Navigating Private Markets: Opportunities and Challenges

Welcome back to the Alt Goes Mainstream podcast.

Today’s episode dives into a groundbreaking partnership that could change the trajectory of how the wealth channel invests into private markets.

We are joined by BlackRock’s Senior Managing Director, Head of the Americas Client Business, Co-Head of U.S. Wealth Advisory (USWA), and a member of the Global Executive Committee for BlackRock Joe DeVico and Head of Product for US Wealth & Head of Alts to Wealth Jon Diorio and Partners Group’s Partner, Co-Head of Private Wealth, Head of the New York Office, Member of the Global Executive Board, Partners Group Rob Collins to discuss their partnership on a private markets model portfolio purpose-built for the wealth channel.

Joe, Jon, and Rob discuss what Rob calls in the podcast the industry’s “iPhone moment.” This model portfolio partnership that brings together BlackRock’s private markets and technology capabilities and Partners Group's history as a pioneer in the evergreen funds space is a big moment for private markets. The partnership enables the wealth channel to seamlessly access private markets solutions, understand how it fits into a broader asset allocation model, and handles rebalancing in a turnkey fashion.

We had a fascinating discussion about this partnership and why the wealth channel needs turnkey solutions such as model portfolios. We discussed:

• Why model portfolios could be the “iPhone moment” for private markets.
• The anatomy of the partnership between BlackRock and Partners Group to create private markets model portfolios.
• How to balance personalization and customization with standardization of delivery to the wealth channel.
• How to create differentiation with private markets product offerings with different product structures.
• The mechanics of a private markets model portfolio.
• How education plays a role in advisor adoption of private markets products and model portfolios.

Thanks Joe, Jon, and Rob for sharing your wisdom and experience on public and private markets as you help bring private markets into the mainstream.

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A word from AGM podcast sponsor, Ultimus Fund Solutions

This episode of Alt Goes Mainstream is brought to you by Ultimus Fund Solutions, a leading full-service fund administrator for asset managers in private and public markets. As private markets continue to move into the mainstream, the industry requires infrastructure solutions that help funds and investors keep pace. In an increasingly sophisticated financial marketplace, investment managers must navigate a growing array of challenges: elaborate fund structures, specialized strategies, evolving compliance requirements, a growing need for sophisticated reporting, and intensifying demands for transparency.

To assist with these challenging opportunities, more and more fund sponsors and asset managers are turning to Ultimus, a leading service provider that blends high tech and high touch in unique and customized fund administration and middle office solutions for a diverse and growing universe of over 450 clients and 1,800 funds, representing $500 billion assets under administration, all handled by a team of over 1,000 professionals. Ultimus offers a wide range of capabilities across registered funds, private funds and public plans, as well as outsourced middle office services. Delivering operational excellence, Ultimus helps firms manage the ever-changing regulatory environment while meeting the needs of their institutional and retail investors. Ultimus provides comprehensive operational support and fund governance services to help managers successfully launch retail alternative products.

Visit www.ultimusfundsolutions.com to learn more about Ultimus’ technology enhanced services and solutions or contact Ultimus Executive Vice President of Business Development Gary Harris on email at gharris@ultimusfundsolutions.com.

We thank Ultimus for their support of alts going mainstream.

Show Notes
00:00 Introduction to our Sponsor, Ultimus Fund Solutions

01:18 Alt Goes Mainstream Theme Song

01:56 Introduction to Today's Episode

01:58 Groundbreaking Partnership Announcement

03:32 Welcome to the BlackRock Studio

04:05 Backgrounds of Joe and Jon from BlackRock

05:48 Rob's Background and Perspective

07:13 Why this is an iPhone Moment for Private Markets

07:55 Challenges in Private Markets Adoption

12:48 Why Now is the Right Time

16:11 The Importance of Partnership

21:51 Building a Brand in Private Markets

26:48 Evolution of Fixed Income Markets

27:10 Electronification of Private Markets

27:21 Educating the Wealth Channel

28:13 Importance of Excellent Execution

28:44 Proving Performance in Private Markets

29:27 Building the Right Solution

29:48 Client Demand for Private Market Access

30:34 Customizing Asset Allocation

31:41 Transparency in Model SMAs

32:21 Blurring Lines Between Public and Private Markets

33:12 Foundational Equity in Private Markets

34:15 Combining Public and Private Solutions

35:25 Democratization of Private Markets

36:19 Active vs. Passive in Private Markets

37:58 Challenges in Market Adoption

38:28 Scalability and Diversification

39:27 Evergreen Funds and Capital Deployment

42:03 Seismic Shift in Private Markets

42:47 Future of Private Market Solutions

49:59 Personalization in Portfolio Building

50:53 Patience and Private Markets

51:00 Final Thoughts on Private Market Innovation

54:41 Conclusion and Podcast Outro

Editing and post-production work for this episode was provided by The Podcast Consultant.