When you look up your company on Hiive or Forge, you'll see bids (what buyers will pay) and asks (what sellers want). The spread between them is not just a transaction cost — it's a measure of how much the market agrees on value.
What tight spreads tell you
A tight bid-ask spread — say, 3-5% between the best bid and lowest ask — means the market has strong consensus on value. Multiple institutional buyers and sellers agree on roughly the same price. For employees, this means the secondary market figure you see is a reliable valuation signal. OpenAI typically has spreads this tight.
What wide spreads tell you
A wide spread — 20-40% or more — signals that buyers and sellers disagree significantly on value. This usually happens when: (1) the company is early-stage with limited secondary trading, (2) there's been a significant event (funding round, restructuring) that shifted expectations, or (3) there's uncertainty about the path to liquidity. Wide spreads mean you should treat the secondary price as a range, not a point estimate.
How to interpret spreads for each company
Among the companies PrivatePulse covers, secondary spread quality varies significantly:
- OpenAI: tight spreads (< 5%). High volume, institutional buyers. Most reliable secondary signal.
- Anthropic: moderate spreads (5–15%). Growing market with consistent institutional demand.
- Stripe: tight spreads as IPO approaches. Market is pricing in an imminent liquidity event.
- SpaceX: moderate spreads (10–20%). Uncertainty about Starlink IPO timing affects pricing.
- Perplexity, Mistral, Cursor: wide spreads (25%+). Thin markets, earlier stage, limited institutional coverage.
Using spreads in PrivatePulse
PrivatePulse's Method B (secondary-implied) uses a recency-weighted average of bid, ask, and trade prices. The method applies a higher weight to trades (actual transactions) than to bids or asks (expressed interest). When the spread is wide, the confidence score for Method B drops, and the composite valuation weights other methods more heavily.
The practical takeaway: if your company has wide spreads on the secondary market, lean on Methods A (peer-multiple) and C (primary time-decay) in PrivatePulse, not just the secondary number. A wide spread is a signal that the secondary market is less informative than usual.