Cloud 9fin How many private credit managers does an LP really need?
4 snips
Jan 15, 2025 In the current landscape, private credit fundraising has hit a low, yet investor optimism remains strong. There's a notable consolidation, with capital flowing to established managers while newer firms struggle. The impact of rising interest rates and potential banking deregulation poses both challenges and opportunities for these asset managers. The discussion also hints at how political shifts, like a new administration, might influence this space in the coming year.
AI Snips
Chapters
Transcript
Episode notes
Fundraising Decline
- Private credit fundraising declined for the third consecutive year in 2024, reaching $167 billion.
- This is down from $217 billion in 2023 and $231 billion in 2022, according to Preqin.
Fund Closings Decline
- The number of private credit funds closing decreased significantly in 2024, down to 107 from over 300 in previous years.
- This suggests consolidation in the market around larger, more established managers.
Investor Consolidation
- Investors are consolidating their capital with fewer private credit managers.
- They are allocating more capital to single managers instead of spreading it across multiple direct lending firms.