Product innovation and new technologies are accelerating the democratization of private markets, according to State Street’s new report, 2025 Private Markets Outlook: Driving success in volatile environments. The report reveals the biggest trends affecting institutional investors in Switzerland, drawing on our latest global survey of 480 investment firms.

We focus on three crucial themes, each of which has implications for the future of private equity, private credit, real estate and infrastructure.

The democratization of private markets: Fifty percent of Swiss respondents believe at least half of private markets fundraising will come through semi-liquid retail-style vehicles in as little as two years’ time.

Several developments could help unlock growth in retail-style products. Product innovation is key, according to more than one-third (or 35 percent) of Swiss institutions. There is also a need for technology-driven improvements in data access and management.

A focus on quality: The shift from quantity to quality is now entrenched in investment strategies. Private markets investments are seen as a way to manage risk. Respondents from Switzerland say that two key reasons for increasing their allocations to private markets are to manage portfolio volatility and enhance diversification.

The emphasis on quality can also be seen in a shift in capital allocation plans from emerging to developed markets. Developed Europe saw a significant jump in interest since last year’s survey, with 63 percent of limited partners (LPs) now planning investments in this region within the next two years (up from 43 percent in 2024). Respondents in Switzerland are even more enthusiastic about developed Europe over the next two years, with 83 percent of respondents citing it as a key market for investment opportunities.

AI adoption in private markets: The AI revolution is already underway. A significant majority (65 percent) of respondents in Switzerland recognise the opportunity to use GenAI-based large language models to generate analysable data and insights from unstructured information.

The report goes on to explore why private markets are proving to be resilient at a time of increased market volatility and geopolitical uncertainty, as well as which private asset classes are most likely to benefit from the three trends outlined above.