Welcome to this week's edition of The Private Capital Compass, brought to you by Private Capital Global (PCG), a Sparc Group company. At PCG, we remain committed to helping you navigate volatility and focus on what drives long-term value. Our goal is to equip you with strategic intelligence that empowers confident leadership in a complex environment.

This week, we spotlight five essential developments reshaping the private capital landscape from private equity’s growing push into the $29 trillion retirement market and the impact of geopolitical instability on global deal flow, to renewed interest in carve-outs, the expansion of private credit and wealth-focused strategies, and the rise of premium consumer platforms as differentiated investment targets.

In this edition, we examine how these forces are converging to redefine both capital formation and deployment. Our deep dive unpacks the regulatory and market dynamics opening retirement savings to private equity, the implications of bipartisan policy shifts, and the new coalition of traditional asset managers embracing alternative vehicles. We also spotlight Archimed’s $730M acquisition of ZimVie along with a case study into the recent surge in medtech investments.

We hope you enjoy the newsletter!

Compass Points

Key insights at a glance:

• PE Eyes Retirement Goldmine: Private equity firms are accelerating efforts to unlock the $29 trillion U.S. retirement market, targeting 401(k)s and IRAs with hybrid vehicles that blend private equity and credit exposure. As regulatory momentum builds, the line between institutional capital and individual investors is beginning to blur—marking a structural shift in how Americans may access alternative assets.

• Geopolitics Weigh on Global Deal Flow: Persistent geopolitical tensions and trade instability are slowing global private equity investment. In Q1 2025, deal volume and count dipped across several markets, with investors treading carefully amid shifting international dynamics. Despite the pullback, stable sectors like healthcare and business services remain favored hunting grounds.

• Corporate Carve-Outs Drive Targeted Deals: ZimVie's $730 million sale to Archimed highlights how divestitures of noncore business units continue to attract focused PE buyers. Strategic spin-offs like this offer compelling value creation opportunities, especially in sectors like medtech where operational specialization can drive post-deal performance.

• Private Credit and Wealth Fuel AUM Growth: Blackstone’s latest earnings underscore the firm’s continued success in scaling private credit and tapping into wealth channels. With inflows from high-net-worth and retail investors climbing, alternative credit strategies are becoming a cornerstone of asset growth.

• Private Equity Expands into Premium Mobility: A recent $800 million investment in Flexjet, led by L Catterton and supported by Bernard Arnault’s investment interests, reflects a broader strategic move by private equity into high-end consumer and transportation sectors. As firms seek differentiated assets with resilient demand profiles, premium aviation and luxury services are emerging as compelling targets for long-term capital deployment.

Market Pulse

Equities

• S&P 500 (SPY): 634.42 (+1.02% past week)

• Dow Jones (DIA): 448.20 (+0.42% past week)

Commodities

• Brent Crude: 69.38/barrel

• USO ETF: 76.09 (-1.21% past week)

Deep Dive:  How Private Equity Is Targeting Retirement Plans

After decades of exclusive institutional access, PE firms are making an aggressive play for the $29 trillion sitting in U.S. 401(k)s and IRAs, and this time, the stars are aligning in their favor.

Unlikely Alliances Signal Seismic Shift

The clearest signal comes from an unthinkable alliance: Blackstone has partnered with Wellington Management and Vanguard to bring private equity and private credit to everyday investors through target-date funds. Vanguard's participation represents a philosophical earthquake for the firm built on Jack Bogle's principles of low-cost, transparent investing. Yet as Wellington CEO Jean Hynes noted, "a whole part of the economy has been exclusive to institutional investors, and it's fair that more individuals have access to that."

The reality is undeniable: much of today's economic growth happens in private companies that retail investors cannot access through public markets. This partnership signals a generational realignment of retirement investing.

Political Tailwinds Create Opening

Regulatory momentum is building. Trump's 2020 DOL guidance opened doors for limited private equity in retirement funds. Biden's DOL quickly withdrew that endorsement, citing concerns about plan sponsors overseeing complex investments for average savers.

Now the pendulum swings back. Reports indicate Trump's campaign is drafting an executive order explicitly encouraging alternatives in retirement accounts, directing regulators to provide clear guidance. This would give plan fiduciaries the political cover they've awaited.

The stakes are enormous. U.S. defined-contribution plans hold $12 trillion, with IRAs adding $17 trillion. Even modest allocations could channel hundreds of billions into PE vehicles, fundamentally altering industry fundraising dynamics.

Asset Managers Rush to Capture New Margins

Traditional asset managers face margin compression in an index fund-dominated world, viewing private markets as a way to justify higher fees. Meanwhile, PE firms hunt for new capital as institutional investors approach allocation limits.

Product launches reflect this urgency. State Street launched ETFs blending public and private credit, followed by target-date funds allocating 10% to private assets. BlackRock partnered with Partners Group, while KKR teamed with Capital Group on hybrid strategies.

Critically, major plan providers are embracing the shift. Empower will offer private funds to 19 million participants through partnerships with Apollo, Franklin Templeton, and Goldman Sachs. Voya is collaborating with Blue Owl on private credit workplace plans.

The Trillion-Dollar Question

This evolution promises to democratize access to higher-return opportunities once reserved for endowments, appealing as companies stay private longer and growth happens outside public markets. Yet trade-offs are substantial. Private assets' illiquidity and complexity clash with the daily liquidity 401(k) investors expect. Higher fees and lock-ups could erode returns without careful management.

What's undeniable: private capital's courtship of American retirement money is accelerating. The economic stakes, a $29 trillion pool, are too large to ignore. For dealmakers, the implications are clear: the wall between private markets and everyday retirement savers is cracking, reshaping the industry's fundraising landscape.

Deal Spotlight:

Transaction: French healthcare investment firm Archimed has agreed to acquire dental device manufacturer ZimVie for approximately $730 million, valuing the company at $19 per share in an all-cash transaction. ZimVie, originally spun out from orthopedics giant Zimmer Biomet in 2022, has undergone substantial portfolio optimization over the past two years. After divesting its spine business to H.I.G. Capital for $375 million in 2024, the company refocused entirely on its dental implant and device operations, which generated $449.7 million in revenue last year. The transaction is expected to close by the end of 2025.

Why It Matters: This acquisition underscores a broader resurgence of private equity interest in the medtech sector. Archimed's move also signals European capital's increasing appetite for U.S. medtech assets, as cross-border healthcare transactions become more strategically attractive despite regulatory complexities.

For dealmakers, this transaction validates the "focused pure-play" strategy that many medtech companies have pursued through divestitures and spin-offs. ZimVie's successful exit following its portfolio streamlining demonstrates how targeted specialization can unlock significant shareholder value, particularly when paired with the right private equity partner offering both capital and sector expertise.

The Democratization of Private Capital

This week’s developments point to a reshaping of private equity’s opportunity set. The retirement savings market is now opening through regulatory momentum and strategic alliances, suggesting a new era of retail access to private markets. For fundraising teams, this shift could diversify LP profiles and create long-tail capital access at scale.

At the same time, deal flow is tightening under macro pressures, but sector-focused strategies are gaining traction. The ZimVie transaction underscores how portfolio simplification and carve-outs continue to generate value in specialized verticals like medtech. Meanwhile, growth in private credit and wealth-focused channels signals that firms are building distribution infrastructure beyond institutional investors.

For deal teams, these signals warrant a broader lens: tracking policy as a driver of capital flows, targeting high-conviction sectors with operational levers, and positioning for retail-aligned products without diluting underwriting discipline. Whether it’s structuring new access vehicles or refining platform theses, the next wave of opportunity is unfolding at the intersection of regulation, specialization, and capital democratization.

Opening & Closing Remarks from Erik Boender, Vice President & COO, Private Capital Global (a Sparc Group company)

Thank you for reading this week’s edition of The Private Capital Compass. As we head deeper into the second half of 2025, our aim remains clear: to surface the signals that matter and support our executive community. Let’s keep navigating sector together!