Carlyle Raises $20 Billion for Private Equity Secondaries Fund

Carlyle Group's AlpInvest unit has raised a record $20 billion for its latest private equity secondary fund, including $15 billion for the flagship vehicle, $3.2 billion in co-investments, and $2 billion from wealthy individual investors. This fundraising milestone reflects the growing demand for liquidity in a private equity market burdened by a slowdown in deals and IPOs, with $3.6 trillion tied up in nearly 29,000 companies as of 2024. The secondary market, which facilitates faster exits by buying stakes from investors looking to offload assets, has expanded rapidly, with assets under management increasing from $273 billion in 2019 to $601 billion in 2024, now representing 5% of global private equity. While providing liquidity, these transactions often occur at discounts to prior valuations, putting pressure on returns but offering a vital tool amid fewer exit opportunities. Carlyle's move to include private wealth vehicles broadens access to this traditionally exclusive market, signaling a shift toward more flexible and inclusive private equity investing. Experts note that secondary funds have transitioned from a niche to a well-established strategy, driven by an excess of assets and growing investor demand for quicker portfolio liquidity.