A decade of private markets fundraising

Infrastructure has played a prominent role in the growth and diversification of manager portfolios, with the top 10 GPs raising $934bn over the past decade.

The past decade in private markets has been characterised by two interrelated trends: the dominance of the mega-funds and the diversification of GPs into adjacent strategies.

Both are evident in the below running total of closed-ended private market fundraising – covering private equity, private real estate, infrastructure and private debt – by GPs over the past ten years.

By the end of the first year of the decade, a relatively large number of GPs had raised modest-sized funds compared to today’s standards. As the decade wore on, we gradually saw the private markets fundraising realm become dominated by a few behemoths with significant footprints in several asset classes. By the end of 2019, Blackstone had raised $241 billion for private markets investing over the 10-year period, way ahead of the rest of the top five – Carlyle, KKR, Brookfield and Apollo. Yet, all five had been successful in launching strategies outside their traditional heritage.

Having traditionally specialised in real assets, Brookfield increased its exposure to private credit and special situations through its acquisition of Oaktree last year. The newly formed firm expects to raise $100 billion in its next fundraising round across its fund families.

Traditional private equity fund managers also diversified into adjacent asset classes through organic growth.

In 2017, Blackstone launched its open-ended infrastructure fund. Two years later, the firm had reached ninth place in the Infrastructure Investor 50 – the ranking of the largest infrastructure fund managers globally. KKR’s infrastructure fundraising activities moved the firm from 30th place in the 2012 listing to fourth place last year. Carlyle pursued a diversification strategy across the decade and, in 2019, it raised $2.4 billion for private debt activities and $2 billion for infrastructure. Apollo said in its investor day presentation in 2019 that 42 percent of its AUM came from funds and strategies it was not pursuing five years previously.

The totals featured in the chart are taken directly from the databases of fundraising activity on sister titles Private Equity International, PERE, Infrastructure Investor and Private Debt Investor.