Private markets have exploded in size over the past decade and they’re showing no signs of slowing down. Industry estimates project private markets growing from $13 trillion today to more than $20 trillion by 2030.
Institutional investors, family offices, and high-net-worth individuals are pouring money into private equity, private debt, real estate and infrastructure. The key draws are the potential for higher returns, portfolio diversification, and a hedge against public market volatility.
But as these markets grow, so do the headaches, especially for service providers struggling to manage an overwhelming flood of complex data.
A growing data problem
Unlike public markets, where data is standardized and easy to access, private markets are a maze of unstructured, inconsistent information. General partners (GPs) and limited partners (LPs) rely on PDFs, Excel spreadsheets, and custom formats to share critical financial data. This lack of uniformity makes it tough to compile, analyze, and report information efficiently.
For asset servicers, manually reconciling data from multiple sources isn’t just tedious, it’s a recipe for errors and inefficiencies. And as private markets continue to expand, the sheer volume of data is becoming unmanageable. The pressure is on to rethink old processes and embrace technology to stay ahead.
Adding to the complexity is the growing range of asset types within private markets. From venture capital to infrastructure projects, each investment type comes with its own reporting standards, valuation methods, and operational challenges. Firms must now juggle different data formats and methodologies, making automation and standardization even more critical.
Regulations and investor demands are raising the stakes
Regulators are paying closer attention to private markets. The SEC is pushing for stricter reporting requirements, while European regulators are refining rules under the Alternative Investment Fund Managers Directive (AIFMD). This has resulted in more frequent, detailed reporting requirements that add to fund administrators’ workload.
At the same time, investors expect more transparency. LPs want real-time access to performance information, accounting data, risk metrics, as well as environmental, social, and governance (ESG) insights. They get instant financial updates in public markets and want the same from their private markets investments, ramping up the pressure on their service providers.
Private market investors are also increasingly scrutinizing data quality. They want deeper insights into portfolio performance, risk exposure, and operational efficiency. This has pushed asset servicers to not only manage data but also transform it into actionable intelligence. Those who can provide granular, accurate, and timely insights will gain a competitive edge.
Technology is the only way forward
With so much data to handle, technology isn’t just helpful; it’s essential. Many are turning to artificial intelligence (AI), machine learning, and automation to process massive amounts of unstructured data. These tools can pull key insights from documents, flag inconsistencies, and generate reports faster and more accurately than manual methods.
AI-powered platforms are also unlocking predictive analytics, giving GPs and LPs a clearer picture of portfolio performance, liquidity risks, and market trends. Meanwhile, blockchain and distributed ledger technology (DLT) are being explored to improve data integrity and streamline capital calls, distributions, and investor reporting.
That said, adopting new technology isn’t always easy. Legacy systems, data silos, and resistance to change can slow down progress. Firms need to invest not just in technology but also in workflow overhauls and employee training to maximize its benefits.
Another hurdle is integration. Many service providers are working with outdated systems that don’t easily connect with modern AI-driven platforms. Bridging this gap requires significant investment, but those who make the leap will be able to scale operations efficiently and provide better service to investors.
Adapt or fall behind
The future of private market asset servicing will be shaped by those who embrace data-driven solutions while maintaining the trust investors expect. Those who fail to modernize risk being left behind as investors gravitate toward firms that offer seamless, transparent, and efficient reporting.
The rapid expansion of private markets is a challenge, but it’s also an opportunity. By leveraging technology and driving industry-wide improvements, asset servicers can transform the way private markets operate, making them more efficient, transparent, and resilient.
They must adapt, innovate, and use data wisely, or risk being left behind in a financial world that’s moving faster than ever.
Key takeaways for Asset Servicers:
Embrace technology or fall behind: AI, automation, and data platforms aren’t optional — they’re the only way to manage growing data complexity at scale.
Build a culture of innovation: Technology alone isn’t enough — invest in training, change management, and agile workflows to maximize impact.
Prioritize data quality: Accurate, timely, and granular insights are no longer a “nice-to-have” — investors demand them.
Collaborate to stay competitive: Success will come from partnerships between fund admins, tech providers, and regulators to reshape private markets for the better.
The author is head of alliances at alternative investment solutions software firm Accelex
