Blackstone's New PE Fund for Individual Investors

One of the major obstacles facing PE firms trying to attract money from individual investors is the question of liquidity and diversification. Compared to institutions, individuals really like to get their money if they need it. According to the WSJ article, Blackstone has obliged them with a new fund it launched in January, Blackstone Private Equity Strategies (BXPE), which has pulled in some $6 billion so far.

Quarterly redemptions are allowed. But that means the fund needs consistent returns, which means avoiding long accumulations of dry powder. So far, BXPE has approached the problem by taking a wide mix of positions in other Blackstone PE deals, and even deals from outside firms.The fund has made returns of 9.2% through September, but the article reports there have been questions as to whether the strategy’s exposure to outside deals will prove as profitable as the deals from within Blackstone, because the prices the fund is paying for those outside positions seem high.

Blackstone’s expectations for BXPE remain lofty. The firm reportedly believes the fund could grow as large as its individual-based private credit and real estate funds, which have $36 billion and $55 billion in net-asset value, respectively. As PE firms continue efforts to crack the individual market as a source of new AUM growth, expect to see a range of approaches as well as trial and error in response to any strategies that don’t work out as intended.

private equity
Source: Miriam Gottfried | "Blackstone’s New Fund for the Rich Is Looking Just About Everywhere for Deals" | The Wall Street Journal | 11/13/2024 | Visit