Blog
Broadening Retail Access to Private Equity: Promise, Pitfalls, and Progress
PINE Advisor Solutions | 11 November 2025
Momentum is building to expand retail investor access to private equity markets, particularly through 401(k) retirement plans. A recent executive order directing the U.S. Department of Labor (“DoL”) to facilitate investment in alternative assets has sparked widespread enthusiasm among private equity leaders and policymakers. Yet alongside the optimism lies a clear recognition: this shift will demand new compliance standards, fund structures, and investor protections to ensure private equity exposure can fit responsibly within retirement portfolios.
Industry Enthusiasm and Opportunity
Private equity executives have hailed the move as long overdue. “Everyone in the industry is enthusiastic,” said Harvey Schwartz, CEO of The Carlyle Group, who noted that expanding access beyond pensions and accredited investors could finally allow middle-income savers to benefit from private market returns. Stephen Schwarzman, CEO of Blackstone, called the executive order a potential “game-changer” that could open access to the $13 trillion U.S. defined-contribution market.
Marc Rowan, Co-Founder and CEO of Apollo, emphasized that early access will likely occur “indirectly, either through participation in target-date funds or via traditional asset managers who already dominate this market.” Taken together, these comments reflect broad alignment that the defined-contribution market is a “holy grail” opportunity for private equity, massive in scale but also complex to execute.
Regulatory Pathways and Guardrails
The August executive order directs the DoL to review its guidance under the Employee Retirement Income Security Act (“ERISA”) and clarify fiduciary processes for the inclusion of private-market assets in retirement plans. The SEC is also moving in parallel, having lifted the 15% cap on illiquid assets in some exchange-traded funds and signaling openness to expanded private-fund participation. Together, these efforts reflect a coordinated regulatory trend toward “harmonization” between public and private markets.
Operational and Fiduciary Challenges
Even supporters acknowledge that operational and fiduciary obstacles are significant. Private equity’s illiquidity, complex valuation methods, and longer holding periods clash with the daily liquidity and pricing expectations of 401(k) participants. Moreover, plan fiduciaries face heightened legal scrutiny. As Issa Hanna of Eversheds Sutherland noted, “there will be gatekeepers here.” Fiduciaries must approve any such products, and regulators cannot compel them to take on these investments unless they are confident in their prudence. Recent FINRA arbitration and ERISA litigation have underscored the legal exposure that could follow unsuitable retail allocations.
Building Trust and Next Steps
The private equity industry recognizes that trust and education will be key to success. “Private equity firms are very aware that investor trust is paramount,” said Glenn Mincey, U.S. head of private equity at KPMG. He expects firms to exceed regulatory expectations for transparency on fees and risks as they navigate retail partnerships. For both investors and private fund managers, advisors and consultants will continue to play a critical role in helping plan sponsors understand how private-market products fit into participant portfolios. Fund managers looking to capitalize on this vast new source of fundraising will need to navigate evolving regulatory expectations, implement new operational standards, and maintain heightened transparency to build trust with both plan sponsors and investors.
2025 marks the start, not the finish, of retail’s entry into private equity. The coming year will bring public comment periods, rulemaking, and early pilot programs. If managed prudently, the move could help millions of retirement savers share in the long-term growth potential of private markets. But success will depend on balance: enthusiasm matched with discipline, innovation tempered by fiduciary care, and access built on transparency.
Industry Enthusiasm and Opportunity
Private equity executives have hailed the move as long overdue. “Everyone in the industry is enthusiastic,” said Harvey Schwartz, CEO of The Carlyle Group, who noted that expanding access beyond pensions and accredited investors could finally allow middle-income savers to benefit from private market returns. Stephen Schwarzman, CEO of Blackstone, called the executive order a potential “game-changer” that could open access to the $13 trillion U.S. defined-contribution market.
Marc Rowan, Co-Founder and CEO of Apollo, emphasized that early access will likely occur “indirectly, either through participation in target-date funds or via traditional asset managers who already dominate this market.” Taken together, these comments reflect broad alignment that the defined-contribution market is a “holy grail” opportunity for private equity, massive in scale but also complex to execute.
Regulatory Pathways and Guardrails
The August executive order directs the DoL to review its guidance under the Employee Retirement Income Security Act (“ERISA”) and clarify fiduciary processes for the inclusion of private-market assets in retirement plans. The SEC is also moving in parallel, having lifted the 15% cap on illiquid assets in some exchange-traded funds and signaling openness to expanded private-fund participation. Together, these efforts reflect a coordinated regulatory trend toward “harmonization” between public and private markets.
Operational and Fiduciary Challenges
Even supporters acknowledge that operational and fiduciary obstacles are significant. Private equity’s illiquidity, complex valuation methods, and longer holding periods clash with the daily liquidity and pricing expectations of 401(k) participants. Moreover, plan fiduciaries face heightened legal scrutiny. As Issa Hanna of Eversheds Sutherland noted, “there will be gatekeepers here.” Fiduciaries must approve any such products, and regulators cannot compel them to take on these investments unless they are confident in their prudence. Recent FINRA arbitration and ERISA litigation have underscored the legal exposure that could follow unsuitable retail allocations.
Building Trust and Next Steps
The private equity industry recognizes that trust and education will be key to success. “Private equity firms are very aware that investor trust is paramount,” said Glenn Mincey, U.S. head of private equity at KPMG. He expects firms to exceed regulatory expectations for transparency on fees and risks as they navigate retail partnerships. For both investors and private fund managers, advisors and consultants will continue to play a critical role in helping plan sponsors understand how private-market products fit into participant portfolios. Fund managers looking to capitalize on this vast new source of fundraising will need to navigate evolving regulatory expectations, implement new operational standards, and maintain heightened transparency to build trust with both plan sponsors and investors.
2025 marks the start, not the finish, of retail’s entry into private equity. The coming year will bring public comment periods, rulemaking, and early pilot programs. If managed prudently, the move could help millions of retirement savers share in the long-term growth potential of private markets. But success will depend on balance: enthusiasm matched with discipline, innovation tempered by fiduciary care, and access built on transparency.