The sponsor's best exit is now to keep the company.

How large is the continuation vehicle market now?

Large enough that it is the sponsor's most common alternative to a sale. Evercore's first-half 2026 review puts total secondary volume at about 121 billion dollars, up 19 percent on the first half of 2025, with sponsor-led transactions at about 65 billion dollars against 56 billion dollars of fund-investor sales. That is the first half in which sponsor-led volume, at 54 percent of the mix against 47 percent for 2025, has been the larger side.

Lazard's interim report, published the same month, counts 124 billion dollars, up roughly 28 percent, and splits it the other way: 61 billion dollars sponsor-led and 63 billion dollars investor-led. The two houses draw the line between the categories differently and survey different buyers, so the disagreement on the split is a definitional one. Both agree on the direction and on the scale: Lazard's trailing twelve months through June reach about 260 billion dollars, double the market's 2021 level, and both houses now guide to a record full year, Evercore at 250 to 260 billion dollars and Lazard at 275 billion dollars.

Within the sponsor-led half, one structure did the growing. Evercore measures single-asset continuation vehicles at about 34 billion dollars in the half, up 88 percent year on year and 53 percent of sponsor-led volume, with multi-asset vehicles at a further 33 percent. Private equity assets are 65 percent of sponsor-led volume, infrastructure 16 percent and credit 11 percent. Evercore's separate credit review counts 20.4 billion dollars of credit secondaries in the half, more than double the prior-year period and already ahead of all of 2025.

What does the buyer pay for a single-asset vehicle?

Full price, on the majority of volume. Evercore reports that 52 percent of single-asset continuation vehicle volume cleared at par to the sponsor's carrying value and a further 14 percent cleared above it, leaving 34 percent at a discount. Multi-asset vehicles priced worse: 71 percent of that volume cleared below par, 22 percent at par and 8 percent above.

The buyer pays that price while underwriting to a higher return, not a lower one. Evercore puts the average target gross multiple at about 2.3 times for a single-asset vehicle, against about 1.9 times for a multi-asset vehicle, 1.8 times for a single fund interest and 1.7 times for a diversified portfolio of fund interests, on a four-year horizon, with the upper end of single-asset targets above 2.7 times. Evercore's explanation is selection: the sponsor is backing its highest-conviction company, and the buyer gets to diligence the company, its management team and its exit path in depth rather than pricing a blind pool.

The terms have moved with the competition. Evercore reports that super-carry, a promote that gives the sponsor greater participation above a return hurdle, now features in more than a third of sponsor-led transactions and concentrates in the highest-quality assets. Deferred consideration is rarer on the sponsor-led side, with 84 percent of that volume paid entirely upfront against 66 percent of investor-led volume, and where a deferral is used the balance typically settles within twelve months.

Pricing elsewhere in the market gives the same reading. Evercore reports that buyout fund interests sold by investors cleared consistently in the 90s as a percentage of carrying value, with non-software strength outweighing software-heavy softness, and that about 194 billion dollars of dedicated capital remains available, down 10 percent since the start of the year, with a further 154 billion dollars targeted for the second half.

Which companies are not getting this treatment?

Software, for now. Evercore reports that software continuation vehicles were 10 percent of first-half sponsor-led volume, down from 18 percent in 2025, and that a roughly 2 trillion dollar decline in public software value widened bid-ask spreads and pushed buyers out of the segment. Lazard's third headline finding is the same observation from the buyer's side: secondary buyers sharpen underwriting discipline amid widening software bid-ask spreads.

That is a valuation dispute rather than a verdict on the structure. A continuation vehicle needs a price both the sponsor's existing investors and the new buyer will accept, and where public comparables have moved by that much in a year, the two sides have not yet met. Evercore's survey of more than 100 secondary buyers ranks macro volatility as the leading factor for the second half at 73 percent of respondents, ahead of the return-of-capital imperative at 70 percent and fund-investor liquidity needs at 58 percent. A lack of quality supply, at 36 percent, ranks last.

What changes for the company that becomes the asset?

The counterparty, the clock and the equity. A trade sale or a sponsor-to-sponsor sale replaces the owner; a continuation vehicle keeps the same sponsor in control with a new set of investors behind it and, on Evercore's target-return figures, an expectation of roughly doubling the money again over about four years. The company is being selected, not disposed of. Evercore's continuation vehicle performance study, run with HEC, attributes the upside in the best single-asset vehicles to that positive selection: the sponsor keeps the assets it expects to perform.

For a founder or management team that sold a majority stake to a sponsor between 2019 and 2022, that is now the most likely form the next transaction takes. Lazard's first two headline findings are that large-cap sponsors embrace the secondary market as a mainstream liquidity tool and that continuation fund-to-continuation fund exits emerge as a structural tool for sponsors. The second point matters more than it reads: a company can now be rolled a second time, which means the management equity, the incentive plan and the personal liquidity of the people running it are being reset on a cycle the sponsor controls.

Ruben Schwagermann, Managing Director: "When a sponsor rolls a company into a continuation vehicle, management is being told it is the best asset in the fund and is being asked to sign up for another four years on the strength of that. The questions to settle before signing are what the rollover is worth at the new price, how much of it is liquid now, and what the incentive plan pays if the second exit is a third vehicle rather than a sale."

The practical reading of the two reports is that the company's own numbers set the terms. Two thirds of single-asset volume cleared at or above carrying value because the buyer could diligence one company and one management team; the third that cleared below did not fail the structure, it failed the diligence. Lazard's 77 billion dollars of capital earmarked for sponsor-led deployment in the second half, and Evercore's 104 billion dollars of sponsor-led dry powder, are waiting for the companies that pass it.