Continuation Vehicles Dominate GP-Led Secondaries, Hitting $115B in 2025

GP-Led Volume Hits $115 Billion in 2025 The GP-led secondary market has reached a new milestone, with total transaction volume hitting $115 billion in 2025. Continuation vehicles — structures that allow GPs to transfer portfolio companies into a new fund while offering existing LPs the option to roll over or cash out — accounted for 89% of this activity, representing approximately 43% of the entire secondary market by volume. The data, published by CAIA, reflects a fundamental shift in how private equity managers are managing portfolio liquidity. The Structural Liquidity Squeeze Driving Demand The explosion in continuation vehicles is not a trend of convenience — it reflects genuine structural stress across the private equity industry: Distributions as a percentage of NAV have trailed historical norms by roughly 15% (28% vs. 13%) since 2022-2024 DPI for 2018-2021 vintages is approximately 0.2x lower than originally budgeted For every $3 of targeted fundraising, only $1 of capital is currently available to commit (vs. a historical 1.3:1 ratio) Buyout fundraising reached its lowest level relative to NAV since the Global Financial Crisis in 2025 With over $600 billion in dry powder sitting in global private equity funds, the pressure on GPs to generate liquidity without forcing asset sales at depressed prices has become acute. StepStone Targets $7B Across Two Vehicles StepStone Group is raising $7 billion across two complementary secondaries vehicles: a $6 billion Secondary Opportunities Fund targeting LP stake acquisitions, and a $1 billion continuation fund-focused strategy targeting GP-led transactions. The previous StepStone secondaries fund closed at $4.8 billion in 2024. Transaction volumes reached $103 billion in just the first half of 2025, according to Jefferies data. "Single-asset continuation funds have gained traction as GPs look to hold onto prized portfolio companies while still providing liquidity to investors." Why This Matters for Private Markets The continuation vehicle boom represents a structural realignment of private equity exit pathways. Rather than relying on IPOs or M&A — both of which have been constrained — GPs are essentially creating their own secondary liquidity market. For secondary buyers, single-asset CVs offer concentrated exposure to high-conviction assets with GP alignment, but require rigorous independent valuation to avoid overpaying in a seller-friendly pricing environment. As this market matures, the distinction between primary PE investing and secondary CV investing is becoming increasingly blurred.