Private equity investors grow more optimistic and venture capital outlook improves looking toward 2025

LONDON, Dec. 11, 2024 (GLOBE NEWSWIRE) — Today Preqin, the global leader in alternative assets data, tools, and insights, published its Preqin Global Reports 2025. The six reports each delve into an alternative asset class: private equity, venture capital, private debt, hedge funds, real estate, and infrastructure.

All the Global Reports deliver analysis from Preqin subject matter experts covering forecasts on fundraising, fund managers, assets under management (AUM), deals, and performance in addition to investor appetite according to the latest Preqin investor survey conducted in November 2024, with 255 participants.

By combining qualitative and quantitative perspectives, Preqin analysts offer in-depth views on alternative assets’ pivotal trends and activities. Readers can expect a comprehensive understanding of investment dynamics and insights as well as how to navigate upcoming opportunities and challenges.

Cameron Joyce, Senior Vice President, Global Head of Research Insights at Preqin, says, “The macroeconomic backdrop has proved more resilient than anticipated, with limited signs of financial stress witnessed across financial markets. As policy rates begin to ease, market sentiment has become increasingly optimistic regarding the prospects for private capital. Notably, we anticipate a revitalized dealmaking environment in 2025, helping to bolster overall activity.”

Key highlights across all six alternative asset classes:

Investors and fund managers grow more optimistic toward private equity from 2025:

Global private equity raised $482bn with 646 funds by Q3 2024. This fundraising was strengthened by increased interest from certain types of investors, especially non-institutional ones. Recent fund search data from Preqin shows that non-institutional investors, including family offices and wealth managers, are increasingly attracted to private equity funds, alongside insurance companies and asset managers.

Venture capital AUM ($3.1tn) growth slows in 2024, while exit expectations rise for 2025:

Venture capital AUM globally declined slightly to $3.1tn by Q1 2024, the latest data available. Asia-Pacific (APAC) accounted for $1.6tn, followed by North America at $1.1tn, and Europe at $0.2tn*. By Q3 2024, venture capital exits totaled 852 with an aggregate value of $112bn, continuing the downward trend from 2023 when there were 1,969 exits aggregately valued at $270bn.

Private debt investors shift to a defensive approach in 2024:

While private debt fundraising saw a substantial recovery after a slow Q1 2024, it was not enough to catch up the ground lost during those first three months of the year. This challenging fundraising environment for the asset class saw private debt investors adopt a more defensive approach as well as create a shift in the balance of power between fund managers and investors when it comes to fees.

Hedge funds return 10% globally in 2024 while proving diversification worth:

Preqin’s All Hedge Fund Index returned 10% in 2024 to Q3, or 14% at a compound annualized growth rate (CAGR). $25.5bn in hedge fund inflows in Q3 2024 resulted in $19.2bn in net subscriptions through the first nine months of the year. This single quarter, however, should for now be considered an outlier given net outflows have persisted for most of the last decade.

Global real estate deal market shows early signs of recovery in 2024:

Global real estate aggregate transaction value in North America, Europe and APAC all saw a rebound during the first three quarters of 2024, compared to same period in 2023. Meanwhile, fundraising moderated slightly in 2024, as total capital raised by the same period hit 61% of last year’s total, or $96bn.

Infrastructure dry powder as share of AUM falls to record low of 24% in 2024:

Infrastructure fundraising and deal-making remained soft in 2024 and are weighing on dry powder levels. Infrastructure dry powder, as a proportion of AUM, hit a new historical low in 2024. This AUM figure dropped 3%, or $38.5bn, over the first quarter of 2024** to 24%, compared with 35% at the end of 2020.

For more information, contact Mimi Celeste Taylor at [email protected].  

The 2025 Preqin Global Reports are available for Preqin Insights+ subscribers.

Please get in touch if you are a full-time member of the press and would like to receive a full copy of any of the following reports: private equity, venture capital, private debt, hedge funds, real estate and infrastructure.

Notes to the editors

* Preqin updated its AUM methodology in September 2024. Please reach out for more information on the update. Funds denominated in Yuan Renminbi are included in these figures, with APAC becoming the largest region by AUM in 2016 following North America leading prior to that.

** The latest data available. Preqin has a six-month lag in its AUM analysis to ensure it has as complete a dataset as possible when calculating values.

About Preqin

Preqin, the Home of Alternatives, empowers financial professionals who invest in or allocate to alternatives with essential data and insight to make confident decisions. It supports them throughout the entire investment lifecycle with critical information and leading analytics solutions. The company has pioneered rigorous methods of collecting private data for over 20 years, enabling more than 200,000 professionals globally to streamline how they raise capital, source deals and investments, understand performance, and stay informed. For more information visit www.preqin.com.

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