Private markets go mainstream with rising reputational risks

As the Palais des Congrès buzzed with over 6,000 private capital professionals from around the globe, the clear message delivered at IPEM Paris 2025 was that private markets are no longer a niche investment strategy reserved for a sophisticated few. 

Private markets, already valued at $25 trillion globally, are projected to more than double to $60 trillion by 2032, according to Bain & Company, driven in part by the rise of retail investor participation. In the UK, platforms like Hargreaves Lansdown are now offering access to private equity and infrastructure funds for as little as £10,000, marking a major shift in accessibility. This democratisation is reshaping product design, distribution, and regulatory frameworks across the industry.

With the theme of ‘Winning the Long Game’, this year’s conference spotlighted two related transformative trends reshaping the investment landscape: traditional asset managers doubling down on private markets, and the accelerating convergence between public and private capital investment strategies.

From private credit and infrastructure to AI-driven deal sourcing, asset managers are scaling up their capabilities to meet growing investor demand and diversify beyond traditional public equities. The strategic pivot of large, traditionally public-market-focused firms - like BlackRock, Amundi, and Franklin Templeton - which are rapidly building or acquiring private market platforms, is particularly striking. This isn’t just about chasing yield; it’s about owning the full investment lifecycle, offering bespoke solutions across asset classes, and deepening relationships with both institutional and retail clients.

The rise of multi-strategy platforms is also changing the competitive dynamics. Large private equity funds are no longer just fund managers - they’re becoming investment ecosystems, offering co-investments, direct deals, and tailored vehicles that blur the lines between asset management and advisory.

A shift to private assets

Meanwhile institutional investors are rethinking allocation strategies. Aviva recently announced that it will commit up to 25% of its new default pension strategy to private markets, partnering with managers like KKR, Apollo, and StepStone. The move reflects growing confidence in private assets as essential to long-term retirement outcomes and aligns with the UK’s Mansion House Compact.

This move illustrates the most intellectually provocative theme discussed at the conference: “the great convergence”, or the blurring of boundaries between public and private markets, conventional and alternative assets, and institutional and wealth management solutions.

This shift is being driven by several forces, including investor demand for holistic, long-term portfolios that integrate liquidity, yield, and impact; technological innovation, enabling better data integration and risk management across asset classes and regulatory evolution, slowly opening private markets to retail and semi-professional investors.

As a result, large institutions are rethinking governance and the traditional 60/40 portfolio is being replaced by the Total Portfolio Approach (TPA), where asset allocation is dynamic, thematic, and outcome driven. CalPERS, one of the world’s largest pension funds, is exploring TPA to unify investment decisions across asset classes. CIO Stephen Gilmore advocates for a portfolio where every asset must justify its place based on overall risk-adjusted returns - enhancing transparency, collaboration, and ESG integration.

In addition, leading institutional investors are increasingly acting like GPs themselves. They have been building internal teams for direct and co-investments, and seeking value-adding origination rather than passive exposure.

The opportunity and reputational risks

As GPs and traditional asset managers continue to make the case that private assets should be core to a diversified and resilient investment strategy for all classes of investors, and as public and private assets investment models begin to converge, the winners will be those who can navigate both worlds with equal agility. For asset managers, this means rethinking product design, client engagement, and operational infrastructure. For investors, it means sharpening due diligence, expanding skill sets, and embracing new forms of partnership.

But success will also depend on clearer communications and better investor education. As private markets become more accessible to retail and semi-professional investors, the industry must do more to demystify structures, manage expectations, and build trust. Transparency, storytelling, and alignment will be just as critical as performance.

This remains a significant challenge as illustrated by the recent decision by Goldman Sachs-backed Petershill Partners to delist from the London Stock Exchange which serves as a slightly esoteric but interesting cautionary tale about the limits of convergence between public and private market strategies. Despite managing over $350 billion in partner-firm AUM and delivering strong financials, Petershill consistently traded at a steep discount to its book value.

This mirrors a broader trend: UK-listed private equity investment trusts are trading at average discounts of 15-30% to NAV, with some as wide as 45%. These persistent gaps reflect investor discomfort with opaque valuations, illiquidity, and the mismatch between private asset economics and public market expectations. Petershill’s exit - offering a 35% premium to its last closing price - highlights the challenge of translating private market value into public market confidence.