Fraser van Rensburg is a founder and managing partner at advisory and private markets placement firm Asante. He manages a number of Asante’s global fundraisings.

Do you see conditions in the fundraising market getting any easier?

We certainly came into 2024 with no great expectations, but when picking up the phone to LPs in the first few months of the year, some were more open to talking about new offerings and new ideas. Allocations are still way down compared to pre-2022, but there has just been a bit more going on, some of which is down to supply and demand. The bottoming out, though, has largely happened, and we are starting to see what we think of as green shoots. The remaining part needed is the M&A market. Once the buyer-seller expectation gap on pricing closes and M&A starts to pick up, distributions will start going back to LPs, which will then have a knock effect on the fundraising market.

Are you seeing more US middle market sponsors look outside of the US for new LPs?

The Middle East is a hot spot, but it’s still contextually small within the bigger picture. While there’s a lot of money there, collectively there are only maybe 50 LPs in the region that have the sought-after firepower. That’s a drop in the ocean compared to Europe or the US. If you take a mid-market US fund out there and they get around 5% of their fund from the Middle East, that’s a good outcome. And 10% is an amazing outcome. There’s a broader opportunity [for US middle market funds] in Asia-Pacific as there are more programs across the region if you include Australia. GPs, though, must be willing to visit these regions two to four times during a fundraising as those LPs don’t operate well on Zoom. It’s a lot of travel, so it’s up to the GP whether they’re willing to really make a pronounced effort to get out there.

What about the private wealth channel?

It’s an emerging, increasingly growing, trend within our industry. I think that if you ask that same question five years from now, it’s going to be a bigger percentage of the average private equity fund. But it’s still a bit bifurcated as only a small number of private wealth channels can do things within a reasonable time frame. For large banks, for example, it could take 9-12 months just to get on their platform, and then they have to start marketing to their high-net-worth individuals. A very successful mid-market private equity fund that gets done within six or eight months would have to start on that process 18 months before coming to market. For the most part, it’s currently the USD 5bn-plus funds that are benefiting. That will change – just like any other institutional investor who started penetrating private equity started with very big funds and then gradually went further down the market.

Where do you see the biggest opportunity currently?

For us, it’s mid-market buyout funds. It’s quite a broad spectrum but goes from funds as small as USD 500m up to USD 5bn in size. There is a lot of differentiation and still a lot of appetite for funds across that entire spectrum. We are focusing increasingly on specialized funds, as that’s where the market is headed. The US started going that way 20 years ago, and Europe, which was more geographically focused, is also increasingly sector-focused. We look for managers who are differentiated in some way and for managers who create value operationally. Groups overly reliant on leverage and pricing to drive value are the ones suffering in the current environment. We’re back to old-school private equity: who can roll up their sleeves and really make a difference operationally, and who has a sourcing engine to find deals at attractive prices? We’re also doing a lot of product extensions from existing managers thinking about different strategies – for example, small-cap, hybrid debt-equity, or minority equity.

Which geographies are most interesting?

We keep our business evenly weighted between Europe and the US. We’ve had a presence in Europe for 20 years if you go back to our old firm. The US is a deeper, bigger market, and also more competitive. While we’ve been on the ground here for 10 years, there’s still a good amount of white space where we can uncover interesting managers. Outside the US and Europe, it’s all Asia-Pacific. We’ve been able to raise successfully and close oversubscribed funds in China, including Vertex Ventures China and 5Y Capital. In Japan, we recently closed The Longreach Group. In Australia, we raised Potentia Capital’s first 2 funds between 2019 and 2022. We’re also currently working on fundraisings in South Korea and India.

How important is the secondaries business to your strategy?

It’s probably the fastest-growing part of our business. We’ve been around for 14 years now, and it’s been the last six years or so that we’ve really lent into that space. We focus mostly on GP-leds. We first put a team together in Europe. Now we have a team in the US, and we’re executing deals on both sides of the Atlantic. While we don’t have a secondaries team in Hong Kong, our global teams have supported some Asia deals.