‘Mainstreaming’ to Drive Retail Private Assets to $3.7T by 2030

Ignites

October 6, 2025

‘Mainstreaming’ to Drive Retail Private Assets to $3.7T by 2030  

Growing comfort with alternatives, widening access to retail investors and product innovation will drive exponential growth in the next five years, according to Cerulli Associates.  

By Sean Teehan

Retail investment in private markets is set to surge over the next five years, driven by growing investor confidence in alternatives and a wave of product innovation that is broadening access, according to analysts and asset managers.

Private markets retail assets will likely jump from the current $1.7 trillion to $3.7 trillion by early 2030, a study by Cerulli Associates found. These assets are poised to jump as access to private investments is widening for retail investors, advisors are becoming more comfortable with alternative investments, and alts allocations are growing across investment structures, said Daniil Shapiro, senior research analyst for Cerulli and lead author of the report.

"What we are seeing is the mainstreaming of private capital solutions," Shapiro said. 

Independent investment advisors surveyed for the study allocated an average of 2.7% of client investments to alternatives that aren't fully liquid, but planned to increase this to 4.1% by the end of 2027, the report found.

Advisors are increasing alternatives allocations across product structures, especially semiliquids like interval funds, tender offer funds and real estate investment trusts, Shapiro said. Wirehouses currently hold a plurality of retail alternative assets, but Shapiro predicts that advisors will overtake them in this area by 2027, he said.

Innovations to how private market investments are delivered — particularly through semiliquid products — play a large role in the rise of retail alternatives, said Shannon Saccocia, chief investment officer at Neuberger Berman's wealth division. 

Draw-down periods for private investments — which can last a decade — only work for a certain segment of retail investors, Saccocia said. But semiliquid products like interval funds provide access to alternatives and more flexibility to draw from their investments than some traditional private market closed-end funds, she said. They also offer a foot in the door for advisors to offer private investments to retail clients, she said.

"Putting them into something that perhaps is more understandable to them ... that feels more comfortable for advisors who are initially allocating into private markets," Saccocia said.

Another factor that could drive retail private market assets is the baby boomer-to-millennial wealth transfer over the next decade, Saccocia said. Younger investors tend to be more comfortable and familiar with private investments, so as the next generation of investors inherit money, they're more likely than their parents to allocate more to alternatives, she said.

Private credit investing has become more available to investors as private credit has become more available to borrowers, said Mario Favetta, relationship manager for Fuse Research. Banks have become more reticent to provide loans, as regulations have tightened in the past decade, he said. Companies that used to be able to borrow from banks are now sourcing their financing from elsewhere, which has increased private credit, he said.

"That introduces more opportunities to invest, and to a successful investor that means more alpha generation opportunities," Favetta said.

In private credit, those opportunities could include strategies like direct lending to midsize companies.

Technology advancements could also play a role in retail private asset growth, said Michael Sands, managing director of Beacon Advisory Partners. Generative artificial intelligence could increase investor buy-in for alternative investments, he said.

Leaders in the private market space would be wise to lean into GenAI as a tool for investor education, Sands said.

"GenAI can be used to help explain what investors are buying — improving education, trust, and ultimately the overall product experience," Sands wrote in an email.

But the growing popularity of retail private assets could work against asset managers, said Bryan Armour, director of passive strategies at Morningstar. The value proposition of private assets shrinks if investor interest outstrips supply, he said. 

Additionally, retail investors aren't as familiar with complex private investments, so it's likely that they will return to tried-and-true strategies during periods of market volatility, Armour said.

It remains to be seen how demand for alternative investments among retail investors may evolve as macroeconomic conditions shift, said Ross Tremblay, asset manager lead at Accenture. There are still open questions surrounding the supply of products, he said.

"Sustaining this demand requires a consistent supply of high-quality private investments," Tremblay wrote in an email. "Without that, demand alone may not translate into reliable, long-term growth."

If there's a downturn in product quality, the current rise of interval fund popularity could end up mirroring what the financial industry saw with alternative mutual funds in 2008 to 2009, said Shana Sissel, chief executive of Banríon Capital.

Back then, there was rapid growth in these kinds of funds, followed by a collapse because the market wasn't ready and asset managers weren't fully committed to the structure, Sissel said.

"It's certainly possible that we'll see significant money move into alternatives in general, I'm less confident that this will happen in private markets exclusively," Sissel wrote in an email.