We are in one now.

As investors debate whether AI will commoditize software, risk appetite has pulled back. Lending standards are tightening. Public software multiples have compressed. Many of the largest alternative asset managers are down more than 20% year to date. In moments like this, markets often price in a harsher future than fundamentals justify.

Today's pressure is concentrated, largely around software exposure within credit portfolios and equity holdings. Yet beneath the volatility, the operating data tell a more balanced story. Our Q4 2025 US Public PE and GP Deal Roundup examines results from Blackstone, KKR, Apollo, Ares, Blue Owl, Carlyle and TPG to separate the bearish narrative from what the fundamentals actually show.

In 2025, private credit strategies across the Big Seven delivered a median 11.2% return, reinforcing their role as a core financing channel. Deployment accelerated sharply in Q4 as financing conditions improved. Realizations climbed nearly 15% year-over-year as IPO pipelines rebuilt and M&A sentiment firmed. Credit fundraising remained dominant, accounting for more than half of total inflows.

 

Firms are also widening their playbooks. Digital infrastructure tied to AI demand is scaling. Wealth and insurance channels are compounding into durable capital bases. Sports investing is expanding the opportunity set. Capital is not retreating. It is repositioning.

In a familiar cycle, investors sell first and reassess risk after. The real question is where this dislocation is creating mispricing, how underwriting standards are shifting, and which strategies may benefit as conditions stabilize.

Our report breaks down deployment, exits, fundraising, operating results and strategy shifts across the Big Seven, with data through Q4 2025. If you are looking for signals in the noise, download it here.