Startups turn to tender offers to let staff sell stock before IPO

NewView and Carta have formed a partnership to help private companies offer liquidity to their employees.

The collaboration combines NewView’s experience in structuring secondary deals with Carta’s equity management platform. Ravi Viswanathan, founder and managing partner of NewView, stated that the goal is to streamline the process for launching liquidity programs. He described the initiative as a mutual benefit for employees, companies, and investors, hoping it will make CEOs more willing to consider tender offers.

A tender offer allows employees and early investors to sell a portion of their shares at a set price to an approved buyer. This mechanism is increasingly common among late-stage startups that remain private for extended periods. According to a recent study by NewView Capital and Carta, tender offers at Series C and later-stage companies have tripled over the past three years. Viswanathan noted that these transactions are no longer limited to high-profile firms like OpenAI, Databricks, or Anduril. He cited Hightouch, a marketing customization startup, as an example. NewView led a tender for Hightouch last year at a $1.3 billion valuation when the company was seven years old.

Despite the growth, tender offers remain rare relative to the total number of eligible startups. The same research found that only 44 such transactions occurred in the first half of 2026. Viswanathan argued that tenders serve as retention tools and morale boosters for staff who hold equity. He observed that the label of being a unicorn has lost some of its appeal for recruiting talent. "A tender is an opportunity to say you will also get liquidity in your journey with us," he said.

Several recent companies have utilized tender offers to provide cash flow to their workforce. Decagon, an AI customer support startup, and Wayve, a self-driving technology developer, are among the firms that have conducted these sales. ElevenLabs, an AI voice generator, executed two tender offers in under a year. Viswanathan said these practices are likely to continue as private companies extend the time before a public listing. "The companies are staying private for 12 to 15 years. That's not changing," he said. He added that liquidity is necessary to prevent top talent from leaving venture-backed firms for public companies.