Private Equity Assets Poised to Double

Sept 30, 2024

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Private Equity Assets Poised to Double

AUM is projected to double from $5 trillion in 2024 to $10 trillion by 2029, an annualized growth rate exceeding 10%.

“Alternatives are coming of age because investors have realized that it’s okay, that this trading of liquidity for higher returns can apply beyond just the highest-octane spaces. And that means the market for what we do has grown a lot.” - Blackstone President and COO, Jonathan Gray

Future Growth Catalysts

The number of private equity firms has grown from under 500 a decade ago to over 2,000 today
Over 86% of investable businesses are privately held companies with revenues exceeding $250 million
Companies are remaining private longer, there’s a rise in take-privates, and IPO activity is stagnant

Increased Accessibility in Alternatives

Funds are shifting from traditional buyout models to perpetual funds. Blackstone’s perpetual funds represent 38% of its $1 trillion AUM
Blackstone was the first alternative asset manager to join the S&P500. Other publicly listed managers include KKR, Apollo, Brookfield and Carlyle
Over the last five years, BlackRock has invested $17 billion in private market acquisitions

Risks and Challenges

Limited exit opportunities, exacerbated by a weak IPO market, have reduced distributions to LPs from an average of 25% over the past 25 years, to 11.2% in 2023, the lowest since 2009
Macroeconomic uncertainties, including recession risks, interest rate fluctuations, and inflation, signal the end of an era of cheap debt

SOURCES

2024 Market Outlook - Blue Owl

Future of Alternatives 2029 - Preqin Forecasts

BlackRock Teases Indexes for Private Markets after Preqin Deal - Reuters

Blackstone's 80 Trillion Opportunity - Forbes

The Private Equity Industry has a Cash Problem - The Economist

A Wall Street State of Mind has Captured America - The Economist

Private Markets in a Slower Era - McKinsey Global Private Markets Review 2024

Global Private Equity Report 2024 - Bain

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