Insights

The cost of capital shapes almost every private-market decision: what gets built, what gets bought, what gets refinanced, and at what price. When borrowing was inexpensive, a wide range of business plans worked. Higher financing costs narrow that range considerably, and they do it quietly — not through a dramatic repricing, but through deals that simply never get done.

What I am watching is less the direction of rates and more the behaviour around them. Are sponsors underwriting to a realistic exit, or to a hoped-for one? Are lenders extending because the underlying business is sound, or because the alternative is a realised loss? Are equity holders being asked to contribute more capital, and on what terms?

For investors, this environment rewards patience and structure. Capital that can wait tends to be offered better terms than capital that must be deployed. That is worth remembering when an opportunity is presented as urgent.

Access to private markets has widened considerably. Investment minimums have fallen, structures have multiplied, and platforms now place opportunities in front of investors who would not have seen them a decade ago. This is genuinely useful. It is also, in my view, ahead of investor education about what these assets are and how they behave.

A private investment is not simply a public investment with a longer holding period. Valuations are periodic rather than continuous, which can make volatility look lower than the underlying economics are. Fees are layered differently. The operator's judgment matters at every stage, not just at entry.

None of this argues against private markets. It argues for slower diligence, clearer questions, and a healthy scepticism toward any presentation where the risks occupy a single slide near the end.

Retirement capital is, by construction, long-duration capital. That makes it a natural fit for assets with long holding periods — and it makes the surrounding structure unusually important, because mistakes compound over decades rather than quarters.

Three things I am watching. First, how administrators and custodians handle valuation and reporting for private assets held inside retirement accounts, since the quality of that reporting varies widely. Second, the interaction between tax-advantaged accounts and investments that generate income already sheltered by depreciation, where the benefit can overlap rather than stack. Third, liquidity planning as investors approach the point of drawing on their capital.

These are structural questions rather than market ones, which is exactly why they are easy to defer. They are also the questions where a conversation with the right professional early tends to be worth far more than a well-timed allocation later.