💰 PE’s Evergreen Shift

Welcome to this week's Capital Call - your Wednesday dose of private market insights without the jargon. At OneFund, understanding market shifts is crucial for making informed investment decisions.

Pour yourself something nice and dive in. 

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📈 MARKET MOVERS

• 🇬🇧 UK Pension Schemes Double Private Market Allocations
  What changed in UK pensions? DC schemes doubled private equity allocations from £0.8 billion to £1.6 billion since the Mansion House Compact launched in 2023. Master trusts and superfunds managing millions of members committed at scale. Evergreen structures solved structural problems: no surprise capital calls, no J-curve drag, quarterly liquidity that fits actuarial modeling. The FCA approved over 30 Long-Term Asset Funds in four years, creating regulatory infrastructure. The largest pool of retirement capital in Europe is moving from near-zero to 5% PE allocations in three years. Read the details →

• 🌍 Asia PE Backs China While Western Capital Retreats
  Hillhouse Investment, EQT Asia, and Primavera Capital struck a bullish tone on China at Hong Kong's summit, betting Beijing's tech stimulus will deliver growth—even as PE deal count collapsed from 562 in 2022 to 93 through September 2025, per Preqin data. Deploy when others panic, capture upside when sentiment recovers. Asian managers with local networks and regulatory expertise see opportunities satellite investors miss. Western capital withdrew. These firms doubled down. View the analysis →

• 📈 European PE Deal Values Up 30% Despite Volume Decline
  European PE deal values increased 30% year-to-date through August despite 5% decline in transaction count, per Ropes & Gray analysis. Bigger checks, fewer deals. Managers are being more disciplined about where capital deploys. Meanwhile, secondaries exceeded $100 billion in H1 as institutions buy existing stakes at attractive valuations because they can't access new fund capacity from established managers. Evergreen structures are now opening access to $10 trillion in institutional capital that traditional closed-ended funds couldn't reach. Read the strategy →

🔍 DEEP DIVE

PE's $700 Billion Bet: Top Managers are Introducing Evergreen Structures

Private equity spent decades perfecting returns behind walls most investors couldn't breach. Ten-year lockups. Blind pool commitments. The J-curve eating returns for three years. These weren't bugs—they were features optimized for endowments that could wait a decade for distributions.

Now, leading managers are voluntarily tearing down those walls. Carlyle, Blackstone, and KKR are launching evergreen structures with quarterly liquidity—strategic positioning for the largest capital reallocation in private markets history. Evergreen funds hold roughly $700 billion today, about 5% of total private markets. Industry projections suggest this could reach $2.8 trillion by 2035 as DC pensions and wealth channels gain access.

While this all sounds great on paper, and there are many positives, when something sounds too good to be true, it usually is. One drawback of the enhanced liquidity of interval funds, for example, is that often the amount of the fund that can be redeemed in any quarter is limited, meaning that if everyone is running for the door, it could take multiple quarters to get all of your money out of the fund.

This isn’t to say that interval funds are all bad and closed-end structures are best, but it’s important to assess the fund in its entirety and look beyond flashing marketing saying there is no lock-up, because often, there may effectively be one.

🧰 TACTICAL TAKEAWAYS

• Ask what changed to make managers launch NOW. Carlyle, Blackstone, and KKR don't build new products without conviction. Launching evergreen structures requires operational investment in continuous deployment, liquidity management, and governance.

• Prioritize managers who navigated 2022-23 stress. The UK gilt crisis stress-tested evergreen structures. Funds that managed redemptions without multi-year queues demonstrated robust frameworks—proper cash buffers (5-20% of NAV), diversified subscription bases, and clear gate policies. Ask: what happened to redemption queues? How long did investors wait?

🧵 WEEKEND READS

(Because some light market analysis pairs wonderfully with Saturday coffee)

• 💡 BlackRock on Growth Debt's $35B Expansion
  BlackRock's growth debt team identifies expanding opportunities as companies stay private longer and growth equity slows. U.S. venture debt reached $35 billion in 2024; European markets grew 25% to €17 billion. Senior security with SOFR +650-850bps spreads and equity kickers deliver enhanced returns versus direct lending. Growth debt's expansion shows the PE ecosystem maturing—companies staying private need financing that doesn't dilute equity, creating opportunities across the capital structure as the asset class deepens and professionalizes. View analysis →

• 📈 Private Credit Draws Systematic Hedge Fund Capital
  Point72, Millennium, and Jain Global raising billions for private credit validates that structural alpha in private markets beats what systematic traders generate in public credit. These firms built careers on microsecond advantages and liquid markets. Now they're accepting 3-5 year lockups because risk-adjusted returns justify illiquidity. For allocators, hedge funds entering private credit blurs traditional buckets—"hedge fund" wrappers now offer vintages, lockups, and PE-like fee structures. The strategic question: do you want exposure to managers who built systematic trading expertise now applying it to private credit, or wait until their track records mature but capacity is allocated?
  Get insights →

• 🌐 Defense Sector M&A Momentum Continues
  Raymond James reports sustained defense M&A activity despite broader market volatility. Notable transactions: SilverEdge (cybersecurity/software) pending SAIC acquisition; Group W (wargaming) acquired by Systems Planning and Arlington Capital; clearAvenue (AI/ML analytics) acquired by Xcelerate Solutions and McNally Capital. PE buyers represented 55% of Q3 2025 transactions. Defense businesses offer recurring government revenue, high barriers to entry through security clearances, and resilience during economic cycles. PE's appetite for government contractors demonstrates selective deployment into sectors with structural advantages—exactly the kind of disciplined capital allocation that drives returns.
  Read strategy →

👋 WANT IN?

In these turbulent times, understanding the nuances of private market investments is more crucial than ever. Schedule a discovery call with OneFund further discuss private equity and the current market.

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The OneFund Team

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