Private markets used to be an exclusive club—reserved for pensions, endowments, and other large institutions. While the return potential has always been compelling, access came with high barriers: large minimums, limited transparency, and steep costs.
That’s changing—fast.
In a recent episode of Simple, But Not Easy, we spoke with Joanna McGinley, EVP of Strategic Partnerships at PitchBook—a Morningstar company and leader in private-markets data—to unpack why private markets are booming and what it could mean for advisors and investors alike.
Private markets have now grown to nearly $16 trillion in assets under management—almost triple their size since 2015, according to PitchBook data.
Several factors are driving this shift.
For one, companies are staying private longer and reaching the scale of public firms while remaining private—drawing increased interest from allocators toward private equity or venture capital. The same is true in private credit, where more debt is being issued by private companies.
Investors are also seeking the potential for higher returns and increased diversification. As a result, demand for private investments continues to accelerate.
This evolution is fueling a broader debate about the future of portfolio construction. Will the classic 60/40 portfolio still apply a decade from now? Some believe the model may evolve into something closer to 50/30/20—with the “20” representing allocations to private assets.
While public markets still dominate in total assets, private markets now far exceed them in company count. In the US, there are roughly 4,400 publicly traded companies—compared with more than 70,000 private equity- and venture-backed firms.
That means private companies make up about 94% of the total company count. Viewed through that lens, it’s clear there‘s still ample room for growth in private markets.
This is no longer just an institutional story.
Advisors now have more tools than ever to bring private-market exposure to individual portfolios—via vehicles like interval funds, nontraded business development companies, and private credit exchange-traded funds. Big firms like Blackstone, KKR, and Apollo are aggressively leaning in, with growing shares of their managed assets held in vehicles designed for the wealth channel.
Still, none of this means private markets are a free lunch. Illiquidity, complex fee structures, and limited transparency demand careful due diligence. Benchmarking returns also remains a challenge.
“There’s tremendous opportunity—but it’s still early days,” McGinley says in the episode.
Read More on the Public/Private Convergence
https://www.morningstar.com/funds/investors-first-convergence-public-private-markets-2
https://www.morningstar.com/bonds/how-use-private-debt-your-portfolio
https://www.morningstar.com/alternative-investments/how-use-private-equity-your-portfolio
https://www.morningstar.com/alternative-investments/persistence-performance-private-equity
The author or authors do not own shares in any securities mentioned in this article.
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