Retail investors are pulling back from private equity, marking a sharp shift from the boom period of early 2024. KKR and Ares attracted less capital to their evergreen funds in the first quarter compared with a year earlier, according to FT analysis of RA Stanger data. The decline reflects growing concerns about valuations and credit quality spreading across the private capital sector.

New commitments to US evergreen private equity and venture capital funds dropped 2% from the fourth quarter and rose just 2% year-on-year—a stark contrast to the 55% YoY surge at the start of last year. Private credit took the biggest hit, with fundraising down 30% from both Q4 and the prior year. The turmoil at Blue Owl, which permanently halted redemptions at its inaugural retail fund, has shaken confidence across the broader retail market.

RA Stanger chief executive Kevin Gannon warned that alternative investment fundraising is on pace to reach $180bn in 2026, down from $211bn in 2025. “The outflow of capital from private credit is leading an overall decline,” he said. EQT executive Gustav Segerberg told shareholders the private credit issue had cost his firm more than €1bn in potential inflows. Infrastructure and real estate vehicles proved more resilient, with quarterly inflows to evergreen property funds up more than 25% year-on-year.