Structural inefficiencies in emerging private markets continue to offer return premiums unavailable in liquid public markets. We outline our framework for identifying them.
Liquid public markets in developed economies are intensely competitive. Thousands of well-resourced participants analyse the same companies with the same data, and genuine informational edges are rare and fleeting. Private markets in less efficient economies are different in kind: information is costly to gather, intermediation is thin, and patient capital is scarce. Those frictions are precisely what create the opportunity.
We are deliberately selective. We participate only where our network, sector knowledge, or analytical capacity creates value that the founder cannot easily source elsewhere. We favour growth-stage and established private businesses with strong unit economics and defensible market positions, and we prefer founder-led companies whose incentives are structurally aligned with ours.
The illiquidity premium is real, but it is not free. It compensates investors for accepting capital lock-ups, limited price discovery, and concentrated governance risk. We treat it as a premium to be earned through diligence rather than assumed, and we size positions accordingly. A private investment that cannot be defended on its standalone economics does not become attractive simply because it is private.
Our role does not end at the point of investment. We participate actively in governance, support management through the operational decisions that determine outcomes, and align ourselves with multi-year value creation rather than short-cycle financial engineering. The compounding advantage of private markets accrues to partners, not to traders.
This article reflects the views of Saman Capital Management as of the date of publication and is provided for informational purposes only. It is not investment advice, nor an offer or solicitation to buy or sell any security. See our disclosures.