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Number four of our five themes for 2025: “Platform excellence: How managers will win business tomorrow.” 

Even as the liquidity squeeze loosens over the coming year, it’s clear that LPs are becoming ever-more selective in the managers they back. So, while private markets retain their appeal — nearly all (96%) of respondents to a recent survey said they expected to increase or maintain their exposure to alternative assets in the next 12 months — the bar for attracting new commitments from existing and new LPs is rising. The same survey found that 88% were expecting to refuse a re-up with an existing manager. 

In today’s sophisticated market, where capital is concentrated among a smaller number of managers, only the highest quality platforms garner investor dollars. A consistent track record, low or no key person turnover, scale and diverse capabilities, and alignment with LPs are the bare minimum in today’s market. They may get a manager a foot in the door, but they are far from sufficient to secure a commitment...

The launch of the iPhone wasn’t just the debut of a new product; it was the dawn of a new paradigm. The global credit markets are undergoing their own transformation.”Christopher Sheldon, co-head of credit and markets, KKR. 

Featuring Charts

Chart of the Week: Up the Middle

February 10, 2025

Total middle market loan volume for 2024 at $51.3 billion was the highest in eight years. Source: Fitch Ratings, Lev Fin Insights.

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Chart of the Week: Wide Dispersion

February 4, 2025

BSL defaults at 3Q 2024 were more than six times those in private credit.  Source: Proskauer (Private Credit), Fitch Ratings (BSL), as of September 30, 2024.

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Chart of the Week: Privates First Class

January 27, 2025

Direct lending’s share of buyout financings now dwarfs that of the bank market. Source: LSEG LPC

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Chart of the Week: Reversal of Fortune

January 22, 2025

Three quarters of M&A activity in 2024 approached full-year volume for 2023. Source: PitchBook

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Chart of the Week: Labor on a Roll

January 14, 2025

December’s job adds topped expectations, suggesting slower Fed rate cuts. Source: WSJ, The Daily Shot

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Chart of the Week: Grade A Markets

January 7, 2025

Investment grade corporate bond spreads are near record lows. Source: Federal Reserve Economic Data (FRED) – St. Louis Fed, The Daily Shot

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Features

Private Debt Intelligence – 2/3/2025

Investors stick to less risky debt strategies Read more in ‘Private Debt Q4 2024: Preqin Quarterly Update’ Private debt fundraising was at a five-year low in 2024 despite continued investor satisfaction with the asset class’ performance, with 59% saying that investments had met expectations and a further 28% stating they had been exceeded…. Subscribe to

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Bloomberg: Leveraged Lending Insights – 2/3/2025

Record Month of January Sets Pace for a Busy 2025 January’s $186b of US institutional leveraged loan issuance was up $45.7b for an increase of 32.6% from the same month a year ago, making it the busiest January on record since Bloomberg began tracking the data in 2013. It amounted to the second busiest month…

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Middle Market & Private Credit – 2/3/2025

Fitch U.S. MM CLO Spotlight – December 2024 Click here to learn more. In the charts above, Fitch presents aggregate data for issuers in its Privately Monitored Ratings (PMR) portfolio. Fitch privately rates these issuers for asset managers…. Subscribe to Read MoreAlready a member? Log in here...

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The Pulse of Private Equity – 2/3/2025

Carveouts/divestitures as a share of all US PE buyouts by quarter Download PitchBook’s Report here. Carveouts accounted for 11.8% of all US PE buyouts in Q4 2024, a sequential quarterly increase…. Subscribe to Read MoreAlready a member? Log in here...

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Leveraged Loan Insight & Analysis – 2/3/2025

Daily Analytic: Unitranche spreads tighten sharply over the last year Unitranche pricing tightened significantly over the course of 2024, moving steadily lower in the first nine months of the year before edging higher in 4Q24…. Subscribe to Read MoreAlready a member? Log in here...

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Middle Market Deal Terms at a Glance

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