Misconceptions of Running a Private Company Tender Offer

Thinking about returning liquidity to your company, investors or shareholders? We provided a list of the top misconceptions while running a tender offer.

Nasdaq Private Market
5 min readDec 20, 2021

Misconception: It takes less work to run a secondary tender offer with your cap table provider.

Nasdaq Private Market Response: Administration of a tender offer should incorporate quality assurance processes to help ensure data is accurate prior to the launch of the liquidity program…

Exporting the company’s data from its cap table provider is generally routine. Ahead of the launch of a tender offer program, the company sponsoring the program instructs its cap table service provider to transfer the cap table data to the dedicated team and service provider selected by the company to administer the program. The sponsoring company has a strong interest in ensuring that its data provided in connection with the program is updated and accurate. Accordingly, it’s an important step that the service provider administering the tender offer program performs quality assurance before the data is uploaded onto its tender offer platform. Nasdaq Private Market diligently supports its sponsoring clients and provides insight as they validate their data (the portion of the cap table that is required to conduct a transaction) prior to upload to the NPM Platform. It takes an experienced team using a purpose-built platform to help companies structure and smoothly execute a successful tender offer program.

Misconception: Data Inaccuracies Occur When Data is Removed from a Cap Table Provider

NPM Response: A transaction such as a tender offer program provides companies with an opportunity to review their data and ensure that it is accurate, whether they choose to run the program with their cap table provider or another service provider…

Because your data is always changing, the preparation stage of a secondary program is an important opportunity to ensure that the cap table data is clean and up-to-date. With the permission of the sponsoring company, Nasdaq Private Market will review all eligible participant holding data in real-time with the company’s team. NPM not only reviews to ensure all eligible participant data can be uploaded seamlessly to the NPM Platform, but can also help identify inconsistencies, clerical errors, and missing contact information that become common in complex capitalization databases over time.

“At my prior company, we were using an equity management platform that didn’t allow us to execute a secondary liquidity program. The NPM team spent time walking me through their platform, including what needed to be downloaded from the equity management platform, how to execute within the NPM platform, and how to integrate the secondary offering back into the equity management platform. It was a seamless process with no issues with data integrity, and the NPM team was always readily available to answer any questions” — Thuy Nguyen, Assistant General Counsel at MyFitnessPal

Misconception: It Takes Less Time to Run a Tender Offer with a Company’s Cap Table Provider

NPM Response: Each tender offer program requires offering documents, data, and compliance checks. Nasdaq Private Market can assist its clients in completing the tasks in a timely manner and launching the program within a two-day timeline…

NPM’s main focus is assisting its company clients in structuring a liquidity program in the company’s equity in accordance with the company’s preferences. Whether it’s a tender offer, buyback, auction, recurring windows of liquidity, or a block sale for key investors, NPM has been able to assist its clients in completing these transactions successfully. The NPM team’s speed and efficiency comes from experience, serving in its role as a partner to its clients in conducting these transactions. Coupled with NPM’s experience and its technology stack, clients are well served by a team and platform built exclusively to support various forms of transactions catered to client needs. NPM’s targeted function and purpose drives NPM to provide private companies with a highly successful and efficient experience in completing a tender offer transaction.

NPM Response: To discover the benefit of running a secondary, each Company should strategically consider their optimal structure. NPM provides insight on secondary mechanics and collaborates with each company to build this structure…

NPM’s dedicated account managers act as an extension of the company client’s team throughout the tender offer process, minimizing the company’s workload. Since each company leverages the secondary market at a unique point in its lifecycle with goals unique to the company, tender offers shouldn’t follow a one-size-fits-all methodology. Just like an M&A event, IPO, or primary transactions, the best partners are those that have the breadth and depth of experience in different types of transactions to help guide companies through this process. From its depth of experience, NPM is innovating and developing new technology to make these transactions less time intensive. Both its long-time advocates as well as its new partners believe in the NPM platform and its continued development and path forward. NPM works with its clients to structure the transaction meeting the individual needs of NPM’s company clients and shareholders.

Understanding these misconceptions before running a liquidity program such as a tender offer program can help private companies make the right decisions to execute a successful program. NPM’s veteran Client Services Team partners with its clients to educate its clients on different program structures, important market factors, and specific needs as a company. NPM’s focus and initiative is to create and administer efficient markets for private companies and their stock. NPM believes in transparency. NPM believes in accuracy. Misconceptions have no place in this market. To learn more about how NPM can partner with you to streamline liquidity for your company, visit our website or get in touch with our team, Sales@NPM.com.



Nasdaq Private Market

Nasdaq Private Market is advancing the secondary marketplace for private companies, employees & shareholders, banks & brokers, law firms and investors.