Private equity used to be something that happened over there. Big banks. Big institutions. Deals you read about in the AFR.

Now it is entering everyday life. Your mum or dad who has had a business for 30 or 40 years is transitioning that business to private equity. Your favourite sporting team is being assisted with capital and expertise by private equity.

This world is no longer just something other people do. It is something everyday investors can participate in.

Darren Reed from Prime Financial Group outlined this shift clearly at a recent Wholesale Investor panel discussion. “You’re seeing a transition where this world is now starting to enter the everyday lives of people. It’s becoming real life. It’s not just something that happened that other people do. It’s something we can actually all participate in.”

WAM Alternative Assets is the only listed investment company on the ASX that offers investors access to a diversified portfolio of alternative assets typically accessible only to institutional investors.

This represents a fundamental shift in capital markets structure. Years ago, fund managers would come to Australia and meet with superannuation funds, pension funds, and large endowments to raise capital. That has now changed.

Kelly described the wealth market as “the holy grail” that managers are targeting. “They can see the growth in this market. But it’s important to understand what that market needs and the sort of product and ensuring that the structure works for the client base.”

The amount of choice now available to the investor base is significant. Investors need to navigate that choice and make sure they are making the right decisions for their own investment portfolios.

Australia is experiencing the largest wealth transfer in history. The repercussions for investors and businesses are massive.

The mathematics are stark. Tens of thousands of businesses need to change hands within the next 5 to 10 years. Regardless of how many investors are found to invest and entrepreneurs are found to run them, some really good businesses will simply have to shut their doors because of this flood.

To provide context on the opportunity scale, Kelly noted that there are fewer than 2,000 businesses listed on the ASX today. Most investors in Australia have exposure to Australian equities through those listed businesses. But there is very little exposure to private equity despite 160,000 businesses in transition.

This gives a sense of the size of the opportunity set. The different sectors available. Exposure to businesses that are under-represented in traditional equity portfolios because specific sectors dominate listed markets.

Shaun Bassett from PieLAB Capital focuses on acquiring mature small to medium businesses. Businesses that traditional private equity typically does not look at because they do not have aggressive growth stories. But they have been operating for 30 or 40 years and are fundamentally solid.

This generational shift combined with the trend away from generational handovers creates substantial opportunities. PieLAB Capital was established six years ago specifically to take advantage of this transfer of wealth and businesses from baby boomers.

Bassett explained the investment thesis. “We’re in the thick of it now and there’s a good tail of it still to come.”

The democratisation of private equity operates on both sides of the equation. Not just for investors. For entrepreneurs as well.

Check sizes can be in the tens of thousands of dollars, particularly for first search capital raises. This gives direct connection with real operating businesses for relatively small investments. Not small checks into big listed vehicles. Direct ownership of operating assets.

For investors who might never have owned their own business, this creates tangible participation. Seligman noted that it is not hard finding people who are curious about direct business ownership. “They can actually see something tangible and meaningful there.”

Sports has moved from trophy assets for billionaires into proper institutional asset class territory. Darren Reed from Prime Financial Group explained the transformation through two key realisations.

Sport is the last type of content that must be watched live. We watch it together. We watch it at scale. During COVID lockdowns, what did society deem essential services. “Coles and Woolies have to stay open. The police have to stay on the streets. The hospitals have to stay open. And hey, AFL and NRL, pack up your whole competition, families, coaches, and administrators and put them into military-run biosecure bubbles so we can watch guys chase a ball around on the weekend.”

Sport is part of the fabric of society.

Second, monetisation strategies have evolved. “Investing in sport is not just about buying teams. It’s about applying multiple revenue rails on top of that so you’re not stressing about having a winning season to sell more tickets. It is way more than that.”

These combined factors have democratised sport for everyone. Not just trophy assets for billionaires.

Technology impacts private equity from macro strategy to day-to-day operations. Reed shared a conversation with a US fund manager heavily allocated to OpenAI and Anthropic. “He said we’re about as allocated to directly to artificial intelligence as we possibly can be. What we’re starting to look at now is the second derivative benefits from that technology if our original thesis is correct.”

The answer is food, nature, and sport. “We’re not all just going to sit around contemplating our navels, writing poetry, and reading philosophy. Human beings want to be entertained. Ultimately attention and content is the business we’re in. That’s why I’m very specific about saying sports and entertainment.”

On the operational side, technology will fundamentally change engagement with these assets. “I think it’s very feasible that in five years time, if I’m sitting watching a footy game with mates drinking beers, we’ll be able to watch a totally different feed to if I was sitting with my six-year-old son watching a footy game. The bespoke nature of the way we engage with this will just get better and better.”

Listed markets recently hammered SaaS businesses. Atlassian dropped 30% in four weeks. Globally listed SaaS businesses declined 20% in eight weeks.

This creates valuation disconnects. “This is all around the winners and losers from AI. Ensuring that any accretive M&A acquisitions happening within these businesses are done with a lens to the exit. What that exit looks like, particularly if it’s potentially an IPO. What the markets will think of that and price it given what we’ve seen in recent times.”

Previously, technology investment was a no-brainer. Now investors are sitting back thinking more carefully around the tech side, particularly from an M&A perspective. Getting the metrics right. The market needs to see some exits on the private equity side in this sector to validate the valuations.

Whilst everyone focuses on software and AI, Seligman identified hardware technology as a major opportunity for small and medium businesses in Australia.

Hardware faces regulatory and operational complexity that creates moats. “One of the businesses in my portfolio does instrumentation on mine sites. That instrumentation is subject to a whole control regime in relation to hazardous areas. You might be able to build really interesting novel software to solve that problem, but getting the hardware application into that operating environment is actually really really hard.”

Investing in domestic capability around the hardware firmware layer rather than just the software layer represents a significant opportunity for Australia to progress.

One business PieLAB Capital acquired is 28 years old. Staff who have been there almost the entire time still talk about doing things the way the founder did it. The founder has not been in the business for eight years. They will not adhere to changing over.

But this creates opportunity. “Every business and every industry is different. Any number of different ways AI will impact different businesses and industries. We do it on a business-by-business basis. We believe AI will play a role in improving operations if you apply it well. It’s a productivity piece. Not replacing anyone. What people can do in a couple of hours versus what they could do in a week.”

The assessment happens throughout the entire acquisition process. “When we find businesses that have paid no attention to it and are operating really well with good margins, we see that as greater opportunity. Whether you’re in manufacturing or high-tech, if you’ve ignored it and haven’t done anything about it, there’s probably opportunity.”

Kelly identified secondaries and credit as major opportunities over the next five years. On secondaries, the market is developing properly. “Buying and selling of units in existing private equity funds partway through those fund lives. We don’t have a particularly deep secondaries market in Australia. That is going to change.”

Secondaries are now being used as a proper lever for liquidity rather than buying units in assets with poor quality underlying holdings. Because exits have been limited in this environment, investors are looking at secondaries for liquidity. Superannuation fund consolidation has left small positions in things not part of strategic vision.

On credit, the warning is clear. “We’ve obviously seen a huge amount of capital get deployed into private credit. I think some of that will unwind. I think there’s going to be some disasters. But that does create an opportunity for skilled private equity investors that are very good at turnaround and also distressed credit groups. We’re keeping a close eye on that space so we’re ready to go quickly when the opportunity arises.”

Bassett identified a critical challenge emerging from the generational transfer. “We’re seeing a lot of CEOs going into running businesses that they didn’t found. They haven’t been through that founder journey. They’re replacing a founder in a business. The decision-making is so far different. The level of resilience that the founder had and their ability to solve problems has just gone from the business.”

New CEOs going into businesses lose that founder gene. “You don’t know till it’s gone. They’re the things you can’t find during due diligence. They’re intangible. Bringing that next generation through of leaders is exciting.”

Reed predicted the Big Bash League privatisation will be the catalyst that wakes the market up to sports valuations. “The states have agreed that’s happening in June, July. I think you’ll see teams like Sixers, Scorchers, Renegades, Stars go for prices that are going to make people’s eyes water.”

The dynamics will be fascinating. “Particularly if IPL owners come in and try and get a piece of our market and local syndicates form to try and keep the Big Bash from becoming an IPL B-league.”

Reed drew parallels to the ETA space. “If you look at what has happened with the ETA space and what Pete and Sean are doing in Australian society is God’s work. Helping business owners who’ve worked for 30 or 40 years build amazing businesses, helping them transition. It’s a valuable service to society.”

Applying the US sports entertainment model to Australia with catalysts like Big Bash privatisation will reveal how underpriced and misunderstood this asset class is. “The potential we have in our region over the next 10 years is incredible.”

Australian private markets raised AUD$224 billion in 2025. Capital exists. But the democratisation of access is still emerging.

Historically, capital for small to medium private equity in Australia has been tight. High net worths and family offices have always had access. But the average investor in Australia is now significantly more knowledgeable about private equity. More curious about direct participation.

It is a different style of investing. A level of risk that differs from traditional share market investing or property. There is a layer of responsibility in educating people about how it is different.

But once educated, investors want direct ownership in Australian businesses. Something tangible and meaningful they can see.

The infrastructure gap is closing. More specialised capital for private equity is entering the ecosystem. Allocators are educating their limited partners who previously did not understand the sector. The ecosystem is becoming more savvy about making these investments.

But 160,000 businesses need succession solutions within a decade. The infrastructure must scale faster. Otherwise, good businesses shut their doors. Entrepreneurs lose opportunities. Australia loses sovereign capability.

The democratisation of private equity is not just about investor access. It is about preserving the economic engine that small and medium businesses represent. It is about creating pathways for new entrepreneurs. It is about capturing value domestically rather than watching it flow offshore.

The question is whether Australian capital infrastructure will scale fast enough to capture this once-in-a-generation opportunity.

Related Topics: #PrivateEquity #AlternativeAssets #WealthTransfer #SmallBusinessAcquisition #SportsInvesting #EntrepreneurshipAcquisition #PrivateCredit #Democratisation