How Mega-Funds Are Reshaping Global Private Market Fundraising

PitchBook’s Q3 2025 Global Private Market Fundraising Report makes one theme hard to ignore: capital is still flowing into private markets, but it is concentrating in the hands of a relatively small group of very large managers. The fundraising environment is challenging overall, yet the biggest platforms continue to attract substantial commitments, often at the expense of smaller and emerging funds.

This is the “barbell” effect in practice: capital accumulating at the top, pressure building at the bottom, and a thinning middle.

What the data actually shows

Across strategies, the pattern is consistent. In most years, the largest 10% of funds by size have achieved bigger median step-ups in fund size than the remaining 90%. That advantage is particularly visible in real estate and private debt, and, to a lesser extent, in venture capital.

Private equity in 2025 is a partial exception. Through September 2025, the largest PE funds posted a median step-up of about 35%, while the lower 90% recorded a larger median step-up of roughly 47%. Even so, when we look at the share of funds that are larger than their immediate predecessors, the top 10% still tend to outperform the rest across most years and strategies.

Concentration is even clearer if you look at where total capital is landing. In private equity, the top five funds account for about a quarter of all PE capital raised so far in 2025. In secondaries, the effect is more pronounced: the five largest vehicles represent about 65% of capital raised, and funds larger than $5 billion make up roughly 75% of total PE capital raised in that segment.

Taken together, the data points to an industry in which a relatively small group of managers is capturing a disproportionate share of new commitments, especially in strategies where fund sizes have grown materially over the last decade.

Why LPs are concentrating their relationships

From an LP perspective, this shift is not surprising. PitchBook’s commentary highlights several practical constraints that large allocators face: portfolio governance demands are rising, internal resources are finite, and oversight expectations continue to increase. Managing a very broad roster of GP relationships is harder than it used to be.

Concentrating larger tickets with fewer managers can simplify monitoring, reporting, and due diligence. It also often improves economics. Larger, multi-fund relationships make it easier for LPs to negotiate fee terms, secure co-investment opportunities, or access specific strategies within a platform.

There is also a risk and career dimension. Re-upping with established managers who have long track records can feel more defensible than backing a newer fund in an untested niche, even if the potential upside of the latter is higher. In aggregate, that behaviour channels more capital toward the largest, best-known franchises.

The impact on smaller and emerging managers

For emerging and mid-sized managers, the environment described in the report is demanding.

First- and second-time funds face more difficulty reaching first close and building momentum, even when investment professionals have credible track records from prior platforms. Sector and geography specialists need to make a clearer case for why LPs should add another line to already crowded portfolios. Strategies that do not fit cleanly into established buckets or benchmarks can be harder to place.

PitchBook’s fundraising data shows this indirectly through fund counts. While the largest vehicles in many strategies continue to close at or above their predecessor sizes, the total number of funds coming to market and closing has declined more sharply than dollar volumes. In practice, that means a smaller set of managers is raising a larger share of overall capital, and a growing number of proposed funds are either delayed or do not reach their target.

The result is a gradual shift away from the industry’s preferred narrative of alpha from specialisation and local edge toward a more concentrated landscape in which many LP portfolios are anchored in similar large, global platforms.

Where concentration risk shows up

First, concentrated fundraising can lead to more crowded positioning. When a handful of very large funds are active in the same segments, competition for deals intensifies and outcome dispersion can narrow. This is especially relevant in buyout and secondaries, where mega-funds are frequently involved in larger, widely intermediated transactions.

Second, correlation across LP portfolios can rise. If a material share of commitments is made to the same set of funds, performance outcomes become more tightly linked. A weaker vintage for a small group of large platforms can therefore have a broader impact on institutional portfolios than in a more diffuse market structure.

Third, governance and conflict management become more important in segments such as secondaries. PitchBook notes that the largest secondary funds now account for the majority of capital raised in that strategy. When the same platforms can be present as sellers, buyers, and lenders across different transactions, the need for clear conflict policies and robust LP oversight increases.

None of these dynamics are unique to 2025, but the degree of fundraising concentration documented in the report means they are more relevant than in prior cycles.

Strategic implications for GPs

Large, multi-strategy platforms that are already in the top decile by fund size are in a position to consolidate share, provided they maintain performance and discipline on underwriting and fees. The fundraising environment described by PitchBook is supportive of such platforms continuing to raise substantial vehicles, particularly in areas like secondaries, infrastructure, and private debt.

Specialist managers with a defined edge still have room to raise capital, but the threshold for differentiation is higher. A narrow sector focus, local-market access, or a specific structural capability needs to be evidenced through realised track records and clear portfolio construction logic. The market is less forgiving of generic positioning.

For mid-sized, generalist managers, the bar is likely the highest. PitchBook’s data suggests that raising a successor fund without either the scale of a global platform or the distinctiveness of a specialist strategy has become more challenging. That does not make such models unviable, but it does mean that fund size ambitions and cost structures need to adjust to the new fundraising reality.

Could the fundraising cycle broaden again?

PitchBook’s historical framing suggests that current levels of concentration are not guaranteed to persist indefinitely. Periods in which capital flows heavily toward a small group of large managers have, in earlier cycles, been followed by phases in which LPs revisit their manager rosters, look for new sources of alpha, and reconsider the balance between scale and specialisation.

The timing and extent of any such shift will depend on performance dispersion in the current and next vintages. If the largest funds continue to deliver acceptable returns and maintain discipline, the concentration trend may remain in place. If dispersion widens and smaller or more focused managers demonstrate stronger net outcomes, LP appetite for adding differentiated relationships could increase.

For now, though, the Q3 2025 data is clear. Fundraising in global private markets has not disappeared, but it has become more selective and more concentrated. Understanding how that capital is distributed across fund sizes and strategies is increasingly important for both managers and investors who want to position themselves within the next phase of the private markets cycle.

Chief Brand & Investor Relations Officer

Sneha Dadrwal

Frequently Asked Questions

Q: What does fundraising concentration actually mean in this context?

A: It means a small number of very large funds are capturing a disproportionately high share of new commitments, while many smaller and mid-sized funds are seeing flat, delayed, or failed fundraises.

Q: If mega-funds are raising more, does that mean overall fundraising is healthy?

A: Not necessarily. Aggregate dollars can look decent even when the number of funds closing is falling. In this cycle, capital is available, but it is flowing mainly to a narrow group of large platforms rather than being broadly distributed.

Q: Why are LPs choosing to back fewer, larger managers?

A: LPs are reacting to internal constraints and governance: managing fewer relationships is operationally easier, larger tickets can improve fee terms and co-invest access, and established brands feel safer from a career-risk standpoint.

Q: What risks does this concentration create for investors?

A: It can increase correlation in portfolios, crowd capital into similar deals and themes, and raise platform risk: if a few large managers underperform or face issues, the impact on LP portfolios is wider than in a more diversified GP landscape.

Q: Is this bad news for emerging and specialist managers?

A: It is challenging, but not binary. Undifferentiated, generalist funds are under the most pressure. Managers with a clearly evidenced edge – by sector, geography, or structure – can still raise capital, but the bar for proof and clarity is much higher than in the prior cycle.

Sources

PitchBook, Q3 2025 Global Private Market Fundraising Report