Carlyle Group Says Wealth Business Has Doubled Since 2023

Carlyle Group Inc.’s wealth business has nearly doubled since 2023, driven by CEO Harvey Schwartz’s strategic focus on retail expansion and alternative assets. The firm is on track for the wealth division to represent around 20% of its capital flows, according to Shane Clifford, global head of wealth at Carlyle. The growth is attributed to the transfer of wealth from Baby Boomers to their heirs, often referred to as the 'silver tsunami'.

Clifford highlighted that private markets now occupy 10% to 30% of portfolios for high-net-worth individuals, up from 5% to 6% a few years ago. This shift reflects a broader diversification of investment portfolios among the wealthy. The expansion is part of a larger trend, with alternative asset managers like Blackstone Inc. and Apollo Global Management Inc. also aiming to capture a share of the $12 trillion in American retirement accounts.

Carlyle has introduced new retail-focused funds allowing investors to buy and sell secondhand private equity stakes. The firm has also partnered with Oracle Red Bull Racing to offer unique experiences to its clients.

Why Did This Happen?

The silver tsunami is accelerating, as Baby Boomers pass wealth to their heirs. This generational transfer is a key driver of wealth management growth among firms like Carlyle. Shane Clifford noted that he is witnessing the phenomenon in real time. The firm is capitalizing on this trend with a multiyear partnership with Oracle Red Bull Racing to attract and retain high-net-worth clients.

How Did Markets React?

The expansion into retail by alternative asset managers is reshaping the wealth management landscape. Other private equity firms, including Blackstone and Apollo, are also investing in new partnerships and products. Carlyle’s move into retail reflects its aim to capture a broader base of investors looking for alternative assets.

What Are Analysts Watching Next?

Analysts are tracking the performance of new retail-focused funds introduced by Carlyle. These funds enable individuals to trade secondhand private equity fund stakes, a relatively novel approach for retail investors. The firm’s ability to execute on this strategy will determine its success in the alternative assets space.

The competitive environment in wealth management is intensifying, with firms vying for a share of the $12 trillion in American retirement accounts. Carlyle’s strategic initiatives aim to position it as a key player in this space.