Most retail investors have traditionally been locked out of private markets, not only because of regulatory limits, but because of a lack of knowledge and investments that were structured entirely to suit large organisations. There are good reasons for this: the asset classes are more complex, the amounts invested are much higher and the transactions take place in private, based on trust and an ability to act fast. But it also represents a massive, missed opportunity. Something recent regulation seeks to redress.
As Nicolas Audhoui-Darthenay, Head of Private Assets Product at Natixis Investment Managers (Natixis IM) points out: “The reality is that more than 80% of the economy is made up of companies which are not quoted or traded on public markets. This is a huge chunk of assets which individual investors haven’t been able to access until now. That’s a missed opportunity, not only for those investors, but also for regional economic development and local reindustrialisation to foster economic resilience in a potentially unstable world.”
Why private assets should be in investors’ crosshairs
Innovations, including those addressing ESG challenges, are often driven by fast-growing and dynamic companies that are privately held. These companies are typically only accessible by institutional and, to some extent, ultra-high-net-worth investors, through private asset funds.
“While the risks are higher, these kinds of companies often offer higher returns,” says Audhoui-Darthenay. In addition to rapidly-growing companies, this higher return profile can be attributed to a complexity premium (additional yield required to place complex products due to the lower number of potential buyers) and an illiquidity premium (additional yield required to place illiquid products due to the lower number of potential buyers). The addition of private assets to a portfolio can also provide diversification benefits, reducing overall volatility and downside risk.
The challenges of offering private assets to individual investors
While some family offices and high-net-worth individuals (to a lesser extent) have allocations to private assets, retail exposure (including mass affluent) is statistically zero.
Audhoui-Darthenay says: “That is incredible. If you put all pension and institutional money together, it’s the same as the sum of all private wealth. That means that half of the world’s capital is effectively being forced to sit on the sidelines, unable to invest in the companies that make up the bulk of the economy.”
Education is a significant challenge, as most individual investors have a relatively low understanding of both the risks and opportunities afforded by private assets. But the other key hurdle has been the lack of funds adapted to individual investors, if you take aside the specific cases of US Business Development Companies (BDCs) and REITs (Real Estate Investment Trust) which are very efficient but only target specific asset classes. Outside, this exception, only closed-ended funds with deterrents such as long-term illiquidity, capital calls and minimum tickets were available to investors, de facto excluding retail participants. Most mass affluent investors prefer to retain some access to their savings “just in case” – even for their long-term investments. Similarly, high minimum tickets have been a barrier.
Another deterrence is that money earmarked for private assets is often not deployed immediately. Instead, it is only called to fund a project or asset purchase when the opportunity arises. “Individual investors are not set up to get a stream of significant capital calls at short notice,” says Audhoui-Darthenay.
Asset managers have a central role to play in developing and offering suitable investment structures. Pooling investors together and giving them access to investment vehicles with the right structures, features, and management style (with a strong focus on liquidity management) can prudently solve many of the most serious burdens.
Solutions to challenges such as re-industrialisation, or social and environmental impacts, could be accelerated if the huge financing capacity of high-net-worth individuals and the mass affluent started flowing to innovative projects and companies through closed-ended structures or evergreen funds.
The changing private assets landscape around the world
The landscape is changing globally with regulations and fund structures moving in favour of individual investors.
An eye-catching shift in Europe is the relaunch of the EU’s European Long-Term Investment Funds (ELTIFs). ELTIF 2.0 provides a way for retail investors to tap private markets on a large scale for the first time. While ELTIFs originally appeared in 2015, they were not successful in their original aims with less than 10 billion Euros from individual investors in the first ten years. The requirement for ELTIF to be close-ended without any exit, even in exceptional circumstances, combined with harsh guidelines, made the ELTIF 1.0 fail its initial target.
ELTIF 2.0, which went live in January 2024, solved most of these issues. The €10,000 threshold was removed, as was the 10% exposure cap for investors with less than €500,000 in financial assets, which made it more complex for distributors.
While Europe appears to be leading the way in this area for now, other parts of the world are following fast. In the UK, Long-Term Asset Funds (LTAFs) were launched in 2021 with the aim of making it easier for retail investors, and others, to invest in assets that were historically difficult to access, including private assets. More recently the scope of LTAFs was drastically expanded by the UK’s Financial Conduct Authority (FCA) in 20242, opening these vehicles up to a greater number of retail investors, and there is a possibility that from April 2026 the FCA will allow individuals to invest in LTAFs through their Stocks & Shares ISAs (tax free accounts to encourage savings).
In the US, large private markets firms like Blackrock are pushing hard for greater access to retail investors and in August 2025 President Trump backed this initiative, signing an executive order in a philosophy of “relieving the regulatory burdens and litigation risk” for 401(k) plans (US pension plans) to invest in private markets. The US Securities and Exchange Commission (SEC) is now contemplating facilitating this access3.
Things are also progressing in the Asia-Pacific Region. In March 2025, the Monetary Authority of Singapore issued a consultation paper seeking feedback on a new regulatory framework aiming to make it easier for retail investors to access private markets4. In Hong Kong, the Securities and Futures Commission (SFC) launched a three-month consultation paper in October 2025. One of the four key proposals of the paper was a “phased approach to retail access into private markets”5.
In Australia many retail investors are already invested in private markets through their mandatory superannuation (pension) funds. However direct retail access to private markets is progressing more cautiously than in some other markets. In November 2025 the Australian Securities Investment Commission (ASIC) released REP 823, its response to its February discussion paper which explored shifting dynamics between public and private markets. While the report acknowledges the rapid growth of private markets investment and increasing retail interest it stops short of recommending broader retail access. The report highlights the risks for retail investors, particularly regarding communications to investors, valuation and liquidity risk, which is paramount with evergreen structures. It also acknowledges gaps in the data ASIC needs to “confidently supervise private capital funds” and flags a pilot data reporting program for 2026-276.
The European Union can also learn from other jurisdictions. For instance, according to Audhoui-Darthenay, “European Key Information Documents tend to be hard to read and the message is sometimes lost in overly formatted details and formulas, especially for Private Assets funds. On the other side, the Australian equivalent, the Product Disclosure Statement, is often very clear and easy to read for retail investors”.
Towards a public markets-like experience
Distribution of private asset funds to retail investors requires careful consideration. High-net-worth individuals are often served by private banks and financial advisors, which assess the suitability and allocation, and provide access to strategies. As such, they have a key role to play, in particular in bringing innovation from asset managers to their clients, together with advice and education on private assets, structures and potentially tax breaks available.
It is incumbent on asset managers to ensure that the retail segment also benefits from a process which is largely frictionless and efficient: liquidity windows, money at work immediately, simplicity of subscription and redemption, transparent and synthetic reporting...
“The aim is to provide an experience similar to investing in a publicly listed vehicle,” says Audhoui-Darthenay. “Investing in private assets should be a simple process: the investor pays cash and immediately gets exposure to the targeted private asset class”. Most complexities like deployment, cash drag, liquidity and flow management are to be managed by the asset manager, leveraging its expertise, access to transactions (buy or sale), its modelling capabilities and the pooling of assets and investors which makes it all possible.
Retail investors demand a range of asset types
Alongside their public markets investments, retail investors expect a range of different private asset types and strategies in order to diversify their allocations.
“The emergence of retail investors as a major allocation force in private markets will benefit investment houses that can package a range of private assets and offer diversified portfolios,” says Audhoui-Darthenay.
Multi-affiliate investment firms like Natixis IM will have an advantage, he believes. Audhoui-Darthenay points to Natixis IM’s expertise in global private equity, private debt, infrastructure, real estate or nature-based projects.
“As an asset manager, you need technical excellence in each of the private asset classes, with access to the best opportunities and a network of trusted partners and providers. This is exactly what Natixis IM brings with its strong focus and identity in each of its respective strategies. You also need the structuring and modelling skills to design the right cash-flow and/or liquidity profile, together with in-depth tax, legal and regulatory knowledge. It is key to understand such complexities and to match the underlying assets with the wrapping structure to avoid industrial accident such as liquidity suspension. Some recent examples of such suspension of liquidity in the US should act as a warning to investors to pay strong attention to how liquidity is managed, together with valuation’s reliability.”
One very important point though: even if private assets funds can now offer all the same features as public market funds, they should not be treated the same. “We don’t want to make fake promises to investors” says Audhoui-Darthenay. “Private assets are by nature long-term assets. Private assets retail funds also have liquidity restraints such as lock-up periods and gates (or redemptions limits or limited liquidity windows, names differ depending on the structure).
Furthermore, their redemption windows are not daily but likely to be monthly or quarterly, and the recommended holding period is also likely to be between 8 and 10 years to really benefit from value creation.”
Natixis IM strives to structure solutions that are managing liquidity as efficiently as possible, with a liquid pocket size not too great (so that most of the allocation stays purely illiquid) while allowing sufficient buffer to honour redemptions without over-relying too much on gates, for example. “Finding the right balance between the search for diversification, performance and relative liquidity, is exactly where asset managers can help clients navigate private markets”, says Audhoui-Darthenay.
Finally, it is critical to Natixis IM that investors understand what they invest in. “Private assets are a different beast and education is crucial. That’s why we launched a Private Assets Academy, in partnership with Preqin, to help all investors grow their private assets knowledge.” Adds Audhoui-Darthenay.
Next wave is on the way
For those wondering when retail investors can finally allocate to private assets, the answer is: now.
"The last four or five years have seen an increase in high-net-worth investors allocating to private assets"7, Audhoui-Darthenay says, and asset managers such as Natixis IM are ready for the next wave.
“High-net-worth allocations are still in their formative stages. In the next five years, we expect these allocations to be turbo-boosted by cash from mass retail investors, who are likely to be the drivers of private markets for decades to come.”
Updated February 2026
