Giving retail investors access to private equity

IN THE last couple of years, a new breed of private equity firms has been quietly securing liquidity from a previously untapped pool of investors. Historically, private assets have been restricted to institutional investors due to the significant capital outlay required to participate in such off-market deals. These new entrants have, however, opted to buck the trend of traditional legacy giants, aiming to give ordinary people access to the sequestered private markets space.

By leveraging technology, fundraising firms such as Moonfare, Cadre and Crowdstreet have created online platforms where clients can easily browse and invest in private equity deals ranging from real estate and debt funds to hedge funds and venture capital.

This ability to digitally aggregate capital has meant that the millions in unit currency typically required to participate in such private investments have now been reduced to mere thousands. The total quantum required to participate in private assets has not changed; it is simply that a high volume of small ticket sizes is equivalent to one large ticket amount.