The Democratization of Alternative Investments Takes Hold
Individual investors will represent a higher proportion of fundraising for alternatives in the next 12-24 months. What channels hold the keys for asset gathering?
Retail Investors in Europe Seek Exposure to Alternatives
Private assets—traditionally available only to large and sophisticated institutional investors—are going down market in Europe. Cerulli expects individual investors to represent a higher proportion of fundraising for private markets over the next 12 to 24 months. Managers are increasing their focus on capturing new growth opportunities in wholesale channels, targeting private banks and family offices for good reason—the largest strategic pool of untapped capital remains in the hands of private individuals.
Reaching Retail Investors
High-net-worth investors’ (HNWIs’) and ultra-high-net worth investors’(UHNWIs’) interest in private assets has grown substantially in recent years; Cerulli expects this trend to continue, despite the coronavirus pandemic. Our research suggests that HNWIs’ allocations to alternatives will increase to 5% or more over the next three to five years.
Reaching these assets is largely dependent upon where retail assets are managed. According to our research, targeting family offices will be their highest distribution priority for asset managers over the next 12 to 24 months.
Private banks and wealth managers are the fourth-most-important distribution channel for private markets products: 43% of managers said that private banks represent a high opportunity and the remaining 57% said that they represent a medium opportunity. Nearly half of the private banks Cerulli surveyed will be focusing on developing their private equity offerings for mass-affluent clients over the next 12 months.
Asset Managers: Distribution Priorities for Private Equity Over the Next One to Three Years, 2021
- Fund managers should consider targeting European markets where retail clients have less exposure to private investment capabilities, such as Southern Europe
- Managers that have already developed alternative investment platforms or are in the process of doing so will find most success establishing partnership agreements with private banks
- In addition, fund managers that have direct investment capabilities are better positioned to raise assets from family offices and UHNWIs
Address Retail Investor Channels
Learn how your firm can position your alternative product lineup to gather retail assets. Cerulli’s strategic consulting service can help you assess the market, and develop pricing, distribution, and marketing models to position for success.
Meet the Team
Subject Matter Experts
André Schnurrenberger, CFA
Managing Director, Europe
André Schnurrenberger is the managing director of EMEA for Cerulli Associates and leads all research, consulting, and business activities in the region. Since joining Cerulli Associates, André has focused on wider distribution and product trends across European asset managers and has worked with some of the largest global investment firms, reviewing their product shelves, enhancing their business models, and helping them define strategies for future growth.
Prior to joining Cerulli, André spent 7 years at Columbia Threadneedle Investments, most recently as head of Business Management and Market Intelligence & Research for EMEA Distribution, and before that as Head of Performance. He held previous roles at UBS Wealth Management in Zurich and London, including Head of Investment Analytics and Performance.
Full biography here.
Justina Deveikyte, CAIA
Justina joined Cerulli Associates in February 2014 and heads the European Institutional Asset Management research practice. In her role, she is responsible for all research activities relating to institutional investors, the firm’s analysis of alternative investments, the newly created environmental, social, governance (ESG) section, and all data-science-based activities. She also contributes to multiple strategic consulting engagements and The Cerulli Edge series.
Justina is the lead author of several Cerulli reports, covering insurance, retirement, ESG, and alternative investments. Throughout her career, she has successfully developed partnerships with industry associations and has presented at several conferences and events across the Europe.
Prior to joining Cerulli, Justina was a Financial Manager and Global Analyst at Global Food Consulting; she previously has provided professional advice on banking products, including unit-linked insurance and third-pillar pension products at SEB Bank Group.
Full biography here.
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