Private Capital Firms Pivot to Operational Efficiency Over Scale

Optimism levels are currently fractured, with 45% of respondents in EMEA expressing confidence compared to only 35% in the Americas. This divergence highlights a broader struggle with macroeconomic pressures that continue to dictate lending spreads. As traditional fundraising remains a hurdle, firms are increasingly turning to alternative liquidity structures. Continuation vehicles are projected to lead this trend, with 33% of participants identifying them as the primary driver for future liquidity, followed by hybrid fund finance and NAV financing.

Non-bank lenders are poised to capture further market territory, particularly in Europe, where 64% of respondents anticipate their continued rise. This shift coincides with a move away from generic asset growth toward hyper-specialized investment strategies. Firms managing smaller portfolios—those under $50 million in EBITDA—are leaning heavily into co-investment opportunities to secure capital, while larger players prioritize flexible commercial terms.

Technology investment has also reached a turning point. While the industry is testing AI, only 16% of firms have successfully integrated it into core knowledge management systems. Instead, nearly 40% of organizations view workflow automation as the more immediate path to increasing team capacity. According to Dipish Rai, CEO of Termgrid, the firms that integrate these technologies into everyday workflows will ultimately distance themselves from the competition. Security and data accuracy remain the primary friction points hindering faster AI adoption across the sector.