Smarter Structures & Rising Standards: Allocate’s March Insights from Across the Private Market Landscape
The month of March gave us a front-row seat to the evolving shape of private markets. From investor dinners and industry panels to milestone moments and masterclasses, one theme kept surfacing: LPs and GPs alike are adjusting to a new set of realities - ones that require sharper focus, tighter alignment, and smarter structures.
At Allocate, we had the opportunity to engage with hundreds of investors this month, and across those conversations, five key insights emerged:
1. AI Is Reshaping Efficiency - But Not Replacing Capital Needs
There’s a growing myth that AI reduces the need for capital. The truth is more nuanced. AI may enable leaner early-stage teams, but the cost of scaling - especially in competitive markets - is merely shifting. Capital is still required but increasingly directed toward brand, distribution, and customer acquisition instead of engineering alone.
And while early ARR growth may look impressive, many AI companies face high churn. What appears as traction may, in fact, be what Allocate CEO Samir Kaji calls “Annual Curiosity Revenue” - a reminder to dig deeper on retention and sustainability.
2. Liquidity Remains Venture’s Structural Tension Point
A persistent mismatch remains between company lifecycles and 10-year fund structures. Fortunately, creativity is increasing, from sponsor-to-sponsor and strip sales to continuation funds and secondary transactions. Liquidity innovation was top of mind at both our community dinners and in our recent Allocate Institute Masterclass. LPs increasingly prioritize reserve strategies and fund pacing models to address this tension head-on.
3. SPVs Are Back, But LPs Are Asking Better Questions
Sponsor-led SPVs are re-emerging, but so is healthy skepticism. Investors are focused on underwriting discipline, carry structures (especially in stacked SPVs), and potential adverse selection. The best LPs are asking:
Do I trust the sponsor and their incentives?
Am I seeing this deal because others passed?
What’s the real structure - common vs. preferred, and how much carry is layered in?
SPVs can offer compelling upside but require sharp diligence and sponsor alignment.
4. The Private Markets Stack Is Getting More Sophisticated
In March, Allocate crossed $1B in assets under assets and administration - a milestone we’re proud of, not because of the number alone, but because of what it reflects, increasing demand for infrastructure that supports responsible, institutional-grade private market access.
Our growing base - 250+ wealth advisors and 900+ family offices - are validating that a new stack is needed for this asset class, one that supports discovery, diligence, allocation, reporting, and liquidity in a seamless, transparent way.
5. LPs Are Evolving - Fast
Whether it was at AltsLA, around the dinner table, or in educational forums, one thing is clear: LPs are building conviction faster and in a more informed way. They’re asking more of their managers, such as around reserve and follow-on strategies, and portfolio construction. They’re navigating a crowded fundraising landscape with sharper differentiation. And they’re embracing a more flexible, tech-enabled approach to asset management as public and private markets continue to converge.
As we move into Q2, the pace of evolution is accelerating, as is the sophistication of this community. LPs and GPs are building new playbooks, grounded in discipline, relationship, and operational excellence - and we’re excited to help power that transformation.
MARKET COMMENTARY
Any opinions, assumptions, assessments, statements or the like (collectively, “Statementsˮ) regarding market condition, future events or which are forward-looking, including Statements about investment processes, investment objectives, goals or risk management techniques, constitute only the subjective views, beliefs, outlooks, forecasts, projections, estimations or intentions of Allocate Management, should not be relied on, are subject to change due to a variety of factors, including fluctuating market conditions and economic factors, and involve inherent risks and uncertainties, both general and specific, many of which cannot be predicted or quantified and are beyond Allocateʼs control. Allocate undertakes no responsibility or obligation to revise or update such Statements. Statements expressed herein may not be shared by all personnel of Allocate.