The University of California is famous for its campuses, but it also runs one of the country's biggest investment funds. Its portfolio holds roughly $190 billion across retirement, endowment and cash assets.
Private equity is a corner of investing where managers buy companies that are not on public stock exchanges. The money is usually locked up for years, so selling early takes time and often a discount.
HarbourVest Partners agreed to buy $1 billion in buyout-fund assets from the University of California. The school started the sale process earlier this year. The price was more than 10% below the assets' carrying value, according to people with knowledge of the transaction. The deal involved buyout funds tied to software and other tech-focused companies, which have become harder to sell at full value.
Campbell Lutyens, an advisory firm, helped UC's investment office manage the sale. Neither UC Investments nor HarbourVest would comment.
UC is not alone in wanting out. The market for reselling private equity stakes, known as the secondary market, has grown sharply in recent years.
Rising interest rates helped kick it off by slowing deal activity and pushing investment managers and their backers to find new sources of cash. Artificial intelligence is adding pressure now, as buyers worry about how it will affect software businesses and want a bigger cushion against that risk.
Concerns about the U.S. war with Iran have widened discounts too. The result is a very busy market. First-half 2026 brought the largest amount of secondary-market trading ever recorded: $121 billion, according to Evercore Inc.
That record covers all kinds of secondary deals, from small fund stakes to entire portfolios like the one UC sold, and it keeps climbing. The activity shows that private markets now have a working exit door, even if the door comes at a discount.
Deals for private-fund clients rose slightly, from $54 billion a year earlier to $56 billion. The overall market is setting records, but the slice serving existing investors is barely growing.
A Jefferies chart using first-half 2026 data tells the same story from another angle: portfolios run for clients fetched softer prices. Those concentrated in subscription-based software companies, a model known as software-as-a-service, drew some of the deepest discounts.
UC's private assets were worth $39 billion by market value as of mid-2025, the university's latest annual report shows. Private equity made up slightly more than half of that, so the $1 billion sale is a small slice of a large pool.
The university has been shifting toward private equity for years. Its private equity allocation grew from 5% of the total portfolio in mid-2020 to 10% by mid-2025, and that easing involves real concentration. The UC sale is a reminder that private equity is not like a stock you can sell with a click. It is a bet where you have to find a buyer, and buyers are currently asking for a larger cut.
For most investors, the closest they come to this market is through a retirement plan that holds a fund with private stakes. Even then, the value on the page is a manager's estimate, not what a buyer would pay today.
Most retirement accounts never enter this corner of the market, and the UC sale is a good reminder why. The everyday investments you can buy and sell in minutes are a luxury that even the biggest institutions do not always have.