Secondary Sales in Startups Shift from Founder Windfalls to Employee Retention Tools

In 2026's competitive startup ecosystem, secondary stock sales are evolving from founder cash-outs to vital employee retention strategies.

This marks a stark contrast to the 2021 ZIRP-era boom, where founders like Hopin's Johnny Boufarhat sold $195 million in shares before the company's valuation crashed dramatically.

Employee Liquidity Takes Center Stage

Fast-growing AI startups like Clay are now offering tender opportunities to all employees, fostering morale and loyalty.

Clay enabled sales at a $5 billion valuation recently, a more than 60% increase from $3.1 billion in August after its Series B.

The eight-year-old AI sales automation firm tripled its ARR to $100 million in just one year, justifying the liquidity event.

More Startups Follow the Trend

Linear completed a tender at its $1.25 billion Series C valuation, while ElevenLabs authorized a $100 million secondary at $6.6 billion, doubling its prior mark.

Clay co-founder Kareem Amin stated the main goal is ensuring gains do not accumulate only to a few people.

NewView Capital partner Nick Bunick affirmed, “We’ve done a lot of tenders, and I haven’t seen any drawbacks yet”, calling a little liquidity healthy.

Broader Impacts and Future Challenges

These programs help startups compete for talent with mature players like OpenAI and SpaceX that offer similar perks.

However, Saint Capital's Ken Sawyer warns it enables prolonged private tenures, reducing liquidity for venture investors and LPs.

Looking ahead, this shift could strain the VC ecosystem if delayed returns deter future investments, balancing employee benefits against investor needs.

For more details, see the original TechCrunch reporting.