Globacap is a technology company that specializes in private markets. It plans to expand its private credit business this year.
Fintech clients include venture capitalists, private equity fund managers and commodities investment managers.
Globacap’s co-founder and CEO, Myles Milston, said: “We plan to target the private lending space this year.”
“We’re looking for all closed-end funds managers in alternative.”
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Milston emphasized the rapid growth and huge opportunities of the private market.
“Private markets accelerate at a faster pace than public markets at a growth of 1.7:1,” he told Alternative Credit Investor.
“Large investors such as pension funds and insurance companies currently hold an average of eight percent of their assets on private markets, with the remaining 92 percent in public markets. If you compare the number of assets that can be invested in private markets to those available on public markets, only 0.1 percent of assets are found on public markets.
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“However, investor’s approaches are changing. Particularly in the UK and EU, where there are mandates for allocating more to private markets.
“If we saw the 92 percent public markets allocation drop to 75 percent, that would be $25tn (PS19.7tn), an additional $25tn that would move into the private markets.”
Globacap provides a range services to fund managers, including automated workflow processes and investor onboarding.
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Milston stated that the changing demographics of investors in private markets is increasing the need for third party services.
He said that “historically, fund managers would have access to new capital through large investors, such as pension funds.” However, while these pension funds continue to invest in the private markets, alternative investors now seek capital from a broader channel of investors, which can include high-net worth individuals and family offices. If even 50 smaller investors come into the fund, the GP will have a heavy operating and cost burden.