Another year of progress for fundraisers

The rolling five-year capital raising total for private debt’s top 50 has taken another big leap. However, the current picture is a little more challenging.

The eighth edition of our private debt ranking is the biggest yet. On the following pages, you will find all the top 50 fundraisers listed in order of capital raised over a five-year period, along with summaries of the firms’ recent activities.

The capital raised by the PDI 50’s class of 2020 is around $880 billion. This is a staggering sum, easily surpassing the $775 billion total for last year and 2018’s $700 billion. When we conducted our inaugural ranking eight years ago, the total raised by what was then the PDI 30 came to a relatively modest $322 billion.

Could next year’s rolling five-year total make it to the magic $1 trillion mark? Maybe not, since 2020 has proved to be a challenging year for those on the fundraising trail – not only in private debt but in other asset classes as well. Although investors have been quick to support dislocation funds – seeking to take advantage of mispricing on the public and private markets – fundraising has been subdued.

Understandably, investors were keen to take stock amid the health crisis and new commitments moved down the priority list. The need to conduct due diligence remotely on fund managers added another layer of complexity to the process and has unquestionably slowed things down.

So perhaps we may have to wait until 2022 for the trillion-dollar mark to be reached. One thing is clear, though: private debt has not lost its appeal. During an interactive session at our virtual Tokyo Forum in November, participants were asked whether private debt commitments would increase, decrease or stay the same in the coming period. Almost two-thirds indicated a rise, one-third thought things would stay the same, and no-one considered a decrease likely. For all the concerns over deal terms and conditions, as well as the pressures on portfolio companies that may arise from covid, private debt remains a popular option with yield-hungry limited partners.

Ares Management takes the plaudits as our ranking-topper for the second year running. We noted in our PDI 50 last year that Ares had once been as far down the list as 22nd, so it has been an impressive rise to prominence for the fund manager headed by chief executive Michael Arougheti. The Los Angeles-based firm has widened its franchise into a range of strategies and geographic markets, thereby ensuring a degree of diversification that helps it ride out the cycles.

In second place is Paris-based AXA IM Alts, jumping from fifth last year. It has been a year in which the firm undertook a restructuring of its various alternative investment capabilities into a single division led by real assets chief executive Isabelle Scemama.

Read on to find out more about the composition of the PDI 50 and what we see as some of the key themes arising from it.