The University of California's $200 billion investment fund accumulated nearly 30 million shares of Blue Owl Technology Finance Corp. during the first quarter, becoming one of the publicly traded business development company's largest shareholders with a 6% stake. The purchase signals institutional appetite for private credit despite market turbulence.

Blue Owl Technology's shares dropped roughly 15% in the same period as investors worried artificial intelligence could disrupt software companies receiving loans from the firm. The $1.8 trillion private credit market experienced unprecedented upheaval at the start of the year, prompting major endowment managers to reassess their exposure.

UC Investments also dramatically reduced its position in Blue Owl Capital Inc., selling about 5.9 million shares and retaining roughly 66,000. Brown's $8 billion endowment cut its Blue Owl Capital Corp. position by more than half. Blue Owl has signaled stricter lending criteria for software companies, with President Erik Bissonnette noting the company's underwriting threshold "has never been higher."