As the years go on, demographic shifts within various types of asset classes are changing the investment landscape. Private market investments, previously exclusive to institutional investors and high-net-worth individuals, have been attracting a broader audience, particularly younger investors. Regulatory changes have made private investments accessible to a wider group of investors, with strong adoption from Millennials and Gen Zs.[1] In this blog, learn more about the impact of demographic shifts on private market investments and why younger investors are turning to alternatives.

Impact of Demographic Shifts on Private Market Investments

According to a recent Hamilton Lane survey in January 2025, 56% of financial advisor plan to increase overall allocations to private markets in 2025.[2] Investors have been drawn to this asset class due to the diversification benefits and potential for return on investment. Some other key findings from the Hamilton Lane survey include:[3]

76% of advisors say clients view private markets as offering higher rewards than public equities and fixed income.
Nearly 60% of financial professionals plan to allocate 10% or more of client portfolios to private markets in 2025, a 15% increase from 2024.
Infrastructure investing is increasing, with 48% of advisors planning to increase allocations

Findings from this survey indicate that private markets are evolving beyond being a niche asset class and becoming more of a core component of modern portfolio construction.

Private Market Interest by Age Group

When breaking down private market investment allocation by age group, the shift towards alternative investments and private markets becoming by younger aged investors is apparent.

Gen Z (Ages 18-28)

The youngest cohort entering the investment world, Gen Z’s approach to investing is different than previous generations. 59% of this segment express strong interest in private markets[4] and 72% of investors aged 21-43 somewhat or strongly agree that it is no longer possible to achieve above-average investment returns by investing solely in traditional stocks and bonds.[5]

Engagement in private markets by this age group may have been driven by:

Greater access via fintech platforms and fractional investing
Desire for alternative assets (venture capital, crypto, etc)
Distrust in traditional markets

While Gen Z doesn’t yet dominate private market allocations, this interest from younger investors may be signaling a long-term shift towards alternatives due to distrust and ease of access.

Millennials (Ages 29-43)

With 89% of Millennials interested in private markets,[6] this age group is helping lead the charge towards alternatives. Also a part of the 72% that believe it is no longer possible to achieve above-average returns with traditional assets, Millennials are skeptical of traditional portfolios, likely remembering the impacts of the 2008 financial crisis. Millennials may favor investment allocations like:

Higher-growth opportunities (private equity, venture capital)
Passive income streams (private credit, real estate)
ESG-aligned investments (impact-focused funds).

Millennials are also expected to receive part of the $46T of the ~$84T that may be passed on from seniors and baby boomers, according to Bank of America.[7] [8] With a changing preference towards private market investing, Millennials may be poised to play a larger role in this asset class in the future.

Gen X (Ages 44-59)

Gen X has the largest interest in private markets of the age groups, with 94% of respondents showing interest in the asset class. This age group may be focusing on:

Private equity buyouts for long-term wealth growth
Secondary funds for liquidity in illiquid assets

Controlling a substantial portion of global wealth, Gen X is increasingly using private markets to preserve capital and generate tax-efficient returns. Expected to receive $39T in the Great Wealth Transfer,[9] Gen X’s involvement in private markets has been relatively consistent and is expected to continue.

Baby Boomers (Ages 60-78)

While 77% of Boomers are interested in private markets, they tend to be more cautious towards the asset class. Allocations may be motivated by factors like:

Inflation protection (real assets like infrastructure)
Estate planning (private equity for generational wealth)
Yield enhancement (private debt over low-yield bonds)

While boomers are gradually shifting from traditional portfolios to alternatives, they may require additional education and liquidity solutions to feel comfortable, which can be difficult with a low-liquidity asset class.

Silent Generation (Ages 79+)

Only 43% of investors over 75 are interested in private markets, primarily due to liquidity needs. However, those that do invest in private markets often focus on:

Income-generating private real estate
Stable infrastructure assets

While not a major driver of private market growth, the Silent Generation’s participation in alternatives may point to private markets gaining acceptance across all ages.

Private Market Investing Trends 2025

With the shift towards private markets, there are a few investing trends that are redefining how people invest.

Decline of the 60/40 Portfolio

Julien Dauchez of Natixis Investment Managers has stated that the classic 60% stocks, 40% bonds model has been losing interest, specifically among younger investors that are more cautious towards traditional investment models. He speculates that alternatives will be playing a larger role in portfolios moving forward, even moving to a model of perhaps 30% of an investor’s portfolio going to alternatives, an increase from the 10% previously allocated.

Education is Expanding

Despite growing interest, there are signs that there are still knowledge gaps when it comes to the industry. Financial advisors should attempt to help expand knowledge of the asset class and inform younger investors of their options, including venture capital and private equity.

Interest in Infrastructure Investing

Private infrastructure has also been gaining traction in 2025, with 48% of respondents in the Hamilton Lane survey planning to increase their exposure to the sector. As the benefits become more widely understood, this sector may continue to grow, with younger investors turning to investments in infrastructure.

Final Thoughts

With the changing markets, how can investors capitalize on this knowledge and the emerging trends? No matter what age group you fall into, private markets can offer compelling opportunities, including returns on investments, diversification benefits, and the ability to get in on the ground floor of an innovative startup. It’s important to remember that all investments involve significant risk, and private markets are considered very risky due to liquidity constraints, failure rates, and uncertainty. The demographic shift toward private markets has become apparent, and the asset class may be worth exploring for an investor’s portfolio.

Are you ready to invest in private markets? Sign up for a MicroVentures account to start investing!

SIGN UP FOR FREE

Want to learn more about investing in startups? Check out the following MicroVentures blogs to learn more:

[1] https://www.wealthmanagement.com/alternative-investments/why-younger-investors-are-embracing-private-marketsA

[2] https://www.familywealthreport.com/article.php/Private-Market-Allocations-To-Rise-In-2025-%E2%80%93-US-Study-?id=203471#:~

[3] https://www.hamiltonlane.com/en-us/news/private-wealth-survey-2025

[4] https://www.hamiltonlane.com/en-us/news/private-wealth-survey-2025

[5] https://ustrustaem.fs.ml.com/content/dam/ust/articles/pdf/2024BoA-PB_Study_of_Wealthy_Americans.pdf

[6] https://www.hamiltonlane.com/en-us/news/private-wealth-survey-2025

[7] https://www.ml.com/articles/great-wealth-transfer-impact.html

[8] https://ustrustaem.fs.ml.com/content/dam/ust/articles/pdf/2024BoA-PB_Study_of_Wealthy_Americans.pdf

[9] https://www.ml.com/articles/great-wealth-transfer-impact.html

*****

The information presented here is for general informational purposes only and is not intended to be, nor should it be construed or used as, comprehensive offering documentation for any security, investment, tax or legal advice, a recommendation, or an offer to sell, or a solicitation of an offer to buy, an interest, directly or indirectly, in any company. Investing in both early-stage and later-stage companies carries a high degree of risk. A loss of an investor’s entire investment is possible, and no profit may be realized. Investors should be aware that these types of investments are illiquid and should anticipate holding until an exit occurs.

MicroVentures Blog