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Individual investors represent an untapped opportunity for private equity fund managers worth more than $100 trillion, according to KKR.
Individual investors represent an untapped opportunity for private equity fund managers worth more than $100 trillion, according to KKR.
At the fund manager’s Investor Day this month, KKR presented new data about the size of the market opportunity for alternative investment fund managers to raise capital from individual investors.
In 2020 there are roughly $279 trillion of total potential client assets in the world for KKR, according to Scott Nuttal, KKR’s co-president and co-chief operating officer. Individual investors account for $179 trillion or about 64% of those total assets.
Individual investors are also under-allocated to alternative asset classes like private equity compared with other types of investors.
To date pension funds have invested about 30% of their assets in alternative investments. Endowments have invested 50% in alternatives. Individual investors meanwhile have invested less than 5% of their investable wealth in alternatives.
“That’s an opportunity that we think will play out over the course of the next several years that will sustain us for decades to come,” Mr. Nuttal said. "It’s a big opportunity for us going forward”.
Over the last several quarters, individuals have accounted for about 10-20% of KKR’s total fundraising, Mr. Nuttal said, and the firm has doubled the size of its team focused on serving individual clients. The company said it is also working with distribution partners to help reach individual investors.
KKR has been an important part of the Moonfare story since we began. Moonfare has offered multiple KKR funds on its platform, and Moonfare founder and CEO Steffen Pauls spent more than a decade as a member of KKR’s global private equity deal team.
A complete transcript of KKR’s Investor Day presentation is available here.
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¹ Minimum investment may vary by country and local regulation.
² Source: McKinsey "Private Markets Annual Review 2022"
³ Past performance is no guarantee of future returns.
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