Michael Halper, CFA, Partner and Portfolio Manager at ABS Global Investments, joined Keith Black, Managing Director of RIA Channel, to discuss the opportunities investors may miss by holding only publicly-traded growth stocks.
ABS Global Investments is an $11 billion1 asset manager with operations in the US, Europe, and Asia. Founded in 2003, the firm initially focused on public equity markets but has since evolved to invest in late-stage private markets.
Unicorns are private companies with a capitalization exceeding $1 billion and are typically fast-growing firms backed by venture capital, which is funded by institutional investors. There are over 1,500 unicorns today with a combined capitalization exceeding $5 trillion.2 The size and scale of these late-stage private companies are comparable to those of publicly traded firms. To reach these valuation levels, the firms need to have established leadership in their markets and achieved strong revenue growth. Most of these companies have a management team focused on an exit within one to three years.
Halper notes that many growth opportunities for equity investors have shifted from the public to the private markets, as unicorns are staying private longer, delaying their initial public offerings (“IPOs”) by four years compared to companies going public in prior decades. The number of publicly traded companies has declined by 50% over the last two decades, while the number of private companies backed by private equity or venture capital investors has increased by 18 times.3 The top 50 venture-backed companies grew revenues by an average of 150% in 2025, more than seven times the growth rate of the top 50 publicly traded growth companies.4
The ABS team has experience in primary and secondary venture capital investing in sectors such as technology, media, consumer discretionary, and life sciences. The private company investments are sourced through these long-term relationships and strategic partnerships. The Pre-IPO and Growth Fund (IPOSX) is a closed-end interval fund that invests in public and private growth companies, building on two decades of investing experience. The fund allocates 80% to private investments and 20% to cash and growth-oriented public equities to provide liquidity. The fund is available on the Fidelity platform and offers 1099 tax treatment with no investor eligibility requirements. Halper sees advisors holding this fund to complement their exposure to small and mid-cap growth equities or as a sleeve in their alternative investment allocation alongside traditional private equity holdings.
**For Investment Professionals Only**
WEBCAST REPLAY – Pre-IPO Investing: The Evolution of Growth
Join us for a webcast covering:
• Late-Stage Pre-IPO Opportunity Set: Growth of the global unicorn market and the shift of value creation from public to private markets.
• Why Growth Equity Now: Companies are staying private longer, creating opportunities for investors to access mature, revenue-generating businesses prior to IPO, with shorter expected time to liquidity.
• Co-Investment Strategy & Structure: Late-stage co-investments alongside experienced partners, emphasizing lower fees, immediate capital deployment, J-curve5 mitigation, and targeted position sizing.
• Investment Process & Due Diligence: Differentiated sourcing and a disciplined research framework evaluating valuation, sustainable growth, competitive dynamics, and exit pathways.
• Portfolio Construction Implications: How late-stage pre-IPO allocations may enhance return potential and reduce correlation.6
Accepted for 1 CFP® / IWI / CFA CE Credit
Resources
Fund Objective: seeks long-term capital appreciation.
Investors should carefully consider investment objectives, risks, charges and expenses before investing. For this and other information about the Fund, please call (877) 499-9990 or download at www.absinv.com. Read the prospectus carefully before investing or sending money.
Fund Risks:
The Fund is a closed-end interval fund. The Fund is new with a limited operating history. An investment in the Fund is speculative, involves a high degree of risk, and is not suitable for all investors. The Fund is suitable only for investors who can bear the risks associated with the limited liquidity of the Fund and should be viewed as a long-term investment. The Fund will invest in highly illiquid investments. Although the Fund intends to offer limited quarterly repurchase offers, repurchases are subject to conditions, may be suspended or modified, and may be funded through borrowings or asset sales at unfavorable prices. Investors may lose some or all of their investment.
The Fund invests primarily in private, illiquid, and difficult-to-value investments, including private equity, venture capital, SPVs, and pooled investment vehicles, and generally has limited control and transparency over underlying investments. The Fund may invest in portfolio companies indirectly through investments in SPVs. Investors should be aware that the use of SPVs introduces additional layers of structural complexity, and additional risks related to liquidity, transparency, and valuation may exist. The Fund is non-diversified and may concentrate investments in a limited number of issuers, increasing exposure to losses. Investments may be subject to market, leverage, valuation, foreign and emerging markets, regulatory, and conflict-of-interest risks, and may be adversely affected by economic conditions, interest rate changes, geopolitical events, or market disruptions. There can be no assurance that the Fund will achieve its investment objective or generate returns.
Paralel Distributors LLC, Member Firm.
- As of February 28, 2026.
- As of December 31, 2025. Data provided by PitchBook, Morningstar Indexes, CB Insights, and PWC. Based on Morningstar Pitchbook Global Unicorn Index.
- As of December 31, 2024. Data provided by Bank of America, PitchBook and World Bank Group.
- As of December 31, 2025. Data provided by Pitchbook, Morningstar Pitchbook Unicorn Index, Bloomberg.
- A J-curve is a graphical representation of the typical performance trajectory of a fund, where net cash flows are negative in the initial years due to fees and investment costs, followed by a sharp increase in returns in later years as investments mature and are exited.
- Correlation in finance is a statistical measure (ranging from -1.0 to +1.0) defining how two securities move in relation to each other.