Apollo CEO Marc Rowan predicts a private markets 'shakeout'

"I like where we sit. Jamie Dimon said it, there's always going to be fraud, there's always going to be underwriting mistakes. But the question is who's a good risk manager and who's not a good risk manager. If 30% of your portfolio is in one industry and that one industry is being impacted by technology, you have not been a good risk manager."

"There will be a shakeout in the alternative investment sphere. Global instability and technological change will separate a good risk manager from the rest. While private market players were previously buoyed by structural forces, the industry's performance will now depend on the actual skills of individual firms."

Marc Rowan, CEO of Apollo Global Management, forecasts a significant shakeout in private markets driven by geopolitical instability, inflation, and technological disruption. He emphasizes that superior risk management will differentiate successful firms from those that fail. The private markets industry faces mounting pressures including liquidity concerns, private credit risks, and potential AI-related disruptions affecting software investments. Stock prices of major players like Apollo and Blue Owl have declined substantially this year. Rowan suggests that while structural forces previously supported the industry, future performance will depend on individual firms' actual management capabilities and ability to avoid concentrated sector exposure vulnerable to technological change.

Read at Business Insider