Good day. The U.S. venture secondary market is growing by leaps and bounds. In this year’s first quarter, the market reached an annualized value of $112.2 billion, exceeding the value of public listings for the first time, according to data from PitchBook.

Driving that growth are some of the biggest names in venture, where capital has become increasingly concentrated among a select group of companies. In the first quarter, just 20 companies accounted for more than 80% of all secondary trading value on the trading platform Hiive. Five of those heavily traded startups—SpaceX, Anthropic, OpenAI, xAI and Anduril Industries—commanded nearly 45% of all trading value during this period.

Now some of those very same companies are expected to list publicly, putting the secondary market at a crossroads.

“If those secondary investments turn into a good public offering, that will create a lot of excitement for doing secondaries in multiple other companies,” said Manthan Shah, principal at WestBridge Capital. “That could actually expand the market.”

On the other hand, if companies trade poorly and leave late-stage secondary investors holding the bag, sentiment could turn negative.

“It won’t be the early investors that decided to hold that will be underwater. It will be the secondary buyers,” Kyle Stanford, director of U.S. venture-capital research at PitchBook, said. The data company recently released a report on the state of secondary markets.

Early results from a limited number of companies have been promising. Chip-maker Cerebras Systems’ IPO last week popped nearly 70% on the first day of trading.

While all eyes will be on the upcoming IPOs, some say that today’s expanding secondary volume will be sufficient momentum.

“It’s become an expectation that if a company is having a significant increase in value that founders and early investors are going to want liquidity,” Michael Gray, a partner focused on venture capital and growth companies at the law firm Neal Gerber Eisenberg, said. “Therefore the market is only going to grow.”

And now on to the news...

Agent overload. With the adoption of artificial-intelligence agents becoming more widespread among businesses, some of the most avid corporate users are racing to avoid the issues that come with having too many agents. Companies including Lyft, DaVita and GitLab are navigating the challenge of AI agent proliferation—hoping to tamp down on the problem without discouraging AI use, they told The Wall Street Journal. The issue, known as “AI agent sprawl,” stems partly from how easy it is for even nontechnical employees to create these independent AI bots.

Thousands of individuals have invested in private companies such as SpaceX, Anthropic and OpenAI, using online platforms meant to bring the hottest opportunities to the masses. Anthropic last week sparked widespread panic by suggesting some of the investments could be worthless. The company updated a post on its website from February that had warned investors it won’t recognize sales of Anthropic stock that haven’t been approved by its board. The new addition was a list of “unauthorized firms” that facilitated such sales.

• More: Anthropic Raising $30 Billion More as AI Labs Absorb Majority of VC Funding

An Australian startup that allows drones and aircraft to see more clearly has raised $18 million as it seeks to expand a U.S. customer base that already includes the Defense Department. Arkeus’s AI-powered platform gathers and interprets optical data from proprietary sensors, including light not visible to the human eye. Arkeus has completed its latest funding round at a valuation of $72 million, up from $10 million three years ago. Australia’s state-government owned QIC Ventures led the Series A.

Funds

Lansdowne Partners launched a venture-capital fund with a first close of $150 million to back U.K. startups.

People

Miach Orthopaedics, a developer of surgical implants to facilitate connective tissue restoration, appointed Jamal Rushdy as president and chief executive officer, succeeding Patrick McBrayer. Rushdy most recently served as CEO of Arcuro Medical.

Dust, a San Francisco-based startup building a multiplayer AI system for human-agent collaboration, landed $40 million in Series B funding. Abstract and Sequoia Capital led the round, which included participation from Snowflake Ventures.

Mantle8, a France-based natural hydrogen exploration startup, secured €31 million (about $36 million) in Series A funding led by Sandwater.

Wirestock, a San Francisco-headquartered multimodal data platform, closed a $23 million Series A round led by Nava Ventures.

Xpanner, a Santa Fe Springs, Calif.-based startup providing construction site automation through robotics and physical AI, fetched $18 million in Series B bridge funding. Korea Investment Partners led the round, which saw participation from KB Investment.

Outmarket AI, a San Francisco-based AI platform for insurance, raised $17 million in Series A funding led by Permanent Capital Ventures.

Pillar, an Italian startup building an operating system for the construction industry, completed a €12 million (about $14 million) seed round led by Earlybird Venture Capital and Base10 Partners.

Urologic Health, a startup developing a noninvasive urodynamic bladder function monitoring system, closed an $11 million seed round from investors including Edge Medical Ventures, SHD Partners and Longevity Venture Partners.

Hint, a Charlotte, N.C.-based home-management platform co-founded by Martha Stewart, launched with $10 million in seed funding. Slow Ventures led the investment, which included contributions from Montauk Capital, Tusk Venture Partners, Amplo and others.

Ranger, a San Francisco-based agentic operating system for the industrial bidding process, was seeded with an $8.4 million investment led by Bonfire Ventures.

Hacktron, a cybersecurity platform that continuously tests software for vulnerabilities, snagged $2.9 million in pre-seed funding led by Crane Venture Partners.

• SpaceX Is Aiming to Go Public on June 12 in What Stands to Be Biggest IPO Ever 

• Apple Is Making Hit Products and High Profits From Imperfect Chips
   
• How Amazon Went From an AI Also-Ran to a Real Contender
   
• The Messy Courtroom Drama Over AI’s Biggest Breakup
   
• The Blockbuster Cerebras IPO Is a Huge Bet on Nvidia Fatigue
   
• The Mysterious Crypto Judges Who Settle Polymarket Disputes

This newsletter was compiled by Matthew Strozier and Zachary Cole.

Share your tips, comments and questions: vcnews@wsj.com

The team: Matthew Strozier, Yuliya Chernova, and Brian Gormley.

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