Private Markets Surpass $18 Trillion, Redefine Global Investment Landscape

The private markets sector is undergoing significant transformation in 2025, characterized by the convergence of public and private markets, expansion in private credit, and evolving investor demands for access, transparency, and liquidity. Morningstar CEO Kunal Kapoor highlighted the growing interest of retail investors in private equity and noted the surge in private credit assets, particularly through interval funds, as a key opportunity for advisors. Globally, private markets are expanding rapidly, with projections showing growth from $18 trillion in 2024 to over $29 trillion by 2029, driven by institutional investors and regional players like those in the Middle East who are increasing allocations and pushing for governance reforms. Despite recent market volatility affecting traditional safe havens, private equity remains resilient due to its structural insulation from short-term shocks and alignment with long-term economic trends, especially in sectors like defense and artificial intelligence. However, the sector is entering a new era of cautious optimism, marked by recalibrated valuations, slower venture capital deployment, heightened scrutiny on governance, and a strong demand for liquidity through secondary markets. Overall, private markets are evolving with more selective fundraising, stricter lending terms, and a strategic focus on sustainable growth amid persistent economic uncertainty.