As LPs and GPs from around the globe reconvened in Paris in September 2024, IPEM and Alix Partners surveyed attendees to take the pulse of where the market is heading into 2025.
Our findings give an insight into how the 1,218 LPs in IPEM’s network are appraising their investment options and looking to uncover the right opportunities in a complex and crowded market, as well as what GPs can do to hone their strategies and appeal to investors.
The results of the survey exploring allocation and fundraising expectations for 2025 paint a picture of a challenging fundraising market, albeit one that has improved from the previous year as an uptick in exits has provided liquidity and deal activity has picked up.
A higher percentage of GPs are fundraising this year compared to 2024, a third of which have already held a first close in the previous 12-18 months. This is close to double the number of GPs raising having held a first close from the 2024 survey, highlighting the protracted nature of fundraising at the moment.
LPs heading to the Paris conference indicated investment intentions of more than €110bn in 2025, but commitment pacing was down on 2024, with more LPs planning to deploy €20m-100m than last year (28.5% vs 25% in 2024), and fewer LPs expecting to allocate €500m+ (9% vs 10.4%) and €100m-500m (22.1% vs 27%). In combination with an increased re-up rate, the outlook for GPs looking to raise from new LPs looks challenging for the coming year.
LPs have indicated that the three key considerations in the due diligence process are consistency of returns, absolute performance, and value creation approach. Managers able to clearly articulate their strengths in these areas are likely to fare better in the current climate.
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