Private Market Funds:
A Round the World Review
June 2026
The first quarter of 2026 began in much the same way as 2025 and, for that matter, 2024 as well. The alternatives industry is still waiting for the long-promised return of realizations and an accompanying recovery in fundraising.
While closed-end fundraising in North America did edge up slightly to $432 billion last year, Europe and APAC experienced a 41% and 49% fall, respectively1.
In addition to the wider market-based headwinds, Europe’s notable year-on-year decline can be partially explained by a slew of mega-funds closed in 2024, including vehicles managed by EQT, Apax, Cinven, and Partners Group, followed by a relative dearth in 2025.
Meanwhile, the APAC region has been impacted by geopolitical tensions, particularly between China and the U.S., which has, among other things, significantly reduced the investments by U.S. investors in China-focused funds.
Furthermore, with average fundraising timelines still at 18.5 months, down slightly from a 2024 peak of 20.7 months2, fundraising is far from back in full swing. In many respects, extended fundraising has become the new norm, and sponsors are routinely making use of creative warehousing structures and borrowing strategies to ensure that funds are not missing out on deal-making opportunities.
Bright Spots
As in prior years, there continue to be notable bright spots. Secondaries fundraising had already achieved record-breaking status by the end of the third quarter of 2025, amassing $165 billion in final closes by year-end, up by $53 billion on the previous record-breaking year of 20233. Closed-ended infrastructure vehicles also reached new highs, with $289 billion raised4.
Although some APAC jurisdictions are weathering headwinds, there are notable areas of optimism. The Japanese alternative investments market is going from strength to strength, driven by a large and buoyant economy, strong international relations, and a series of corporate carve-outs and succession-fueled deal flow.
Meanwhile, China, which had been experiencing a significant lack of exits in recent years, has started to benefit from the strong return of the Hong Kong IPO market last year, which raised HK$285 billion from 119 new listings in 20255, the highest volume worldwide.
Hong Kong IPO Resurgence:
2024 vs 2025
Source: Asia Asset Management
Bright Spots
As in prior years, there continue to be notable bright spots. Secondaries fundraising had already achieved record-breaking status by the end of the third quarter of 2025, amassing $165 billion in final closes by year-end, up by $53 billion on the previous record-breaking year of 20233. Closed-ended infrastructure vehicles also reached new highs, with $289 billion raised4.
Although some APAC jurisdictions are weathering headwinds, there are notable areas of optimism. The Japanese alternative investments market is going from strength to strength, driven by a large and buoyant economy, strong international relations, and a series of corporate carve-outs and succession-fueled deal flow.
Meanwhile, China, which had been experiencing a significant lack of exits in recent years, has started to benefit from the strong return of the Hong Kong IPO market last year, which raised HK$285 billion from 119 new listings in 20255, the highest volume worldwide.
Hong Kong IPO Resurgence:
2024 vs 2025
Source: Asia Asset Management
Continuation Vehicles
Elsewhere, exits remain muted, ticking up 5.4% globally6 from a low base. However, the value of those exits fell by over 21.2%. Continuation vehicles have continued to keep distribution wheels turning and accounted for around 20% of all exits in 20257.
Global Number of PE Exits:
2024 vs 2025
Source: S&P Global
Within the GP-led secondary market, one interesting trend to note involves growing interest in CVs in the venture capital market. Investors behind the large number of unicorns, particularly those founded many years ago, are urgently seeking liquidity and the continuation vehicle market is increasingly the solution of choice.
Continuation Vehicles
Elsewhere, exits remain muted, ticking up 5.4% globally6 from a low base. However, the value of those exits fell by over 21.2%. Continuation vehicles have continued to keep distribution wheels turning and accounted for around 20% of all exits in 20257.
Global Number of PE Exits:
2024 vs 2025
Source: S&P Global
Within the GP-led secondary market, one interesting trend to note involves growing interest in CVs in the venture capital market. Investors behind the large number of unicorns, particularly those founded many years ago, are urgently seeking liquidity and the continuation vehicle market is increasingly the solution of choice.
Co-investment
While CVs are helping to fill the void left by M&A and IPO markets, co-investors are bridging the gap left by delayed or reduced fundraising. Sponsors are raising increasing proportions of their capital on a deal by deal basis. SMAs and multi-deal co-investment vehicles are rising in volume.
However, the co-investment ecosystem is increasingly divided between those investors happy to take a passive position in a co-investment vehicle, and those who are looking to get closer to the assets through co-underwriting.
Many sovereign wealth funds and large pension plans are increasingly looking to invest directly into portfolio companies alongside the sponsor, albeit with a reduction in rights relative to a co-sponsor consortium member.
Co-investment
While CVs are helping to fill the void left by M&A and IPO markets, co-investors are bridging the gap left by delayed or reduced fundraising. Sponsors are raising increasing proportions of their capital on a deal by deal basis. SMAs and multi-deal co-investment vehicles are rising in volume.
However, the co-investment ecosystem is increasingly divided between those investors happy to take a passive position in a co-investment vehicle, and those who are looking to get closer to the assets through co-underwriting.
Many sovereign wealth funds and large pension plans are increasingly looking to invest directly into portfolio companies alongside the sponsor, albeit with a reduction in rights relative to a co-sponsor consortium member.
Fundraising Incentives
A strong pipeline of co-investment is also one of the primary incentives a GP can offer to potential fund investors in a challenging fundraising environment. Increasingly though, economic incentives through “revenue sharing” or similar economic joint-venture arrangements are being struck with anchor investors, particularly by emerging managers or established managers launching a new strategy in order to secure early momentum in a fundraising process.
Democratization
The most prominent trend in the alternatives world today is the democratization of private assets.
Democratization is significantly more advanced in the U.S. than other global markets. Much-awaited DOL guidance following an executive order decreeing that 401(k) pension plans should be able to offer private markets products, due imminently, could prove transformative.
Timeline: U.S. policy on access to alternative assets for 401(k) investors
Hover to find out more
Source: S&P Global
It is worth noting, however, that a number of large U.S. retail funds are currently facing significant redemption challenges, with exemption requests sometimes exceeding pre-set limits, resulting in restricted withdrawals.
While still a hot topic in Europe, on the ground progress remains significantly slower, in part due to the fragmented nature of the region’s retail distribution networks. The situation in Asia is less developed still.
The momentum behind democratization as sponsors level their sights at the vast retail market is undeniable, however. How these ambitions are balanced with the need to satisfy the demands of sponsors’ existing institutional investor client bases will be an interesting trend to observe throughout 2026 and beyond.
For more information on Democratization, please see our article on the Top Five Trends for the Democratization of Private Capital in 2026.
Democratization
The most prominent trend in the alternatives world today is the democratization of private assets.
Democratization is significantly more advanced in the U.S. than other global markets. Much-awaited DOL guidance following an executive order decreeing that 401(k) pension plans should be able to offer private markets products, due imminently, could prove transformative.
Timeline: U.S. policy on access to alternative assets for 401(k) investors
Click to find out more
Source: S&P Global
It is worth noting, however, that a number of large U.S. retail funds are currently facing significant redemption challenges, with exemption requests sometimes exceeding pre-set limits, resulting in restricted withdrawals.
While still a hot topic in Europe, on the ground progress remains significantly slower, in part due to the fragmented nature of the region’s retail distribution networks. The situation in Asia is less developed still.
The momentum behind democratization as sponsors level their sights at the vast retail market is undeniable, however. How these ambitions are balanced with the need to satisfy the demands of sponsors’ existing institutional investor client bases will be an interesting trend to observe throughout 2026 and beyond.
For more information on Democratization, please see our article on the Top Five Trends for the Democratization of Private Capital in 2026.
Outlook
Renewed and intensified geopolitical uncertainty in recent weeks is unlikely to accelerate private markets’ fundraising recovery, but alternative managers continue to show creativity and tenacity in their efforts. It remains to be seen, however, whether 2026 will be the year when distributions start flowing once more and the fundraising deadlock is finally broken.
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