Five Trends In Private Capital Fund Formation And Investment

In 2023, private capital pooled funds continued to be an excellent vehicle for investors to invest in different asset classes while allowing for diversity of investments. Last year, fund sponsors continued to raise large amounts of cash to deploy. The industry is expecting growth over the coming years in each of the major asset classes, with Preqin estimating that US$24.5-trillion will be invested in the alternative industry by 2028. Below, we've highlighted some of the most significant developments in private capital funds in 2023:

1. Fundraising Challenges. While large, established sponsors are still able to raise substantial funds, there is a general trend that it is an increasingly difficult fundraising environment, especially compared to 2020 and 2021. In fact, it has been dubbed by one Bain & Company private equity consultant as "the most difficult fundraising environment ever." That statement needs to be put into perspective given the growth of funds over the