Fund accounting Archives

From broad exposure to specialist strategies

The real estate investment model is in a period of significant transformation. To remain competitive and effective, managers must evolve their operational models in step with the demands of an increasingly complex landscape.

Twenty years ago, real estate portfolio construction was a relatively simple exercise. Office assets accounted for the bulk of portfolio composition, topped up with a mix of other familiar real estate categories, such as retail and residential.

Pandemic lockdowns and the recent cycle of rising interest rates have changed that. Office share of real estate portfolios is around a third of what it used to be in 2008, according to Blackrock. McKinsey, meanwhile, notes that deliberate asset selection has replaced broad-based real estate exposure as the primary driver of returns performance.

The traditional real estate asset verticals of office and retail still have a role to play, but data centers, life sciences, storage, senior living, and myriad other real estate sub-sectors are now essential for driving real estate returns. Investor preference isn’t only specializing by type of asset, but also investment strategy. Core and core-plus investment strategies target IRRs in the mid-single digits to low teens. Value-add and opportunistic strategies carry greater risk, but target higher returns in the upper teens.

Investors are also broadening allocations beyond real estate equity plays into real estate credit and real estate asset-based finance (ABF) to fine-tune portfolios in line with specific risk-adjusted returns targets.

Specialist strategies require specialist structures

Today’s institutional platforms routinely span multiple specialist sectors and jurisdictions, and the portfolios they manage demand fund structures that are equally sophisticated and fit for purpose.

McKinsey notes that creative capital structuring at the asset and fund level can serve as drivers of real estate outperformance. NAV loans, continuation vehicles, structured secondaries and hybrid capital structures offer the flexibility to extend hold periods, bridge liquidity gaps and reposition portfolios.

Private real estate is also tracking the wider trend across private markets of managers running a broader spread of fund structures.

GPs are offering a wider range of fund structures, separately managed accounts, co-investment funds and evergreen investment vehicles. These structures address the specific requirements of institutional investors, and facilitate access for non-institutional investors to private real estate strategies.

Specialism adds complexity

The transition toward specialist investment strategies in real estate, and the structural flexibility required to support it, is adding meaningful layers of operational complexity for firms across the industry.

Fund accounting teams are under mounting pressure to manage a growing number of fund structures, investment strategies and global jurisdictions. As portfolio breadth increases, maintaining consistency across multiple strategies and structures becomes considerably more challenging, and the consequences of reporting errors and delays grow more significant.

Investment strategy complexity is adding operational burden for real estate back-office teams. This compounds when combined with increasing demands for LP reporting and transparency.

In all private market strategies, asset-level transparency and portfolio aggregation are becoming table stakes. LPs want to see granular, real-time data on asset performance that facilitates forward-looking decision-making, rather than retrospective, reactive portfolio management.

Upgrading the model to meet higher expectations

For a time, real estate managers were able to absorb increasing workloads by stretching legacy systems and processes, but that approach has reached its limits. As fund structures continue to proliferate, manual reconciliations become unmanageable, and the risks of reporting errors and data fragmentation escalate, making a fundamental step change in operational models not just desirable, but necessary.

Upgrading real estate models is essential. Data has to be standardized, and automation and AI leveraged to manage operational complexity.

LPs, across all private markets strategies, are adapting manager selection decisions accordingly. Reporting and accounting teams are no longer simply cost centers, but key enablers of competent portfolio stewardship and headline returns.

Managers with the capability to track valuations at both the asset and portfolio level, and to benchmark performance consistently across real estate strategies, hold a meaningful competitive advantage. Operational capability is far more than a compliance requirement; it is a reliable predictor of long-term performance success.

The benefits of scale

Building up real estate investment platforms to scale is one of the ways managers are addressing the complexity challenge. When firms reach a certain size, investment in technology, data and AI can be spread more evenly across multiple strategies and funds, unlocking economies of scale.

For mid-market players, however, ramping up platform size is not the only pathway to achieving the back-office economies of scale available to larger counterparts.

Specialization is valued in today’s market, and managers operating in lucrative industry niches will not want to trade off distinctive front office capability for back-office scale.

Partnering with a specialist third-party fund administrator allows independent real estate firms to access the geographic reach and technological capabilities of a large-scale platform, without the burden of significant upfront capital expenditure, or the need to relinquish independence by merging into a larger manager.

Alter Domus serves more than 400 real estate clients worldwide, administering US$380 billion in real estate assets across 1,250 real estate funds and separate accounts.

With a deep real estate client base and a global presence in 24 jurisdictions, Alter Domus brings both the geographic reach and asset-specific technical expertise that modern real estate managers demand. Our Integrated Global Real Estate Solution (IGRES) brings this together, layering advanced technology across a fully integrated, end-to-end administration service, from the asset level through to investors.

A single operating environment

Integrated operating environments like IGRES are designed to consolidate property-level and fund-level accounting, consolidation, investor reporting, debt administration and data integration into one reporting architecture.

This unified operating environment marks a significant departure from the back-office models that have historically definedreal estate administration. Where property managers and fund accountants once operated across disconnected systems, SPVs were tracked in isolation, and investor reporting was produced manually, a more integrated and efficient approach is now possible.

Fragmented back-office services can handle smaller, simpler portfolios, but begin to fracture as portfolios become larger and more specialized.

An integrated stack addresses this risk and empowers managers to handle higher workloads and complexity without data splitting and operational burden escalating.

Looking ahead

The real estate asset class is specializing rapidly, and operational infrastructure is emerging as a defining competitive advantage.

Specialization introduces layers of structural complexity that legacy operating models are simply not equipped to support and technology stacks assembled informally over time cannot deliver at scale.

The firms best positioned to succeed will be those that pair deep sector expertise with integrated operating models capable of delivering centralized reporting and institutional-grade transparency across even the most complex portfolios.

From Reporting to Continuous Administration

As private credit matures, investor expectations are evolving. Transparency is no longer limited to periodic reporting. Investors increasingly want visibility into yield stability, exposure shifts, and liquidity dynamics. At the same time, new structures are emerging — evergreen vehicles, insurance mandates, interval funds, and SMAs — each with different transparency requirements.

This article looks at how those expectations are changing the role of fund administration. Specifically, it explores why periodic reporting is no longer sufficient for many private credit structures, how transparency is becoming part of the investor experience, and what administrative evolution is required as managers introduce evergreen, semi-liquid, and more complex capital models.

Put simply, it is no longer just about producing reports. It becomes the layer connecting portfolio activity, cash movement, and investor transparency. The administrative model begins to shape how clearly managers can communicate performance and how confidently investors can understand it.

Closed-end credit strategies naturally align with periodic reporting. Portfolio activity occurs within defined timelines. Investors expect quarterly visibility. Administration is structured accordingly. Reporting reflects the portfolio at a point in time.

Evergreen and semi-liquid

Evergreen and semi-liquid structures change this dynamic. Capital moves continuously. Liquidity must be monitored. Yield stability becomes part of ongoing dialogue. Investors expect insight between reporting cycles, not just at the end of them. The cadence of transparency begins to mirror the cadence of the portfolio itself.

This shift is subtle but important. Visibility moves from periodic snapshots to continuous understanding. Reporting becomes less about producing information and more about maintaining clarity as the portfolio evolves. Fund administration begins to influence not just what is reported, but how consistently the strategy can be communicated.

This dynamic is particularly pronounced in private credit because performance is tied to ongoing cash generation rather than exit events. Yield stability, repayment timing, and borrower concentration all influence investor confidence. As a result, transparency is not just a reporting requirement. It becomes part of how private credit strategies are evaluated and allocated capital.

This becomes even more relevant as investor bases diversify. Insurance capital often requires more frequent exposure visibility. Evergreen investors expect ongoing transparency into yield and liquidity. Institutional allocators increasingly focus on concentration and downside protection. Each of these expectations places additional demands on administrative infrastructure.

To illustrate, let’s consider a hypothetical scenario.

Hypothetical Scenario — SummitVale Credit

SummitVale Credit launches an evergreen credit strategy alongside closed-end funds. Investors request:

monthly yield tracking

liquidity usage visibility

borrower-level exposure

forward cash projections

concentration monitoring

capital deployment tracking

The existing administrative model supports quarterly reporting for closed-end funds. Data is available, but not unified. Cash projections require modelling. Exposure updates require consolidation. Yield tracking is calculated at reporting intervals.

Reporting is produced but requires manual assembly. As the evergreen vehicle grows, operational complexity increases. Transparency becomes more dependent on interpretation rather than embedded visibility.

Investors receive the information they need, but not always in the cadence they expect. Yield stability can be explained but requires analysis. Liquidity can be estimated but depends on modelling. Exposure can be understood, but requires consolidation across vehicles.

A shift in reporting need

Nothing is technically wrong. The administrative model continues to support reporting accurately. The challenge is that investor expectations have shifted toward continuous visibility, while infrastructure remains structured around periodic reporting.

Private credit investors are not just evaluating returns in hindsight. They are assessing the consistency of income, the stability of the portfolio, and the manager’s ability to maintain visibility as structures evolve. That is particularly true in evergreen and semi-liquid strategies, where transparency becomes part of the investor experience rather than a periodic reporting exercise.

In that context, fund administration plays a bigger role than many firms initially expect. It helps determine whether transparency is assembled after the fact or embedded in the operating model itself. As strategies expand, the difference becomes more noticeable

Transparency Starts to Influence Fund Design

This shift doesn’t just affect reporting. It often begins to influence how new private credit vehicles are structured. Managers introducing evergreen strategies, insurance mandates, or interval vehicles quickly recognize that transparency requirements vary across investor types. Some require more frequent exposure visibility. Others focus on liquidity usage. Many want clarity around yield stability as portfolios evolve.

At that point, administrative infrastructure becomes part of the structuring conversation. The ability to track borrower-level exposure, monitor liquidity, and understand yield drivers continuously helps managers design vehicles that can scale. Without that visibility, transparency becomes harder to maintain as capital structures diversify.

Administrative infrastructure therefore begins to evolve. Cash tracking becomes integrated across vehicles. Exposure updates reflect portfolio activity dynamically. Yield monitoring is embedded in workflows. Reporting cadence aligns more closely with investor expectations.

Administration shifts from periodic reporting to continuous insight. Rather than assembling investor views at reporting intervals, transparency is supported by connected data that reflects the portfolio as it evolves. This allows investor communication to move alongside the strategy, rather than trailing it.

From Reporting Cadence to Operating Cadence

Over time, the distinction between reporting cadence and operating cadence begins to narrow. Portfolio activity is continuous, and investor expectations increasingly mirror that rhythm. When transparency relies on periodic consolidation, visibility naturally trails portfolio changes. When data and workflows are connected, insight can move alongside the strategy.

This doesn’t necessarily change what is reported. It changes how consistently managers can communicate what is happening within the portfolio. Administration becomes less about producing updates and more about maintaining an ongoing understanding of exposure, liquidity, and performance as structures evolve.

What This Means for Private Credit Leaders

Investor expectations increasingly align with continuous visibility. Leadership teams must understand exposure, liquidity, and yield dynamics between reporting cycles, not just at reporting dates.

This typically affects:

investor transparency requirements

reporting cadence expectations

liquidity monitoring

yield stability visibility

borrower-level transparency

confidence in evergreen and semi-liquid structures

capital raising conversations with institutional investors

At this stage, fund administration becomes part of how private credit strategies are presented to investors. The ability to provide consistent, ongoing transparency influences investor confidence and the scalability of new structures.

Administration therefore moves from periodic reporting to ongoing portfolio intelligence. The model does not just support communication — it shapes how the strategy is understood.

The Alter Domus Perspective

Alter Domus supports evolving investor expectations with administrative infrastructure designed for continuous transparency, integrated cash tracking, and borrower-level exposure visibility. By connecting portfolio activity, data, and reporting, managers gain ongoing insight into performance and the confidence to scale new private credit structures.

Visibility Becomes a Platform Issue

As private credit platforms grow, strategies rarely remain isolated. Direct lending sits alongside opportunistic credit. NAV financing is introduced. Structured capital vehicles are added. Insurance mandates enter the platform. Over time, what started as a set of individual strategies begins to operate more like a single credit platform.

This is usually the point where leadership teams start asking different questions. Not just how individual funds are performing, but how exposure is building across the platform. Where borrowers overlap. How concentration is evolving. Which structures are driving yield. How liquidity is moving between mandates.

This article looks at what happens at that stage. Specifically, how visibility challenges begin to emerge as platforms diversify, why portfolio-level oversight becomes harder to maintain, and how administrative design increasingly shapes a leadership team’s ability to understand exposure across the platform as a whole.

In the early stages, strategy-level administration works well. Each team tracks deals independently. Reporting is produced at fund level. Portfolio oversight remains manageable. Exposure across strategies is limited, and consolidation is straightforward.

The Platform Expands

As platforms expand, overlap becomes more common. Borrowers appear across strategies. Capital is deployed through different vehicles. Yield varies by structure. Exposure shifts as mandates evolve. At this stage, visibility becomes less about reporting and more about how administrative data is structured.

Leadership teams begin asking questions that cut across strategies. Which borrowers appear across multiple vehicles? Where is concentration building? How does exposure change as capital moves between mandates? Which structures are contributing most to yield?

Conceptually, these questions are simple. Operationally, they depend entirely on how administrative infrastructure is designed.

If exposure is tracked independently by strategy, platform-level visibility requires consolidation. If data structures differ across vehicles, yield attribution requires interpretation. If cash flows are monitored separately, liquidity visibility becomes fragmented.

Nothing is technically wrong. Each strategy continues to operate effectively. The administrative model supports individual funds. The challenge emerges at the platform level, where visibility depends on assembling information rather than accessing it directly.

To illustrate, let’s put together a hypothetical scenario.

Hypothetical Scenario — HarborRock Credit Partners

HarborRock Credit Partners operates three strategies:

direct lending
opportunistic credit
NAV financing

Each strategy tracks deals independently. Administration aggregates information at fund level. This provides flexibility and supports strategy autonomy.

As the platform grows, HarborRock launches a multi-strategy credit vehicle. Investors request consolidated reporting:

borrower concentration across strategies
cross-strategy exposure
yield contribution by borrower
sector concentration
liquidity exposure across vehicles

The data exists across strategies, but not in a unified structure. Consolidation requires aligning assumptions, reconciling models, and validating allocations. Reporting is produced but takes time. By the time the consolidated view is complete, the portfolio has already evolved.

At first, this isn’t necessarily a problem. The information is available. Reporting remains accurate. But visibility begins to lag behind portfolio activity. Concentration can be understood, but only after consolidation. Yield attribution is possible, but requires interpretation. Platform-level exposure becomes something that is assembled rather than observed.

This is typically when the operating model starts to feel stretched. Leadership teams move from managing strategies to managing exposure across the platform. Borrower-level concentration becomes more relevant than fund-level performance. Liquidity across mandates becomes more important than individual vehicle cash positions.

Administrative infrastructure therefore begins to shape how clearly the platform can be understood. When exposure is unified, leadership teams can monitor concentration dynamically. When fragmented, visibility naturally follows reporting cycles rather than portfolio activity.

From reporting to decision making

This is also where the conversation often shifts from reporting to decision-making. Leadership teams are no longer just reviewing performance, they are actively managing exposure across the platform. Questions around capital allocation, borrower concentration, and relative value between strategies become more frequent. Without a unified view, those decisions depend on assembling information from multiple sources. With consistent data structures, they can be made in context. The difference is subtle but important. Administration moves from supporting oversight to enabling portfolio-level decisions, particularly as platforms introduce new vehicles, co-invest structures, and insurance capital alongside flagship funds.

As platforms reach this stage, administrative models usually evolve. Exposure is tracked at borrower level across strategies. Yield attribution aligns across vehicles. Cash flows are integrated into a single framework. Reporting draws from consistent data structures.

This creates a connected view of the platform. Instead of consolidating across strategies, leadership teams can understand exposure, yield, and concentration through a single operational lens. Administration moves beyond aggregation toward portfolio intelligence.

What This Means for Private Credit Leaders

As multi-strategy platforms grow, fund administration becomes the layer that connects strategies into a coherent view. Leadership teams increasingly rely on administrative infrastructure to understand how exposure builds across vehicles and mandates.

This typically influences:

borrower concentration monitoring across strategies
cross-vehicle exposure visibility
yield attribution across structures
liquidity understanding across mandates
platform-level risk management
capital allocation decisions across strategies

At this stage, administration becomes central to understanding how the platform operates as a whole. The ability to see exposure across strategies is no longer just a reporting benefit. It becomes fundamental to how private credit platforms scale.

The Alter Domus Perspective

Alter Domus supports multi-strategy private credit platforms with unified administrative models designed for borrower-level visibility and integrated reporting. By connecting data across strategies, vehicles, and cash workflows, managers gain a coherent view of the platform and the intelligence needed to scale with confidence.

Real assets investing is at a structural inflection point. A convergence of forces – including industry consolidation, investor scrutiny, regulatory complexity, and increasing demand for real-time, asset-level transparency and integrated reporting across portfolios – is reshaping what institutional investors expect and, in turn, the operating environment for real asset managers worldwide.

This is happening at a time when higher interest rates, slower exit environments, and extended fundraising cycles are putting greater pressure on firms to manage costs while maintaining operational excellence.

For decades, real assets managers built their businesses around either internally managed or heavy shadow operational infrastructure. Fund administration, investor reporting, regulatory compliance, and operational technology were considered necessary but peripheral functions supporting the core business of sourcing deals and generating returns.

This model suited an era when regulatory frameworks were simpler and operational complexity could be managed with smaller teams. In addition, portfolios were less diversified and investor expectations were considerably more limited. Today, however, the scale and sophistication of private markets, including real assets, are expanding rapidly. Preqin’s Private Markets in 2030 Report notes that global alternative assets are projected to reach $32 trillion by 2030 –– implying a step-change in the volume, complexity, and frequency of operational processes required to support these assets at scale.

Institutional investors now expect look-through reporting, cross-asset aggregation, and near real-time performance visibility, while regulatory obligations continue to expand across jurisdictions. Taken together, operating models built for lower-complexity environment are increasingly under strain.

In response, real assets firms are reassessing how their operating models should evolve. Rather than maintaining full-service internal operational infrastructures, leading managers are exploring strategic operating partnerships that provide scalable expertise, advanced technology platforms, and global operational capabilities.

The central question is no longer whether operating models must evolve, but how quickly firms can transform to support the next phase of real assets growth without eroding margins or increasing risk.

Five Key Trends Reshaping Real Assets

1. Industry Consolidation Accelerates

Since the pandemic the private markets ecosystem has undergone an unprecedented wave of consolidation.

Major transactions – including among others the BlackRock’s acquisition of Global Infrastructure Partners, Ares Management’s purchase of GCP International, and BNP Paribas’ acquisition of AXA Investment Managers – reflect a broader shift toward scale, platform expansion and operational sophistication.

These deals are not simply about asset growth. They reflect a shift toward building global, integrated operating platforms capable of supporting increasingly complex, multi-asset investment strategies.

As firms scale, operating models designed for smaller, less complex portfolios begin to break. Fragmented manual processes, and siloed teams struggle to support global, multi-jurisdictional structures.

For managers, the cost implications can be stark. Consolidation enables larger players to spread technology, compliance, and reporting costs across larger asset bases, while maintaining institutional-grade infrastructure.

Operational scale is becoming a form of competitive advantage — not just in deploying capital, but in efficiently supporting it.

Firms that cannot replicate these capabilities internally are increasingly exploring operating partnerships to access institutional infrastructure without fully absorbing the cost of building it.

2. Fee Compression and LP Scrutiny

Institutional allocators are placing greater emphasis on improving transparency, operational discipline, and cost efficiency, driven by significantly more rigorous operational due diligence processes. Today, LPs evaluate not only investment performance strategy but also:

data accuracy and timeliness
reporting transparency and granularity
governance and control frameworks
operational resilience and scalability

According to PwC, nearly 9-out-of 10 of asset managers report experiencing profitability pressure in recent years, driven by rising costs and fee competition.

As a result, managers are expected to demonstrate:

transparent cost structures
scalable reporting systems
strong governance frameworks
efficient operational processes

Operational infrastructure has moved from a support function to a core component of investor confidence and fundraising success.

Managers that can demonstrate robust, scalable operating models are better positioned to win allocations — not just on performance, but on institutional credibility.

3. Regulatory Complexity

The regulatory landscape for real assets has grown significantly more complex over the past decade. Managers operating across jurisdictions must navigate frameworks such as AIFMD, SFDR, and evolving US and Asian reporting requirements.

This has materially increased the burden on compliance and operations teams.

For many firms — particularly those with lean teams — maintaining in-house expertise is resource-intensive. Regulatory complexity also introduces operational risk: errors in reporting, delayed filings, or inconsistent compliance can result in fines, investor concern, and reputational damage.

As regulation evolves, firms face a structural decision: build and maintain internal regulatory capability or leverage specialist partners with dedicated expertise and global coverage.

4. Extended Fundraising and Deal Cycle

Private markets are experiencing increased volatility in fundraising and transaction activity, driven by interest rate shifts, geopolitical uncertainty, and slower exit environments.

Fundraising timelines have extended, while deal velocity has declined across key real asset segments.

However, operational obligations remain constant. Managers must still deliver investor reporting, regulatory filings, and portfolio monitoring regardless of the pace of new investment activity.

This creates pressure on management company economics. Maintaining large fixed operating infrastructures during slower investment cycles can significantly impact margins.

As a result, operating model flexibility — the ability to scale resources up or down — is becoming increasingly important.

5. Technology as a Competitive Differentiator

Technology is rapidly reshaping investor expectations across the real assets. At a minimum, institutional investors expect:

digital investor portals
On-demand reporting consolidated portfolio views.

Increasingly, leading managers are moving toward:

integrated data environments
real-time analytics
cross-asset reporting capabilities

Delivering this requires significant investment in data architecture, systems integration, and cybersecurity.

Many firms underestimate not just the cost of building systems, but the ongoing cost of maintaining, upgrading, and securing them.

Managers face a structural choice: invest in proprietary systems or leverage platforms purpose-built for private markets.

The Operating Model Conundrum

Rapid change is forcing real assets firms to reassess how their operating models support their strategic priorities.

Investment teams focus on sourcing deals and generating returns. However, the infrastructure supporting these activities has become significantly more complex.

Fund accounting, investor reporting, regulatory compliance, and technology now require specialized expertise and advanced systems.

Many firms built these capabilities internally during periods of growth. Over time, however, these functions have evolved into significant fixed cost centers requiring continuous investment in people, systems, and compliance infrastructure.

These functions are mission-critical — yet rarely represent true competitive differentiation.

This creates a structural tension: critical functions that are essential to operate, but inefficient to scale internally.

The Transformation Solution: Strategic Operating Partnerships

In response, firms are increasingly adopting strategic operating partnerships.

Rather than viewing operations as a cost center, leading managers are repositioning operating models as scalable platforms that enable growth, efficiency, and risk management. These partnerships can take several forms:

operational lift-outs
co-sourcing models
fully outsourced operating platforms

When implemented effectively, these operating partnerships deliver benefits across three crucial dimensions:

a. For the Business

Strategic partnerships enable a shift from fixed to variable cost structures, improving margin flexibility.

They also provide access to multi-jurisdictional expertise that would be costly to build internally.

b. For the Technology Stack

Technology is often one of the most compelling drivers of operating model transformation. Operating platforms provide immediate access to advanced capabilities including:

investor portals
integrated reporting systems
operational dashboards
real-time data visibility

without requiring upfront capital investment or ongoing internal development costs.

c. For People

Operating model transformation expands career pathways for operations professionals.

Operations professionals within investment firms often work in highly specialized roles with limited career mobility. Within larger operational platforms, these professionals can gain exposure to a wider range of investment strategies, clients, and technologies.

Expanded career pathways and training opportunities can improve retention and professional development. When managed thoughtfully, operating partnerships can create positive outcomes for both organizations and the professionals supporting their operations.

Proven Success: Evidence from the Market

A growing body of evidence across the alternatives sector demonstrates the impact of operating model transformation.

across recent transitions, firms report improved reporting speed and accuracy
enhanced investor transparency
stronger operational resilience

Successful transformations share common characteristics:

strong leadership alignment
clear communication with stakeholders
structured transition planning

Making the Decision: A Framework for Leaders

For executives and boards evaluating operating model transformation, several core considerations should guide decision-making:

Focus internal resources on true sources of competitive advantage. Investment decision-making and investor relationships remain core differentiators. Highly specialized operational functions can often be delivered more effectively through partners.
Ensure operating infrastructure can scale with growth. As real assets allocations expand, operational demands increase in complexity and volume. Infrastructure must be able to scale accordingly without introducing inefficiencies or risk.
Prioritize risk management and operational resilience. Any operating model must be supported by strong governance frameworks, deep regulatory expertise, and robust control environments.
Plan transformation with a realistic structured timeline. Most operating model transitions are executed over a period of 12 – 18 months requiring clear planning, phased execution, and experienced delivery capabilities.
Evaluate strategic upside beyond cost efficiency. While cost considerations are important, the broader value lies in enabling leadership teams to focus on investment performance, growth, and client relationships.

Leading Through Transformation

Real assets are entering a new phase of growth and complexity.

Rising investor expectations, regulatory demands, and technology requirements are reshaping the operational foundations of the industry.

Operating infrastructure is no longer a back-office consideration — it is a core driver of scalability, efficiency, and competitive positioning.

Firms that rely on legacy operating models risk rising costs and constrained growth.

Those that proactively transform their operating models can unlock flexibility, scalability, and sharper strategic focus.

At Alter Domus, we see operating model transformation as the move toward integrated operating platforms that combine data, technology, and specialist expertise to deliver transparency, control, and scalability at institutional scale.

As the next investment cycle unfolds, firms that align their operating models with future demands will be best positioned to succeed.

A Fund-Level Model

Private credit platforms rarely scale in a straight line. Growth introduces more borrowers, more vehicles, more tranches, and more dynamic portfolio activity. What begins as a straightforward operating model gradually becomes more complex as strategies expand.

This article looks at what happens when scale starts to change how portfolios need to be understood. Specifically, it explores how administrative models designed for early-stage growth begin to stretch, why visibility becomes harder as portfolios become more dynamic, and how fund administration increasingly influences decision-making as private credit platforms scale.

In the early stages of a private credit strategy, fund-level administration is usually sufficient. Exposure is easy to understand. Cash flows are predictable. Reporting aligns closely with portfolio activity. The administrative model supports the strategy without friction.

The Platform Grows

As platforms grow, the nature of the portfolio changes. Borrowers amend facilities. Add-on tranches are layered into existing deals. Repayments occur unevenly across vehicles. Co-invest structures participate selectively. SMAs introduce different allocation requirements. Yield evolves as structures change.

Administration is no longer summarizing a stable portfolio. It is tracking a portfolio that moves continuously. That shift changes what leadership teams need to understand.

Reporting still works. Exposure is still available. But clarity begins to require interpretation. Yield drivers take longer to isolate. Allocations become more operationally intensive. Visibility follows reporting cycles rather than portfolio activity.

Nothing is technically wrong. The operating model simply wasn’t designed for portfolios that evolve continuously.

When Allocation Becomes a Moving Target

This is also where allocation starts to become more dynamic. New capital participates selectively. Co-invest vehicles sit alongside flagship funds. SMAs enter specific tranches rather than entire deals. Partial repayments flow unevenly across vehicles. Over time, exposure shifts even when no new borrowers are added.

At that point, understanding the portfolio requires more than fund-level visibility. Leadership teams need to see how capital is distributed across tranches, vehicles, and borrowers. The challenge is not tracking individual transactions, but understanding how those movements reshape exposure over time. As portfolios become more layered, allocation mechanics begin to influence how clearly risk and return can be interpreted.

To illustrate, let’s put together a hypothetical scenario.

Hypothetical Scenario — NorthBridge Direct Lending

NorthBridge Direct Lending launches with a single flagship fund and a concentrated portfolio of borrowers. Administration operates at fund level. Exposure is straightforward. Cash flows are predictable. Reporting is efficient.

Over time, NorthBridge expands. A second fund is introduced. Co-invest vehicles participate in selected deals. Insurance capital is added through SMAs. Existing borrowers receive additional tranches. Amendments become more frequent. Partial repayments occur across multiple vehicles.

The portfolio now includes:

• multiple vehicles investing in the same borrower

• tranches with different participation levels

• partial repayments across funds and SMAs

• amendments impacting allocation mechanics

• yield changing as structures evolve

• exposure shifting as new capital participates selectively

The administrative model remains structured around fund-level reporting. Exposure is available, but requires consolidation. Yield attribution is possible, but requires interpretation. Cash allocation becomes more sequential. Reporting remains accurate, but takes longer as activity increases.

The strategy continues to scale. The portfolio performs. The operating environment has simply become more dynamic, and administration plays a larger role in maintaining clarity.

When Portfolio Activity Becomes Continuous

This is typically where the operating model begins to stretch. Exposure can still be understood, but not immediately. Yield can still be explained but requires interpretation. Cash flows remain visible, but allocations become more operationally intensive.

Leadership teams often start asking different questions. How is exposure shifting at borrower level? Which tranches are driving yield? Where is concentration building across vehicles? How does capital move as new structures are introduced?

These questions are straightforward conceptually. Operationally, they depend on how administrative infrastructure is structured. When visibility is embedded, exposure can be monitored dynamically. When fragmented, understanding the portfolio requires consolidation.

As portfolios become more dynamic, administration begins to influence how quickly leadership teams can interpret change. Visibility becomes less about reporting accuracy and more about how exposure can be understood as the portfolio evolves.

From Reporting to Portfolio Visibility

As private credit platforms scale, administrative models evolve alongside the portfolio. Visibility moves from fund-level to instrument-level tracking. Cash workflows become integrated across vehicles. Exposure is monitored at borrower level. Reporting draws from consistent data structures.

This changes the role of fund administration. Rather than summarizing activity, it helps maintain a consistent view of how the portfolio evolves. Leadership teams can understand exposure shifts, yield drivers, and allocation changes in context.

Increasingly, this evolution is supported by operating models that connect data, workflows, and reporting into a single view of the portfolio. Instead of assembling exposure across systems, managers can see borrower-level positions, cash movement, and yield dynamics together. Administration shifts from periodic reporting toward continuous portfolio intelligence.

What This Means for Private Credit Leaders

As private credit platforms scale, fund administration begins to influence more than reporting. It shapes how clearly leadership teams can understand exposure, manage allocations, and monitor risk.

This typically affects:

• how quickly exposure shifts can be identified

• how easily yield drivers can be isolated

• how efficiently capital can be reallocated

• how clearly borrower concentration can be monitored

• how confidently new vehicles can be introduced

At scale, administration moves closer to operating infrastructure. The model no longer just supports reporting. It supports how the strategy is understood day to day.

The Alter Domus Perspective

As private credit platforms expand, administration becomes central to how portfolios are understood and operated. Alter Domus supports this evolution with operating models designed for dynamic portfolios, multi-vehicle allocations, and borrower-level exposure visibility. Increasingly, this is underpinned by connected data and workflow intelligence that allows managers to move from periodic reporting to continuous portfolio insight.

Strategic chess pieces symbolizing investor considerations in syndicated loan and private credit decisions.

From governance intent to operational execution

In Part 1, we explored how governance expectations have evolved as portfolios have grown more complex. Investment committees and boards are placing greater scrutiny on the quality of information, liquidity assumptions, and the operational frameworks that support decision-making.

The implication is clear: governance is no longer defined solely by structure or mandate. Its effectiveness is determined by how consistently it can be translated into execution.

This is where the operating model becomes critical.

Oversight does not happen in isolation. It is enabled or constrained by the systems, data flows, and processes that sit beneath it. Where those foundations are fragmented or manual, governance becomes reactive. Where they are integrated and controlled, governance becomes proactive and confident.

The breakdown: where operating models fail

Across many asset owners, the challenge is not a lack of governance frameworks. It is the friction within the operating model that undermines them.

Three failure points are consistently observed:

1. Fragmented data environments
Portfolio data is dispersed across administrators, managers, custodians, brokers, and internal systems. Reconciling these sources of data is time-consuming and often incomplete, limiting the ability to form a single, trusted view of exposures.

2. Delayed and inconsistent reporting
Decision-making is frequently based on backward-looking information. By the time data reaches investment committees, it may already be outdated or inconsistent across sources.

3. Limited forward visibility
Liquidity, commitments, and portfolio-level risk are not always visible in a forward-looking, aggregated format. This constrains the ability to anticipate and respond to changing conditions.

These are not technical issues in isolation. They directly affect governance outcomes — slowing decision-making, reducing confidence, and increasing reliance on judgment where data should lead.

Reframing the operating model as governance infrastructure

Leading asset owners are responding by repositioning operations as core governance infrastructure.

This shift is not about incremental efficiency. It is about enabling three capabilities that underpin effective oversight:

1. A single, reconciled source of truth

Data must be aggregated, validated, and standardized across managers and asset classes — but more importantly, it must be controlled and traceable.

The objective is not simply visibility, but trust: the ability for boards, auditors, investment, and operations teams to rely on a consistent version of portfolio data.

2. Timely, decision-ready information

Operating models must deliver information at the cadence required for decision-making — not at the pace dictated by underlying processes.

This includes:

Near real-time visibility into exposures and performance
Consistent reconciling and reporting across portfolio, asset class, and manager views
Clear audit trails supporting each output

3. Forward-looking portfolio intelligence

Oversight increasingly depends on anticipating, not reacting.

This requires:

Aggregated visibility into capital calls, investments, distributions, withdrawals, and unfunded commitments
Scenario analysis to assess liquidity and risk under different conditions
The ability to understand portfolio dynamics at a total-portfolio level

Together, these capabilities move governance from periodic review to continuous oversight.

The role of independent operating partners

As these requirements intensify, many institutions are reassessing how their operating models are delivered.

Traditional models — built on internal teams supplemented by multiple service providers — often struggle to scale with portfolio complexity. The result is duplication, manual reconciliation, and inconsistent outputs.

In contrast, integrated operating models — delivered in partnership with specialist providers are designed to:

Aggregate, capture, and reconcile investment data across the entire portfolio
Provide independent validation and reporting
Reduce operational burden on internal teams
Ensure consistency across systems and outputs

This is not a shift away from control. It is a shift towards structured, independent oversight, supported by institutional-grade infrastructure.

From visibility to decision advantage

Ultimately, the effectiveness of an operating model is measured by its impact on decision-making.

Where operating foundations are strong:

Investment committees can interrogate data with confidence
Portfolio risks are identified earlier
Liquidity decisions are made proactively
Governance discussions are anchored in consistent, reliable information

Where they are weak:

Decisions rely on incomplete or delayed inputs
Oversight becomes retrospective
Confidence in data — and therefore decisions — is reduced

The difference is not marginal. It is structural.

A more deliberate operating model

For asset owners, the objective has not changed: to deliver long-term performance while preserving mission.

What has changed is the operating discipline required to support that objective at scale.

Effective oversight is no longer defined by governance frameworks alone. It is defined by the operating model that enables them — shaping how information flows, how decisions are made, and how confidently institutions can act across market cycles.

This is driving a shift towards more integrated operating models, where data aggregation, validation, and reporting are delivered through a single, controlled infrastructure rather than across fragmented providers and internal processes.

At Alter Domus, this is reflected in operating models that bring together accounting, administration, and reporting within a single, controlled framework – enabling institutions to move from fragmented oversight to consistent, decision-ready insight.

As portfolios continue to grow in complexity, those that invest in operating infrastructure will not only strengthen governance. They will gain a more fundamental advantage: the ability to translate insight into action, consistently and at scale.

Technology data on screen plus fountain pen and notepad

The pressure behind the problem

Private markets have entered a new phase of scale. Since 2008, global private markets AUM has grown from roughly $4 trillion to $16 trillion. As platforms expand across strategies, jurisdictions, and vehicles, operational models originally designed for smaller portfolios are now under significant strain.

This growth has not only increased asset complexity, but also reporting expectations. Institutional investors now view private markets as a core portfolio allocation and expect transparency, consistency, and timeliness that match that importance.

At the same time, operational teams remain heavily reliant on manual monitoring processes, while large volumes of data remain unstructured. This limits the ability of managers to respond to LP demands and maintain consistent reporting across portfolios as they scale.

Consistency, rather than accuracy alone, is becoming the defining operational challenge.

Inconsistency: the hidden challenge

Maintaining accuracy has always mattered. Maintaining consistency is now the bigger issue.

As private markets platforms expand geographically and across strategies, data flows through multiple administrators, AIFMs, and internal systems. Managers often reconcile figures from disconnected sources, each with different structures, formats, and reporting timelines.

These reconciliations frequently rely on manual interpretation. Data arrives at different times, in different formats, and under different capture protocols. The result is not necessarily incorrect reporting, but inconsistent reporting.

This distinction matters.

A cluster of small inconsistencies at the asset level can quickly compound into material differences at the fund level. Over time, this erodes confidence, slows decision-making, and creates friction in fundraising and governance.

Consistency, not just accuracy, becomes the defining requirement.

Scaling capacity to deliver consistency

Historically, firms addressed reporting complexity by expanding operational teams. But private markets platforms have now crossed a threshold where scaling through hiring alone is no longer sustainable.

The size and complexity of modern platforms require a different approach. Managers are shifting toward operational models built around structured data, repeatable processes, and automation.

Operational intelligence is becoming as important as investment strategy. Reporting is no longer a back-office output. It is now central to fundraising, portfolio management, and investment decision-making.

The ability to collect, process, and model data consistently is increasingly shaping how managers compete.

How repeatability builds consistency

Repeatability is emerging as the foundation of consistent reporting.

Data repeatability means applying the same collection, formatting, and processing methods across investments, funds, and jurisdictions. When data is repeatable, reporting becomes predictable. When reporting is predictable, it becomes scalable.

Repeatability enables automation. Clean, structured data allows firms to replace manual reconciliations with standardized workflows. This improves speed, reduces risk, and strengthens reporting reliability.

It also builds institutional confidence. Investment committees and LPs gain visibility into performance, supported by data that is predictable and trusted.

Without repeatability, complexity compounds. Processes vary across jurisdictions. Data fragments. Manual interpretation increases. Inconsistency grows.

Building the foundation for repeatability

Embedding repeatability requires a shift in how firms view data. Data must move from an operational concern to a strategic priority.

Leadership alignment is the starting point. Consistency must be treated as a firm-wide objective, not just a finance or operations initiative.

The next step is structuring and standardizing data. When data remains unstructured, manual processes dominate. When data is structured and standardized, automation and AI can be deployed to replace manual intervention.

This transforms data management from interpretation to orchestration. Reporting becomes consistent. Processes become scalable. Visibility improves.

Firms that institutionalize repeatability operate with greater stability, even as complexity increases.

From consistency to competitive advantage

When repeatability is embedded, data management evolves. It moves beyond assembling reports toward enabling insight:

Managers gain clearer visibility into performance
LP reporting becomes more predictable
Operational risk declines
Decision-making accelerates
Platforms scale without proportional headcount growth

Consistency becomes more than an operational outcome. It becomes a competitive advantage.

As private markets platforms continue to scale, consistency is becoming a defining capability. Small inconsistencies no longer remain isolated. They compound across funds, jurisdictions, and reporting cycles.

Managers that prioritize repeatability, structured data, and consistent operating models will be better positioned to scale with confidence and meet rising investor expectations.

This is where a unified data perspective becomes critical. We are developing Alter Domus Intelligence, a digital operating environment that connects client-facing services, data, and workflows, enhanced with AI-driven insight and automation. This capability will bring together information from across fund administrators, AIFMs, entities, and internal systems into a single, consistent view. By standardizing data structures and enabling repeatable reporting frameworks, managers gain coherence across platforms rather than reconciling fragmented outputs.

This foundation supports consistent reporting, clearer portfolio visibility, and operational models designed to scale. It also enables automation and AI-driven workflows to sit on top of standardized data, improving reliability while reducing manual intervention.

The firms that address consistency early will not only improve reporting reliability. They will build the data foundation required to scale with control, strengthen investor confidence, and operate with clarity under pressure.

Cross-border expansion is no longer a strategic milestone. It is an operating condition.

Europe is no longer just a fundraising opportunity for U.S. private markets managers. It is becoming a structural part of how capital is raised. But entering Europe changes more than investor geography. It introduces parallel regulatory regimes, distributed governance, and new reporting expectations that reshape the operating model.

This article explores what actually changes when managers operate across jurisdictions, where complexity emerges, and why execution, not access, is now the differentiator. It examines how data, reporting, and governance can fragment at scale, and what leading managers are doing to operate as a single, coherent platform across regions.

From expansion to operating reality

For U.S. private markets managers, Europe has become a structural component of fundraising strategy. After a period of contraction, global private capital fundraising stabilized at approximately $1.3 trillion in 2025 (Bain & Company), but capital formation remains more selective and uneven across strategies.

Domestic LP pools are no longer sufficient to absorb new allocations at prior levels. Distributions have slowed, allocation pacing has tightened, and even established managers are increasingly looking beyond the U.S for capital.

Europe presents a deep and diversified investor base. However, expansion into European markets introduces a fundamentally different operating environment.

What changes is not only where capital is sourced, but the expectations attached to it.

European institutional investors typically operate within more formalized regulatory frameworks, with heightened scrutiny on governance, reporting consistency, and data transparency. Industry surveys indicate that over 70% of institutional LPs prioritize more frequent and granular reporting—raising the operational bar for managers operating across jurisdictions.

As a result, cross-border expansion is no longer just a distribution challenge. It is an operating one.

Access is established. Execution is the constraint.

Market entry pathways into Europe are becoming more understood.

Reverse solicitation remains limited and opportunistic in practice
National Private Placement Regimes (NPPRs) provide partial and jurisdiction-specific access
Luxembourg structures enable EU marketing passporting under AIFMD

In response, Luxembourg has become the default structuring hub for non-European managers seeking systematic access to European capital.

It offers:

EU-wide marketing passporting across the European Economic Area
Growing appetite as a jurisdiction of choice for Asian investors
A well-established regulatory framework under AIFMD
Depth of service providers and operational infrastructure

This is reflected in market behavior. According to ALFI, U.S.-originated funds held over €1.2 trillion in Luxembourg as of 2025, more than any other jurisdiction.

Establishing a Luxembourg structure introduces parallel operating requirements alongside existing U.S. models—creating a multi-layered operating environment rather than a replacement of one system with another.

Where complexity actually manifests

Cross-border complexity does not emerge at the strategy level. It emerges in the operating model.

Three fault lines consistently appear:

1. Fragmented service providers and data environments

Fund, entity, and regulatory data are distributed across administrators, AIFMs, and internal systems—often structured differently by jurisdiction.

The consequence is not simply inefficiency, but the absence of a single, consistent view of performance and risk.

2. Parallel reporting frameworks

U.S. and European reporting regimes—SEC, AIFMD, Annex IV—operate independently, with differing timelines, formats, and levels of granularity.

Firms do not transition between frameworks. They run them concurrently.

This introduces duplication, reconciliation challenges, and increased risk of inconsistency.

3. Diffused governance structures

In the U.S., control is largely centralized within the GP.

In Europe, governance extends across the AIFM, fund boards, and delegated service providers. Oversight becomes distributed across entities and jurisdictions.

Without clear alignment, firms introduce decision latency, duplicated controls, and fragmented accountability.

The compounding effect: operational drag at scale

Individually, these challenges are manageable. At scale, they compound.

Data must be reconciled across multiple sources before decisions can be made
Vendor management and coordination requires additional resources
Reporting becomes a coordination process rather than a controlled output
Portfolio insights are delayed or inconsistent across jurisdictions

The impact is not limited to operational efficiency.

In practice, these gaps shape how managers are evaluated by LPs. Inconsistent reporting, fragmented data, and diffused governance raise questions around control, transparency, and institutional readiness, particularly in cross-border structures.

In a more competitive fundraising environment, this has direct consequences. It affects a manager’s ability to raise capital, retain investor confidence, and scale strategies across jurisdictions without friction.

What begins as structural expansion can, if not addressed, become a constraint on growth.

From structure to operating model

Leading managers are shifting from a structure-led approach to an operating model-led approach.

They recognize that success in Europe is not determined by where the fund is domiciled, but by how the platform operates across jurisdictions.

This requires deliberate design:

Integrated data architecture spanning funds, entities, and service providers
Aligned reporting frameworks that reconcile U.S. and European requirements
Clear governance models defining accountability across the GP, AIFM, and third parties
Operational consistency that scales with the platform

The objective is not simplification. It is coherence.

Operational intelligence as the differentiator

The most advanced managers are not attempting to reduce complexity. They are building the capability to manage it—systematically.

In practice, this requires more than coordination across jurisdictions. It requires an operating model that is designed for multi-entity, multi-regime execution from the outset.

That means:

Establishing a single data architecture across jurisdictions, funds, entities, and service providers—rather than reconciling fragmented views after the fact
Embedding reporting consistency across U.S. and European frameworks, instead of managing them as parallel processes
Defining clear governance and accountability models across the GP, AIFM, and delegated providers
Creating operational workflows that scale across jurisdictions without duplication
Minimizing the number of vendor relationships involved in servicing a fund

Firms that achieve this do not eliminate complexity. They control it.

This is where operational intelligence becomes a practical capability—not a concept.

It enables managers to maintain a consistent view of performance and risk, respond to increasingly detailed LP expectations, and scale without proportionate increases in operational cost.

Conclusion: execution defines outcomes

Access to European capital is now part of life. The infrastructure exists, and the pathways are well established.

The differentiator now lies in execution.

For many managers, entering new markets is a challenge, but operating across them with consistency becomes even more challenging. Cross-border strategies introduce structural and regulatory complexity, but it is the operating model that determines whether that complexity is controlled or compounded.

This is where outcomes begin to diverge.

Firms that treat expansion as a structuring exercise often encounter fragmentation as they scale—across data, reporting, and governance. Over time, this limits visibility, slows decision-making, and undermines confidence at the LP level.

By contrast, firms that design their operating model around multi-jurisdictional execution from the outset—aligning data, reporting, and oversight—are better positioned to scale with control, maintain consistency, and meet increasing investor expectations.

This is not a secondary consideration — it is a defining one.

Managers that treat expansion as a structuring exercise often introduce fragmentation across data, reporting, and governance. Those that design their operating model for multi-jurisdiction execution scale with greater control, consistency, and transparency.

In my recent whitepaper on the Operating Intelligence – A New Opportunity for Investors, I explored a structural challenge emerging across private markets: as firms scale, their data, governance and operational infrastructure often fail to scale with them.

That paper focused on the nature of the issue — the limits of legacy operating models.

But stepping back as CEO, I believe the implications run deeper still. The problem is not simply operational inefficiency. It is becoming a strategic fault line.

So here is a broader perspective on what operating intelligence now means for leadership, resilience and competitive differentiation in the next phase of private markets.

Over the past decade, the industry has matured at extraordinary speed. Firms have expanded across strategies, geographies and products. LP expectations have risen. Regulatory scrutiny has increased. And the pace of decision-making has accelerated.

Yet behind the performance, many operating models still look remarkably familiar.

For too long, the operational layer of private markets has been treated as a necessary function. Something to manage. Something to outsource. Something to keep running in the background.

This paradigm is coming to an end. As private markets scale, operating models are no longer a back-office concern. They are becoming a strategic advantage.

Complexity is not new. The consequences are.

Private markets have always been complex. Cross-border structures. Multiple entities. Different reporting requirements. Unique fund terms. Asset-level nuance.

What has changed is the scale at which that complexity now operates.

Many firms are running more funds, across more strategies, with more portfolio companies and more investors than ever before. They are expected to deliver faster reporting, deeper transparency, and stronger governance.

And they are doing this while operating in a world where data is everywhere, but insight is not.

The result is simple: private markets firms are being asked to make faster decisions, with greater confidence, across a much more complex environment.

The real challenge is coherence

Most firms don’t have a shortage of information.

They have too many systems, too many workflows, and too many disconnected sources of truth.

Information exists across fund accounting, portfolio reporting, investor communications, loan administration, and multiple third-party platforms. But too often it is fragmented, delayed, and difficult to connect.

In practice, that means teams spend time reconciling rather than understanding. Reviewing rather than anticipating. Explaining rather than acting.

And crucially, it means insight can arrive too late to influence the decisions that matter most. This is not a technology issue alone. It is an operating model issue.

Fund administration is evolving

Fund administration has historically been defined by execution.

Accurate books. Timely closes. Reliable reporting. Strong controls. Professional service. Those fundamentals remain non-negotiable.

But today, what firms need from their operating partners is expanding.

They need visibility across their business, their funds and their portfolios – delivered with speed and accessibility.

They need insight that reflects how they actually invest. Insight that aligns with their strategy, their structures and their competitive strengths.

They need operating models that support decision-making, not just reporting.

They need earlier signals. Less reconciliation. More forward-looking clarity. This is where fund administration begins to shift from service delivery to operating intelligence

Intelligence is not a dashboard

When we talk about intelligence, we do not mean another portal or another layer of generic reporting.

We mean something more fundamental: the ability to bring together data, workflows, and expertise into a single coherent operating view.

True intelligence identifies exceptions early, reduces friction, and delivers insight at the exact point where decisions are made – tailored to a firm’s strategy, risk appetite, and investment approach.

That means a firm’s intellectual property must be embedded in the insights themselves. And critically, intelligence combines technology with human expertise to strengthen governance, reduce risk, and support scale.

This is not a shift driven by fashion. It is driven by necessity.

A new role for operating partners

As the industry evolves, the relationship between GPs and service providers must evolve too.

The future belongs to operating partners, not transactional vendors.

Partners who understand the realities of private markets. Who can deliver consistently across strategies and geographies. Who can help simplify what can be simplified, standardize what must be standardized, and build trusted foundations beneath every process.

And who can use modern technology to help firms operate with greater clarity, confidence, and resilience.

What comes next

Private markets firms will continue to grow. Complexity will continue to increase. Expectations will continue to rise.

The firms that thrive will be those that build operating models designed for what comes next.

Operating models that support decision-making, not just reporting. Operating models that reduce risk, not just process it. Operating models that scale without breaking.

At Alter Domus, we believe fund administration is becoming something bigger: the operating infrastructure of private markets. A crucial source of data and insights to drive value for investors

And our responsibility is to help our clients shape that future.

Not by adding noise. But by bringing clarity.

Not by replacing expertise. But by amplifying it.

Not by offering more tools. But by building a better operating model.

Because in the next era of private markets, performance will always matter. Expectations will rise.

For us as fund administrators, the bar is rising even more. Great service and a relentless focus on delivering new sources of value will matter even more.

The scale shift reshaping private markets

Change is sweeping through the private markets industry. Fundraising is concentrating into fewer hands. Manager consolidation is running at all-time highs. Regulatory and reporting demands are intensifying. The need for speed and access to data will continuously increase.

These shifting market dynamics are forcing GPs to reappraise how they remain relevant and competitive.

Success in private markets has always been grounded in investment intelligence – the ability of a manager to map markets, source proprietary deal flow, conduct due diligence on assets and establish a valuation. If a manager bought the right asset at the right price, the rest would take care of itself. GPs have invested in their firms accordingly, sticking to the proven formula for success: grow the front office deal team, secure new deals, and keep operations lean.

But while this model has served managers well for years, the asset class has reached a size and complexity where operational intelligence should start to complement exceptional investment intelligence. A virtuous circle of real time outcomes informing real time decisions. Technology and data in place of manual brute force.

The operating intelligence gap

Today’s private markets industry is operating on a totally different scale to 20 years ago. Alternative assets under management (AUM) have grown from US$3.1 trillion in 2008 to more than US$16.7 trillion in 2024, according to Preqin, and are forecast to reach US$30 trillion by 2030.

Growth in AUM has meant more data for GPs to manage, across more funds and more strategies. Operating models that sufficed in the 2000s (and characterized by fragmented systems and service providers) are no longer fit for purpose.

Managers that used to engage with LP clients almost exclusively through 10-year, closed-ended commingled funds now offer investors separately managed accounts (SMAs), co-investments and sidecar arrangements. The emergence of the non-institutional investor channel, accessed through evergreen and feeder fund structures, brings added layers of complexity, but can’t be ignored, with Pitchbook forecasting that in the US alone evergreen assets will more than double by the end of the decade to reach north of US$1 trillion.

Simultaneously, there has also been a step-change in LP expectations around the detail and frequency of GP reporting. Investors are seeking timely, credible information that enables them to manage liquidity and assess private markets performance relative to other asset classes in real time.

Operations teams built to service quarterly reporting cycles with backward-looking performance reviews will have to evolve if their firms are to meet the expectations of investors.

GPs will have to respond by upgrading their operational intelligence capability – and not only to cope with greater transaction volume, but also greater complexity. Recent technological innovations, notably AI, mean the industry’s time for change is now.

It is time to gear up for sustained investment in technology: a flexible, cloud-based infrastructure; best-of-breed tools across all asset classes and processes; functionality and analytics layered over software; AI models and agents that accelerate and sustain workflows and security by design.

Let’s build for a world where GPs and LPs will access fund administrators’ data and insights directly, through data exchanges, via machine-to-machine connectivity and APIs. The need for speed and flexibility will only increase.

From fund administrator to operating partner

Fund administration provision was also fragmented by jurisdiction, service line and asset class. Providers played to their strengths and stuck to their niches. GPs did see benefit in best-of-breed expertise, but as fund sizes grew and managers branched out into more jurisdictions and investment strategies, fund administrator relationships morphed into a messy patchwork of myriad relationships that became more difficult for GPs to control as their organizations sought scale.

GPs are now actively looking for opportunities to consolidate their relationships and work with outsourcers who can provide a full basket of services that straddle asset classes and geographies. A recent Alter Domus survey showed that 60% of GPs already preferred bundled services, with this proportion expected to climb to 70% in the three-to-five-year period following the initial survey.

The upshot for fund administration is that the industry must change to reflect the change in its GP client base.

In the future, the fund administration industry will be comprised of fewer, but larger firms, that have the bandwidth to cover all of a manager’s operating requirements, as opposed to the old industry model of fragmented service providers operating in their own data and service-line siloes.

This will demand a reappraisal of how service providers think about themselves and make a shift from serving as arms-length fund administrators doing the mundane back-office work on the GP’s behalf, into embedded operating partners who work closely with managers to provide operational intelligence that informs how GPs should grow and invest.

Deepening relationships

Operating partners will become integral to how firms are run and the data they depend on to invest. This is a serious undertaking for both parties, who will have to work closely on technology integration and share responsibility for governance.

Operating partners will also be expected to be at the forefront of regulatory, technology and investor relations trends, and to leverage their global networks, in-house technology expertise and financial reporting knowledge to provide their clients with a single operating view across all of their investment strategies, LP relationships and fund structures.

For GPs these partnerships will extend beyond a helping hand with administrative tasks and back-office housekeeping.

The data and analysis operating partners produce will be what managers count on when seeking insight and making decisions. GPs will no longer choose services from a menu of options provided by service providers but will seek out operating partners who understand what GPs are trying to achieve, and how to facilitate it.

It will be down to the operating partner to accelerate reporting timelines, identify underperforming assets earlier, empower risk and investment committees with insight, and give managers a foundation allowing them to scale without their operations splintering.

A model for the future

For me, this is no longer a debate about modernization. It is about competitiveness.

As private markets continue to scale and consolidate, operational strength will increasingly determine strategic freedom — the ability to launch new structures quickly, enter new jurisdictions with confidence, integrate acquisitions effectively, and provide investors with clarity in real time.

At Alter Domus, we are building our business around that reality.

We partner with managers at every stage of scale — from global multi-strategy platforms navigating complexity across asset classes and jurisdictions, to high-growth firms building the operational foundations for their next phase of expansion. The operating intelligence challenge looks different at each stage, but the imperative is the same: operations must enable ambition, not constrain it.

We are reshaping our operating model to connect data across asset classes and geographies, accelerate reporting cycles, and enable insight to move at the pace of decision-making. We are investing in automation and AI to reduce friction and deliver portfolio-level visibility that supports both governance and growth.

But this evolution is not about systems alone. It is about partnership.

The managers who will succeed in the next decade will be those who treat operations as a strategic capability – and who choose operating partners prepared to scale with them.

The operating intelligence gap can be closed.

We are ready to lead – and ready to partner.

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From Fund Administration to Operating Intelligence: Why Private Markets Need a New Operating Model