A strip sale is when a fund sells part of its stake, a strip, in some or all of its companies to a secondary buyer, to return cash to its investors. The fund keeps the rest, so investors lock in some gains and still share in any further upside. The manager usually chooses the size of the strip and which companies are in it.
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In secondaries, a fund can sell a slice of every company it owns. It's called a strip sale. Say a fund's companies are valued at one billion. It sells twenty percent of each to a secondary buyer. At that value, two hundred million. That cash goes back to the fund's investors now. The fund keeps eighty percent of every company. Investors still share in any further gains. The manager usually picks the size of the slice, and which companies are in it. So why do investors care? It returns cash and locks in some gains, without selling a company outright. And everyone who stays lives with the price of that slice. Sell a slice of everything. Keep the rest.
A simple example with round numbers, not advice. Terms vary by fund.
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