UniFi by CAIA Crossing the Threshold - 14

The impact of this trend is that proportionately fewer companies that would be considered
small or mid-cap size are available in the public markets. Whereas all investors might have
had access to these growth opportunities in the past through the public markets, now only
those investors who qualify to invest in private funds are being afforded the opportunity to
access them.
Alternative Managers Look for New Pathways to Provide Access to Retail Investors
Finding pathways to access a more democratized set of investors has become a new focus
for alternative managers. Key players have launched private wealth divisions and brought
on staff dedicated to working with advisor networks and creating new products that
deliver innovative structures with lower minimums, no drawdowns, simplified tax reporting,
and regular liquidity windows.
For example, Hamilton Lane launched its advisor-focused Evergreen Fund platform in
2019 to bring private equity strategies to private wealth investors. The platform had
accumulated US$4.6 billion AUM as of September 2023.10
KKR was managing nearly US$75
billion in private wealth assets for individual investors by the end of 2023 and within this
total, their K-Series of strategies targeted at private wealth saw AUM rise to US$6.5 billion
from US$2.4 billion in 2022.11
Blackstone was one of the earliest movers in wealth. They
describe their business as having over 250 dedicated professionals aligned to their unit to
support financial advisors. Their stated goal is to expand retail capital from US$200 billion
to US$500 billion. Apollo Global Management has also started to build out their wealth
focus with a goal of raising US$50 billion in retail capital by 2026.12
Only a limited number of alternative firms have the resources and/or appetite to pursue
the wealth management channel directly, however. Many have opted instead to affiliate
with broader asset management platforms and allow those organizations that are already
well-entrenched with the wealth channel to handle the logistics, compliance, and product
creation required to access these investors. For their part, many of the largest asset
management platforms are open to these arrangements as they see opportunities to both
better serve their clients and add new product sets that can help stem margin compression.
Acquisitions have also occurred across top fund providers. For example, BlackRock
announced in June 2023 that they would be acquiring European private debt firm Kreos,13
and followed up that announcement with a US$12.5 billion megadeal to buy Global
Infrastructure Partners in early 2024.14
in the alternatives space including European private credit firm Alcentra (2022),
secondaries private equity firm Lexington Partners (2021), private real estate manager
Clarion Partners, and alternative credit manager Benefit Street Partners (2019)15
Price announced plans to buy Oak Hill Advisors in 202116
. T. Rowe
; and in 2021 Vanguard announced
a strategic partnership with HarbourVest to give qualified investors access to private equity.
10
Hamilton Lane evergreen fund reports 17%-plus gains - Alternatives Watch
11 KKR: Private wealth contribution will meaningfully increase post-2026 (privateequityinternational.com)
12 Why Private Equity Is Targeting Individual Investors | Bain & Company
13 BlackRock, Inc. to Acquire Private Debt Manager Kreos Capital
14 BlackRock Buys Private Equity Firm in $12.5 Billion Mega-Deal | Inc.com
15 Traditional asset managers race to expand private investment alternatives | Financial Times (ft.com)
16 Major Acquisitions of Alternative Asset Managers Signal Continued Outperformance - Mercer Capital
14 BUILDING A NEW WORLD
Franklin Resources announced multiple acquisitions
http://www.privateequityinternational.com http://www.Inc.com http://www.ft.com
UniFi by CAIA Crossing the Threshold

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