magnetic draw for prospective employees that it once did. Offering a structured tender program, he explained, provides a tangible opportunity to reassure candidates that they will also share in the financial upside and liquidity events throughout their journey with the company.

The push toward regular secondary liquidity is also gaining traction among some of the most prominent names in artificial intelligence and deep tech. Among the companies that have recently held or launched major employee tender offers are AI customer support startup Decagon, autonomous vehicle technology developer Wayve, and cutting-edge AI voice generator ElevenLabs, which notably executed two such offerings in less than a calendar year.

These high-profile examples highlight a broader cultural shift within the venture capital ecosystem. As macroeconomic conditions and regulatory shifts continue to lengthen the timeline from founding to exit, the traditional playbook of waiting for an IPO to reward early employees is undergoing a radical transformation.

“The companies are staying private for 12 to 15 years. That’s not changing,” Viswanathan said, emphasizing the permanent nature of the new market reality. “In that interim, so that we don’t have this talent drain from high-quality venture-backed companies into their public counterparts, we need to make sure that there is liquidity for the employees.”