Startups Embrace Tender Offers to Provide Early Liquidity for Employees
Startups are increasingly choosing to remain private for longer periods, which often leaves employees holding stock options that cannot be sold early. This lack of liquidity poses a challenge for employees who typically accept stock as part of their compensation but have little opportunity to convert those shares into cash before an eventual exit event such as an IPO or acquisition.
In response, a growing number of late-stage startups have begun offering tender offers—transactions that enable employees and sometimes early investors to sell a portion of their shares at a predetermined price to approved investors. These tender offers provide a pathway for employees to access liquidity without waiting for the company to go public.
Streamlining Tender Offers Through Strategic Partnerships
To simplify the tender offer process, NewView Capital—a venture firm specializing in secondary market transactions alongside traditional investments—recently announced a partnership with Carta, a leading equity management platform. This collaboration leverages NewView’s expertise in structuring secondary deals combined with Carta’s technology to help startups launch and manage liquidity programs more efficiently.
Ravi Viswanathan, founder and managing partner of NewView Capital, frames this partnership as a means to encourage startups and their CEOs to view tender offers as a “win-win-win” solution that benefits employees, companies, and investors alike. By making the tender offer process more accessible and manageable, the partnership aims to empower startups to provide early liquidity opportunities seamlessly.
Growing Adoption and Benefits of Tender Offers
Evidence of rising adoption is clear: over the past three years, tender offers for Series C and later-stage startups have tripled, according to a recent study by NewView and Carta. Importantly, the startups utilizing tender offers are not limited to a handful of high-profile unicorns like OpenAI, Databricks, or Anduril. Companies across various sectors and valuations, such as marketing customization startup Hightouch—which held a tender offer at a $1.3 billion valuation last year—are also participating.
Despite this growth, the overall number of startups conducting tender offers remains modest, with only 44 transactions executed in the first half of 2026 within the combined dataset from NewView and Carta. Viswanathan encourages more startups to consider tender offers, emphasizing their value as employee retention tools and morale boosters, especially in an era when simply being a unicorn is no longer a unique selling point for talent acquisition.
Tender Offers as a Competitive Edge in Talent Retention
A decade ago, achieving unicorn status was sufficient to attract and retain top talent. However, with an increasing number of billion-dollar private companies competing for skilled employees, startups must offer more than just valuation milestones. Viswanathan suggests that tender offers provide a compelling incentive by promising employees liquidity during their tenure, framing it as an integral part of the employee’s journey with the company.
Recent examples of startups that have successfully executed tender offers include AI customer support company Decagon, self-driving technology developer Wayve, and AI voice generator ElevenLabs, which notably completed two tender offers in under a year.
Viswanathan highlights that startups today typically remain private for 12 to 15 years, a trend unlikely to change soon. Therefore, to prevent talent from migrating to public companies where liquidity is more readily available, it is crucial to offer liquidity mechanisms like tender offers within private companies.
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