Fidelity's recent decision to enter European direct lending highlights the competitive landscape of private credit, especially amid fundraising struggles. Despite these challenges, deal flow in the US shows signs of improvement, prompting increased allocations to private credit by investors. A key component of success in private credit is the emphasis on building relationships and brand rapport, which differs significantly from public market dynamics characterized by heightened lender conflicts. While hedge funds face barriers entering direct lending due to saturated competition among established firms, they can leverage diverse strategies within the broader private credit space to align with investor return expectations. However, launching a new direct lending fund presents significant risks; experts suggest the market has matured beyond the point where new entrants can gain traction without an established track record. This caution is echoed by recent industry consolidation activities, such as mergers among private credit firms, indicating a trend toward scale and collaboration in response to market conditions.