The Battery East Group is a small confab in San Francisco that specializes in secondary offerings, the sale of stock from inside shareholders, early employees and the like that want malleability for their equity before a traditional liquidity event.
In human terms, it means that the Group helps people sell their startup stock either before their company goes public or is purchased by a larger company.
Battery East is growing at a propitious time for its offering: Companies are delaying their public debuts, creating pressure for long-time shareholders for flexibility. Secondary sales are a tricky subject, given that they can indicate that current shareholders want out of the firm that they work for. But at the same time, it isn’t unreasonable for individuals who have worked hard for a half decade or more for more equity than cash to want to buy a house or pay down debt.
The Group has an interesting formula: It works with both the buy and sell sides, only facilitating sales of inside shares when the company in question approves the transaction. It also helps find purchasing investors that have a longer-term investment perspective on the company — investors that might stick around longer than a group looking for a quick IPO turnaround.
Battery East Group is only a four-person shop, recently picking up Duncan Niederauer, former CEO of the NYSE.
I sat down with the Group’s Barrett Cohn and Howard Caro to chew over what they are up to and how they are doing it.