Consulting
The
12/8/23
The Challenges of Private Equity in 2024
The world of private equity, commonly referred to as private equity, continues to evolve and redefine itself over the years.
As we soon enter the year 2024, it is essential to explore the trends and challenges shaping this constantly evolving sector. In this article, we will highlight the most significant aspects of private equity for the current year.
1. Market Growth
Private equity is experiencing continuous growth, attracting more and more institutional and individual investors. In 2024, this trend is expected to continue, driven by the search for above-average returns in a low-interest-rate environment.
This is further fueled by the sector's opening up to individuals, causing the retailization of Private Equity. Indeed, the savings of individuals are attracting the interest of investment funds. Some alternative investment fund managers are even creating separate internal departments to increasingly focus on developing new distribution channels and more understandable and accessible products for these new investors.
2. The Importance of Digitalization
Digitalization plays a key role in the transformation of private equity. Fund managers are increasingly adopting innovative technologies to improve their due diligence processes, portfolio management, and performance tracking. The ability to leverage the benefits of digital solutions will be an essential asset in 2024. In fact, investors are increasingly demanding digitized and modernized experiences, thus facilitating their investments.
Moreover, the digital transformation of private equity allows investment funds to open up to retail, thus bringing in a significant new pool of investors who are increasingly open to this type of investment, as seen above.
It is in this context that InvestHub was initially developed, allowing for the digitalization of subscriptions among others. Funds can therefore open up to an infinite number of investors while keeping their team focused on important tasks.
The shift to the digital era for Private Equity was accelerated by the COVID period. Management companies, regardless of their target, can no longer turn their backs on digital solutions.
3. Responsible Investments
The issue of responsible investment is becoming increasingly central to private equity. Investors are looking to align their portfolios with stricter ESG (Environmental, Social, and Governance) objectives. Funds that integrate ESG criteria will likely be favored by investors in 2024.
Greentech is particularly attractive to investors drawn by the various challenges it addresses: new energies, clean mobility, green industry, agriculture and agri-food, sustainable construction, and the environment.
For more details, find the article “How GreenTech has become a fertile ground for startups in France” on Maddyness.
4. Regulatory Pressure
Finally, private equity faces increased regulatory pressure. Regulators are seeking to enhance transparency and oversight of the sector. Private equity players will have to adapt to new rules and constantly evolving compliance standards.
In conclusion, private equity is a constantly evolving field, and 2024 is no exception. Investors, fund managers, and industry professionals will need to be ready to tackle challenges and seize opportunities in a changing environment. Continuous market growth, digitalization, responsible investment, and regulatory pressure are all factors that will shape the landscape of private equity in the coming year.
The world of private equity, commonly referred to as private equity, continues to evolve and redefine itself over the years.
As we soon enter the year 2024, it is essential to explore the trends and challenges shaping this constantly evolving sector. In this article, we will highlight the most significant aspects of private equity for the current year.
1. Market Growth
Private equity is experiencing continuous growth, attracting more and more institutional and individual investors. In 2024, this trend is expected to continue, driven by the search for above-average returns in a low-interest-rate environment.
This is further fueled by the sector's opening up to individuals, causing the retailization of Private Equity. Indeed, the savings of individuals are attracting the interest of investment funds. Some alternative investment fund managers are even creating separate internal departments to increasingly focus on developing new distribution channels and more understandable and accessible products for these new investors.
2. The Importance of Digitalization
Digitalization plays a key role in the transformation of private equity. Fund managers are increasingly adopting innovative technologies to improve their due diligence processes, portfolio management, and performance tracking. The ability to leverage the benefits of digital solutions will be an essential asset in 2024. In fact, investors are increasingly demanding digitized and modernized experiences, thus facilitating their investments.
Moreover, the digital transformation of private equity allows investment funds to open up to retail, thus bringing in a significant new pool of investors who are increasingly open to this type of investment, as seen above.
It is in this context that InvestHub was initially developed, allowing for the digitalization of subscriptions among others. Funds can therefore open up to an infinite number of investors while keeping their team focused on important tasks.
The shift to the digital era for Private Equity was accelerated by the COVID period. Management companies, regardless of their target, can no longer turn their backs on digital solutions.
3. Responsible Investments
The issue of responsible investment is becoming increasingly central to private equity. Investors are looking to align their portfolios with stricter ESG (Environmental, Social, and Governance) objectives. Funds that integrate ESG criteria will likely be favored by investors in 2024.
Greentech is particularly attractive to investors drawn by the various challenges it addresses: new energies, clean mobility, green industry, agriculture and agri-food, sustainable construction, and the environment.
For more details, find the article “How GreenTech has become a fertile ground for startups in France” on Maddyness.
4. Regulatory Pressure
Finally, private equity faces increased regulatory pressure. Regulators are seeking to enhance transparency and oversight of the sector. Private equity players will have to adapt to new rules and constantly evolving compliance standards.
In conclusion, private equity is a constantly evolving field, and 2024 is no exception. Investors, fund managers, and industry professionals will need to be ready to tackle challenges and seize opportunities in a changing environment. Continuous market growth, digitalization, responsible investment, and regulatory pressure are all factors that will shape the landscape of private equity in the coming year.
