Ep. 117: Scott Neuberger, Karmel Capital | Data-Driven Secondaries in Software and AI
•March 3, 2026
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Why It Matters
Karmel Capital’s data‑driven secondary strategy offers LPs a scalable way to capture upside in fast‑growing AI software firms without the costs of primary fundraising, reshaping how capital is allocated in the tech ecosystem.
Key Takeaways
- •Karmel Capital focuses on secondary market investments in AI software.
- •Uses proprietary data signals to identify durable, high‑growth companies.
- •Primarily conducts direct secondary transactions with existing shareholders.
- •Maintains a buy‑and‑hold strategy through IPOs and acquisitions.
- •Relies on extensive market analysis, not company‑provided data, for underwriting.
Summary
The episode features Scott Neuberger, managing partner of Karmel Capital, discussing the firm’s data‑driven approach to secondary market investing in later‑stage enterprise software and AI infrastructure. He explains how Karmel raises committed capital from institutions and family offices, then deploys it by buying existing equity stakes rather than leading primary rounds. Key insights include the firm’s reliance on proprietary data tools that monitor roughly 500 technology companies daily, allowing them to pinpoint firms with durable, efficient growth. Their typical deal flow comes from direct secondary transactions with existing shareholders—founders, early employees, or early‑stage investors—facilitated through a broad network of brokers and fund partners. Karmel’s underwriting process mirrors venture‑capital diligence but is conducted largely from public data and expert conversations, minimizing the need for company‑provided information. Notable examples cited are over 300 secondary transactions across 36 companies in eight years, including seven recent IPOs that the firm continues to hold for its limited partners. Neuberger emphasizes a “pro‑management” stance, seeking to add value without taking board seats, and highlights the firm’s buy‑and‑hold philosophy, aiming to stay invested through liquidity events and beyond. The discussion underscores the growing relevance of secondary markets as a strategic avenue for investors to gain exposure to high‑growth tech assets at attractive valuations, while leveraging sophisticated data analytics to enhance underwriting efficiency and generate superior risk‑adjusted returns.
Original Description
Scott Neuberger, Co-Founder and Managing Partner at Karmel Capital, shares how later-stage secondaries can provide access to high-quality technology companies. Learn how to assess capital efficiency, management quality and growth durability using data and market signals, and get a repeatable lens for evaluating technology businesses.
The conversation also sharpens how to think about AI investing over a realistic time horizon. Hear how to identify where value is likely to accrue over the next few years, why infrastructure matters in periods of rapid change and what concrete indicators suggest a credible path to liquidity in uncertain exit markets.
⏱️ Time Stamps
0:00 Intro
02:33 Meet Scott Neuberger and Karmel Capital
04:00 From operator to secondary investor
05:00 What secondary investing actually means
06:50 Direct secondary transactions explained
08:40 How secondary deal flow really works
11:00 Why shareholders sell partial positions
13:00 How Carmel underwrites without internal access
14:30 Using proprietary data to track 500 companies
16:00 Buy and hold approach through IPO
17:45 Targeting companies 2 to 3 years from exit
19:30 Why top 15 VC firms drive most venture alpha
22:00 Capital efficiency as a core metric
23:30 Evaluating management teams and investor momentum
25:00 Why high profile companies are not always the best buys
26:00 How Carmel evaluates AI risk and opportunity
27:00 AI as the “Big Bang” moment
29:00 Why AI infrastructure is the near-term opportunity
31:00 Closing thoughts and how to connect
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