Private Markets Face Pivotal Moment in 2025

In Brief:

In a revealing podcast interview from the Wall Street Journal, two UBS senior executives—Kevin Kuryla, Global Head of Private Funds Group, and Jerry Pascucci, Co-Head of Unified Global Alternatives—dissect the challenging landscape of private markets. After a period of unprecedented volatility triggered by interest rate shifts and economic uncertainty, they argue we're witnessing not just a temporary slowdown, but a fundamental restructuring of how private capital is raised, invested, and distributed.

Big Picture Drivers:

• Market Volatility: Record-breaking interest rate changes disrupted traditional fundraising and deal-making models

• Allocation Challenges: Institutional investors faced complex "numerator" and "denominator" issues in portfolio management

• Democratization: Emergence of new investment structures opening private markets to broader investor bases

• Structural Transformation: Shift from institutional-only to more inclusive private market investment strategies

Key Topics Covered:

• Fundraising Dynamics: Prolonged cycles and selective investor behavior

• Wealth Management Expansion: Growing role of private clients and family offices

• Secondary Market Evolution: Rise of continuation vehicles as a key exit strategy

• Regulatory Landscape: Emerging opportunities through regulatory cooperation

Key Insights:

• Permanent Shift: Private market capital raising is fundamentally changing, not just experiencing a temporary trend

• Investor Accessibility: New structures allowing broader investor participation

• Strategic Flexibility: General partners becoming more adaptable in fund structures

• Capital Concentration: Top managers capturing significant market share

By The Numbers:

• $4 Trillion: Total dry powder in private markets

• 156 Billion: Secondary market volume in 2024

• 70%: Fundraisers taking 18+ months to complete

• 51%: Capital raised by top 10 private credit managers

Memorable Quotes:

• "It's an absolute knife fight for new capital." - Kevin Kuryla

• "There isn't a GP on earth who can afford to ignore private client capital." - Jerry Pascucci

The Wrap: 

The private markets are undergoing a critical transformation, driven by technological innovation, regulatory changes, and a more inclusive approach to alternative investments. As traditional exit strategies evolve and new investment structures emerge, the industry is positioning itself for a more dynamic and accessible future.