Annual Continuation Vehicles Report 2026: Perspectives
Continuation vehicles have become one of the most significant structural developments in private markets over the last five to 10 years. Once used sparingly to address liquidity or fund life constraints, they are now a recurring portfolio management tool within the GP-led secondary market. Their growth reflects extended asset hold periods, record levels of unrealized value in private market portfolios, constrained exit markets, and increasingly divergent liquidity preferences among limited partners.
Overview of the current landscape based on our own deal data:
- 97% of CVs charge a management fee of 1% or less
- 49% of CVs have a stepdown of management fees on an extension to the initial term
- 79% of CVs include a tiered carry, with 60% adopting both internal rate of return (IRR) and multiple on invested capital (MoIC) return thresholds
- 74% of CVs have a five-year initial term, with 92% of CVs providing for up to two years of term extensions
- 64% of CVs include key person provisions
In this report, we examine continuation vehicles through three interrelated perspectives: that of the sponsor, structuring and executing the transaction, the lead investor, anchoring the transaction, and the existing investor, receiving election materials and evaluating a roll-or-sell decision.
Each perspective is informed by different incentives, constraints, and fiduciary considerations, and each engages with the same legal terms and process in materially different ways, with a sponsor balancing asset conviction against fiduciary and reputational considerations, a secondary buyer underwriting concentrated risk, and an existing investor assessing fairness and optionality.
The report aims to provide a more grounded and practical framework for understanding continuation vehicles as they function in today’s market. In an environment where GP-led transactions are likely to remain a permanent feature of private markets, appreciating both the empirical trends and the perspectives of key participants is essential to structuring transactions that are defensible, executable, and sustainable over the long term.
