Transparency Is Coming to Private Markets - Slowly

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Welcome to Unlocking Liquidity, the podcast from PrimaryMarkets exploring the opportunities and challenges shaping private markets.

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Access to an investment is one thing. Having the information to assess it confidently is another.

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In this episode, we explore why transparency is coming to private markets—and why progress remains slow. From Australia’s scrutiny of private credit to the valuation of unlisted assets, we examine what better disclosure means for wholesale and sophisticated investors.

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We also discuss the difference between a company’s stated valuation and an achievable transaction price, how secondary trading can contribute to price discovery, and why clearer information matters for companies raising capital.

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Join us as we look at how greater transparency can support more informed decisions across unlisted markets.

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Private markets have long operated on the understanding that access to an investment does not necessarily come with easy access to information. Investors may be able to acquire an interest in a promising business, property portfolio or private fund, yet still face considerable difficulty assessing its current value, financial position or prospects for an eventual exit.

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For wholesale and sophisticated investors, this information gap is part of the investment landscape. It is also one of its most persistent sources of friction. Negotiating access to financial statements, understanding shareholder rights and distinguishing a credible valuation from an ambitious asking price can require substantial time and expertise.

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Pressure for greater transparency is building. In Australia, regulatory scrutiny of private credit and unlisted asset valuations is bringing the issue into sharper focus. The implications extend beyond funds management to the companies raising private capital, shareholders seeking liquidity and investors evaluating unlisted opportunities.

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However, the transition will be gradual. Private markets encompass different assets, ownership structures and reporting arrangements. Better information will emerge through a combination of regulatory attention, investor expectations, stronger governance and more effective transaction infrastructure.

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Transparency is sometimes treated as a question of how many documents an investor receives. In practice, its value depends on whether those documents support an informed decision.

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A substantial information memorandum can still leave important questions unanswered. Revenue forecasts may receive considerable attention while working capital requirements remain unclear. A company valuation may be presented prominently without explaining the assumptions behind it. An intended exit may be described without acknowledging how much depends on future market conditions.

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Meaningful transparency connects the investment proposition with evidence. It allows investors to understand how a business generates revenue, how it uses capital, what obligations rank ahead of shareholders and which factors could materially change the outcome.

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Timing matters equally. Financial information that was accurate when prepared can become less useful after a major acquisition, a financing change or the loss of a significant customer. Investors need to understand the reporting date and what has happened since.

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For unlisted shares, transparency also requires clarity about the security itself. Different share classes can carry different voting, dividend, conversion and distribution rights. Understanding the business is only part of understanding the investment.

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Australia’s private credit sector provides a practical example of how expectations are changing. Although private lending differs from investing in unlisted equity, both involve challenges around information quality, valuation and the ability to exit.

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In September 2025, ASIC released its commissioned report, *Private Credit in Australia*. The regulator highlighted concerns including unclear remuneration and fee arrangements, related party transactions, valuation practices and inconsistent terminology. It also recognised that well-managed private credit can complement bank lending and support economic activity.

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The scrutiny continued into 2026. Ahead of 30 June valuations and reporting, ASIC called for valuations based on current information and realistic assumptions. It identified inconsistent definitions of arrears, impairments and loan amendments as an obstacle to comparing funds. ASIC also reported that improvements in industry practices remained uneven. (https://www.asic.gov.au/about-asic/news-centre/news-items/asic-puts-private-credit-on-notice-ahead-of-30-june-valuations-and-reporting?utm_source=chatgpt.com)

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For investors, the broader lesson is that disclosure must be interpretable. Two investment providers can use similar language while measuring different things. Reporting becomes more useful when definitions, assumptions and changes in methodology are explained.

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These developments should not be read as a single new disclosure regime covering every private investment. They do, however, demonstrate increasing scrutiny of how private market participants substantiate the information they provide.

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Australia’s superannuation sector offers another example, particularly because unlisted investments can sit inside portfolios that members can switch between or withdraw from when eligible.

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In December 2024, APRA published findings from a review of 23 superannuation trustees representing approximately 80 per cent of assets managed by APRA-regulated superannuation entities. It found that 12 required material improvements in their valuation governance, liquidity risk management or both. Weaknesses included oversight, conflicts management and the frequency and triggers for revaluations. (https://www.apra.gov.au/news-and-publications/apra-review-highlights-need-improved-valuation-and-liquidity-risk-governance?utm_source=chatgpt.com)

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This illustrates why a valuation should be assessed as a process as well as a number. Who prepares it? Who challenges it? What evidence supports it? What developments would trigger a reassessment?

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Those questions are also relevant to direct holdings in unlisted companies, although the governance arrangements and applicable obligations differ. Investors benefit from understanding whether a stated value reflects a recent transaction, an independent assessment, management assumptions or a historical capital raising.

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One of the most important distinctions in private markets is the difference between an estimated value and the price at which a transaction can actually occur.

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A business may have raised capital at a particular valuation when growth expectations, financing conditions and investor sentiment were more favourable. That valuation remains a historical reference point. It does not establish what a buyer would pay today.

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The terms of the earlier investment also matter. A funding round involving preference shares may include protections that ordinary shareholders do not hold. Applying the same headline price to both securities can obscure meaningful differences in their economic rights.

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Consider a hypothetical Australian technology company whose last funding round took place two years ago. Since then, sales have increased, but operating costs have risen faster and another capital raising is required. A prospective buyer of existing ordinary shares would need to assess cash runway, potential dilution and the rights attached to the earlier funding round before drawing conclusions from its valuation.

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Better transparency would make those factors visible. It would not eliminate disagreement about value. In a functioning market, informed buyers and sellers can reasonably reach different conclusions.

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Secondary transactions can add useful evidence to a market where valuation references are otherwise infrequent. When an existing shareholder sells to a new investor, the agreed price provides information about what those parties were prepared to accept under the circumstances.

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That evidence becomes more informative when the surrounding details are understood. The date, size of the holding, share class, transfer conditions and information available to the parties can all affect the relevance of a transaction price.

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A small sale by a shareholder seeking an urgent exit may not establish the value of an entire company. Equally, an asking price records a seller’s expectation rather than a completed transaction. Transparency requires those distinctions to remain clear.

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For platforms facilitating the trading of unlisted shares, this creates an important role for structured information and clear transaction processes. Helping eligible buyers and sellers assess opportunities can reduce some of the friction associated with private transactions.

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However, access to a trading facility does not guarantee a buyer, a particular price or an exit within a preferred timeframe. Better price discovery and greater liquidity are related objectives, but progress in one does not automatically deliver the other.

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The slow pace of change partly reflects the diversity of private markets. A profitable family-owned manufacturer, a biotechnology company awaiting trial results and a property development business have different operating risks and information requirements.

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Reporting that is useful for one can be inadequate for another. Historical earnings may be central to assessing an established manufacturer. Cash runway and development milestones may be more important for an early-stage biotechnology business. A property project may require close attention to funding commitments, construction costs and sales assumptions.

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Commercial confidentiality creates another constraint. Detailed customer pricing, intellectual property and sensitive negotiations may affect an investment decision, but publishing them without restriction could damage the company.

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Controlled access can help manage that tension. Confidential data rooms and appropriate confidentiality arrangements allow relevant information to be shared with prospective investors while protecting legitimate commercial interests. The objective is to give authorised participants sufficient information to assess the opportunity responsibly.

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There is also a practical cost. Reliable reporting requires accounting systems, management attention and governance processes. Smaller businesses may need to build those capabilities progressively. Technology can make information easier to distribute, but it cannot ensure that the underlying records are complete or the assumptions sound.

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For wholesale and sophisticated investors, eligibility to participate in a private investment does not resolve the underlying information gap. Experience helps investors interpret information and recognise unanswered questions. It cannot compensate fully for material facts that are unavailable.

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Due diligence therefore needs to examine both the investment and the reporting relationship that follows it. Before committing capital, investors should understand what financial information they can expect, how frequently it will be provided and what rights they have to receive it.

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Consistency is particularly important. If a company changes the way it measures recurring revenue, operating earnings or customer retention, investors need an explanation of the change and its effect on comparisons. Otherwise, an apparent improvement may reflect a revised definition rather than stronger performance.

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The same discipline applies to forecasts. A credible forecast explains its assumptions, funding requirements and sensitivity to setbacks. Clear discussion of uncertainty can be more useful than a precise projection unsupported by evidence.

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For an investor assembling a portfolio of unlisted holdings, these reporting arrangements affect the ability to monitor concentration, financing exposure and potential capital calls across multiple investments.

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Companies seeking capital have a commercial reason to improve their reporting before approaching investors. Incomplete or inconsistent information introduces uncertainty, extends due diligence and can undermine confidence in management.

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A company that explains its financial position, ownership structure and funding requirements clearly gives investors a stronger basis for evaluating its proposition. It also helps management identify and address issues before they become obstacles during negotiations.

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This does not mean transparency will produce a higher valuation. Better information may reveal risks that lead investors to seek different terms or decline an opportunity. Its value lies in supporting a more credible assessment and reducing avoidable surprises.

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The discipline should continue after a capital raising. Regular updates that address performance against expectations, material setbacks and changes in strategy help shareholders follow the business between transactions. That continuity can also improve the information available if a shareholder later seeks to sell.

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Greater transparency in private markets will be built through practical improvements: more current financial information, clearer valuation explanations, more consistent definitions and better communication of shareholder rights and transfer conditions.

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The Australian examples show both the direction of travel and the work still required. Regulatory attention is increasing, yet implementation remains uneven. Investors and companies have an opportunity to improve the quality of their own transactions without waiting for every market practice to become standardised.

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For PrimaryMarkets, as a platform for raising capital and trading unlisted shares for wholesale and sophisticated investors, the relevance is direct. Access to opportunities is more useful when participants can understand the business, assess the available information and recognise the conditions affecting a potential transaction.

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Private market investing will continue to involve uncertainty, judgement and the possibility of loss. Greater transparency can make those risks easier to examine and discuss. Over time, that provides a stronger foundation for capital raising, shareholder engagement and informed participation in unlisted markets.

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As private markets continue to evolve, investors and companies are increasingly seeking greater access, transparency and liquidity. (http://www.primarymarkets.com)is an Australian-based platform that helps facilitate capital raising and secondary trading opportunities in private companies, managed funds and other unlisted investments.

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Through its capital raising and trading solutions, PrimaryMarkets connects sophisticated and wholesale investors with a diverse range of private market opportunities across sectors including technology, healthcare, energy, resources, property and alternative assets. The platform also assists companies and fund managers to access growth capital while providing existing shareholders and unitholders with potential liquidity pathways.

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By combining technology with market expertise, PrimaryMarkets is helping to modernise private capital markets, making it easier for investors to discover opportunities and for companies to connect with capital. As the private market ecosystem continues to mature, platforms such as PrimaryMarkets are playing an increasingly important role in improving access, facilitating transactions and supporting the efficient flow of capital.

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And that brings us to the end of this episode of Unlocking Liquidity. Thanks for spending your time with us, we hope today’s conversation gave you a fresh perspective on private markets and how liquidity is evolving. If you enjoyed the episode, please follow or subscribe wherever you listen, and feel free to share it with someone who’d get value from it. For more insights, opportunities and episodes, visit PrimaryMarkets.com. Until next time, thanks for listening, and we’ll see you in the next conversation.