Prof G Markets: Carta and the Secondary Market, Bitcoin ETFs, and Scott’s 2024 Investment Strategy

Carta's Controversy

The controversy surrounding Carta's misuse of data in its secondary market attempts has sparked significant debate in the startup community. Claire Atkinson explains that a Carta salesperson used confidential customer information from its cap table business to make sales calls for the secondary markets business, leading to outrage and Carta's exit from the secondary markets 1. Despite this scandal, Scott Galloway believes Carta will survive, although it may have to abandon its secondary market ambitions 1.

The fact that some salesperson used that information to start calling people and saying, would you be interested in selling some of your stake or adding to it, obviously that's a violation of trust.

--- Scott Galloway

The incident highlights the growing demand for secondary markets, especially as IPO markets remain stagnant, creating a void filled by secondary players 1.

   

Market Opportunities

The secondary market presents enormous opportunities despite its current inefficiencies. Scott Galloway shares his experience with high fees in this market, noting a 7% fee on a potential deal, which he found excessive compared to traditional markets like Schwab 2. This highlights the need for more efficient platforms to facilitate transactions in private markets.

The thing that really turned me off doing the deal was, wait, you want 7%? I mean, Schwab takes, I don't know, a 10th of a percent.

--- Scott Galloway

He questions why major financial institutions like JP Morgan and Goldman Sachs haven't entered this space, suggesting that the market's inefficiencies and illiquidity are ripe for disruption 3.