Emerging Manager Report 2024

Updated on: December 17, 2024

This year’s report sheds light on the increasingly challenging landscape for private equity emerging managers. In 2024, these managers face a difficult fundraising environment, longer timelines to secure commitments, and growing expectations from Limited Partners regarding operational readiness, track record, and transparency. Despite these hurdles, there are opportunities for emerging managers who can balance exceptional deal execution with robust operational infrastructure.

Key Takeaways

• Fundraising Challenges: Capital raising remains tough, with total commitments to first-time funds dropping to $26.7 billion in the first three quarters of 2024 — the lowest in years. LPs are requiring more meetings and a stronger proof of strategy before committing.
• Track Record is Critical: LPs prioritize proven performance, team experience, and consistency. Seeded portfolios are becoming a favored strategy for emerging managers to demonstrate capabilities before launching their formal fundraise.
• Operational Excellence: LPs expect institutional-grade reporting, compliance, and transparency. Emerging managers must focus on these operational elements to differentiate themselves and earn investor trust.
• The Role of Technology: Adoption of AI and advanced reporting tools is accelerating. Emerging managers are leveraging technology to streamline operations and meet growing LP demands for data visibility.
• Support for Co-Investments: Co-investment rights remain a top priority for LPs, though many are also supportive of sustainable fee structures that allow new managers to grow and deliver performance.

The Gen II Advantage

In today’s competitive market, emerging managers cannot afford to overlook the “business of the firm.” Beyond strong investment strategies, LPs expect managers to demonstrate operational readiness, robust reporting, and the ability to scale effectively. Gen II provides emerging managers with the critical infrastructure needed to meet these expectations.

From advanced reporting capabilities to strategic support, Gen II ensures managers can focus on delivering strong returns while meeting the evolving demands of LPs. By partnering with Gen II, emerging managers gain the tools and expertise required to compete at the highest level in today’s private equity landscape.

Published on: December 17, 2024