Apollo Global Management managing director Veronique Fournier has said that the alternative asset manager is “well on track” to raise $50bn (£39.8bn) from the wealth market for its private capital products by 2026.
Apollo’s chief executive Marc Rowan had previously outlined the firm’s ambitions in attracting wealthy retail investors that wish to diversify away from public markets.
Speaking at the DealCatalyst European direct lending and middle market finance conference last week in London, Fournier – who also holds the role of head of EMEA, global wealth – said that the firm has “made a massive commitment to the wealth market” and is “well on track to meet that [$50bn] target”.
“We’re excited about the wealth opportunity within private credit,” she said. “This is being facilitated by new technology, support from the regulators and innovation on new fund structures being created.”
Global asset managers like Apollo and its rivals such as Blackstone traditionally secured funding from institutional investors such as pension funds, insurers and sovereign wealth funds but have been making efforts to expand into the retail market in recent years to meet their growth aspirations.
However, some industry onlookers have questioned the suitability of private credit for individual investors due to a lack of liquidity and data transparency.
Fournier made the point that Apollo is still targeting the higher, more sophisticated end of the retail market.
“We’re talking about broadening access for high-net-worth individuals,” she said. “It doesn’t mean that we’re suddenly going to create a daily liquid private equity or credit fund.”
Most of Apollo’s wealth assets in Europe are intermediated, Fournier added, either through banks or insurance-linked products. She expects that trend to continue.
Regarding data transparency, Fournier highlighted the role that firms such as Apollo should play in communicating as much as possible with investors.
“I think there’s an element of responsibility when it comes to transparency of data,” she said. “Private data comes with some of the benefits of private markets, but it’s absolutely our responsibility to provide as much data as we can to our clients.”
Looking at the regulatory climate, Fournier noted the challenges of opening up private assets to individual investors in Europe, compared to other parts of the world.
“Regulators are taking different views on private investors,” she said. “It’s not like the US where you can open up a business development company (BDC) to the mass affluent. In Spain and France, the regulators are more protectionist when it comes to offering illiquid assets to retail investors.
“I hope one day we have an equivalent in Europe to a BDC, as it would mean that the regulators have all agreed about how to retail-ize these products.”
Last December, it emerged that Apollo is setting up a company in the US that will connect retail investors with asset-backed loans, with a minimum investment threshold of just $2,500.
The Apollo Asset Backed Credit Company will fund and structure debt securities backed by different types of loans to individuals and businesses, according to documents filed with the US Securities and Exchange Commission, cited by Bloomberg.