Unlike funds that invest in listed assets, which are constantly traded on organized stock markets, neither private equity funds nor their underlying investments are listed. This means that there is no organized trading platform where these assets offer liquidity on a continuous basis, which is an important aspect to consider for investors who place importance on the liquidity of their investments. In private equity funds, redemptions or divestments are limited or occur only when the manager allows it, generally after a long period of several years.
On the other hand, unlike funds that invest in listed assets, private companies are not accessible to individual investors and private equity managers, in addition to injecting capital into these companies, are widely involved in their management. The investments in a good part of the operations are usually with controlling interests so that they contribute their vision and experience seeking to improve their income and benefits, with the aim of being able to sell their participation, generating capital gains in the long term.
Investment Options in Private Markets
Within private markets, there are several investment options with different profitability and risk objectives:
Venture Capital or Private Equity: where specialized entities provide financial resources to unlisted companies with high growth potential. This type of investment is usually accompanied by a contribution of experience and professionalization, with different types of approaches such as Venture Capital (investment in companies in their early phases of life), Expansion Capital (growth of companies in intermediate phases), Buyouts (purchase of more mature companies) or Distressed and Turnaround (rescues and transformations of companies in difficulty).
Private Debt: non-bank financing tailored to mainly small and medium-sized companies seeking to grow. This debt can be used for organic expansion, such as increasing production or sales, or for acquisitions, as well as refinancing existing loans.
Infrastructure: This category includes investments in companies that, supported by significant investments in real assets, provide essential services for society, such as energy production, telecommunications, roads, bridges, airports or public buildings. Income from these assets tends to be stable and in constant demand, making them an attractive option for those seeking long-term returns with lower volatility.
New BBVA Funds from Private Markets
There are different ways to invest in private markets. One is directly in the projects. Another, through professionals, which is our responsibility, and which can be through funds and/or the fund of funds format. In the latter case, we invest in several funds with different strategies and private capital projects that complement each other, which allows us a much more diversified approach to this world of private investments.
At BBVA, we have been developing and managing this type of funds specialized in private markets for almost 20 years. Since 2006, we are the only bank in Spain with a team dedicated exclusively to this type of investment. We have launched eight innovative funds in this space, having invested in more than 100 underlying funds. Through an in-depth analysis of funds and managers, we ensure that we select only the best options for our clients. Almost 20 years of experience give us privileged access to the best specialized managers. We are currently launching two new funds, BBVA
Mercados Privados 2024 VII and BBVA Mercados Privados 2024 VIII, which will be available for subscriptions starting at 50 thousand euros, although at the moment they require the investor to have significant assets to be able to access them. Following the closing of the placement in March 2025, the funds will remain closed, with no possibility of voluntary subscriptions or redemptions.
These funds will cover different asset classes, investing in private equity, private debt, infrastructure and venture capital, with robust diversification by strategy, geography and managers. By opting for a global and diversified approach, our investors benefit from balanced exposure to different sectors and regions, spreading potential returns across different risk factors. In addition, the investment horizon or term will be between five and seven years.
Conclusion
Private equity funds represent a solid alternative for investors seeking diversification, growth and long-term profitability. With BBVA’s experience and commitment, these new funds offer an interesting opportunity for those interested in private markets, backed by an expert management team and a highly diversified investment approach.
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