In this what Ted's thinking, can private markets normalize, I pose the question of whether

private equity will ever be able to recycle capital fast enough to support successive

fundraisers without strain. The answer, I'm afraid, is no. In a world dominated by

short-termism, does it seem odd that private equity holding periods are getting longer? Public

market investors trade faster than ever, and social media dopamine hits are relentless.

Yet private equity portfolio companies are now held for more

than six years on average. Private equity professionals don't have different genes than other

investors. They face a structural problem. Too many portfolio companies cannot find a buyer.

A year ago, I asked the question, when will private markets

normalize? At the time, I argued that expectations for a surge of capital returning from

private equity exits were premature. That assessment proved correct. While exit activity increased,

it remains far below what would be required for private

markets to recycle capital fast enough to support successive fundraisers without strain.

I've continued to think about whether normalization is possible this year. Once again,

the answer is no, not yet. I'm starting to wonder if the answer is no, not

ever. Viewing private equity through a supply and demand lens helps explain why. On the

purchase side, growth remains robust. On the exit side, supply overwhelms demand. Supply and demand for purchases.

Over the past decade, the total unrealized value held by global private equity funds has

tripled, rising from approximately $1.1 trillion to $3.2 trillion. For this to happen, private equity markets

had to expand on both the capital and opportunity fronts. Demand for private equity has surged,

as institutional allocations rose, motivated by a long history of strong returns. In addition to tripling deployed capital,

private equity firms now sit on another $1.2 trillion in dry powder. Looking ahead, further growth

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