The market for trading private stocks continues to grow, with the greatest interest in consumer-web and social startups.
The IPO market may have regained its footing--sort of--but clearly not fast enough for some wanting to sell their private shares.
Trading on SecondMarket soared 55 percent in 2011 to a total of $558 million in transactions, as ex-employees, founders and others connected with hot startups cashed out shares. The company creates a marketplace for stock in private companies.
Demand, meanwhile, was huge, with those trying to buy private shares--measured by what SecondMarket calls "indications of interest"--offering more than $6 billion during the year.
SecondMarket says it's now completed more than $1 billion in private company trades since launching the market three years ago.
SecondMarket's year-end report doesn't break specify the value of private stock in specific companies. Instead, it rather coyly breaks out activity by types of companies and lists the companies "most watched" by its investors and those startups on the rise.
Trading in consumer Web and social media companies were the clear leader, making up more than 61 percent of all trades. Not surprisingly, Facebook, which is expected to go public this spring was the most traded private company, as has been the case since this market launched in 2009.
The bulk of the sellers on SecondMarket--almost 80 percent--were former employees, while the buyers included asset managers, hedge funds and private equity funds.
No surprise as to the other "most watched" VC-backed companies in 2011, which included Twitter, Foursquare and Spotify, which wasn't on the list last quarter.
Leading the list of rising stars on SecondMarket: Pinterest, the site that lets people create virtual pinboards. The Andreessen Horowitz backed startup became a top-10 social site at the end of 2011. The second and third among the rising stars were health care startups--PracticeFusion and ZocDoc.
Another Andreessen Horowitz backed startup, the e-tailer Fab.com, topped the list of "newbies," defined as startups that began the fourth quarter with fewer than 10 watchers but quickly gained traction.