Private Markets Ops Crisis: Technology Now the Top Internal Challenge

What's New

Gen II's Core Alternative Managers' Mood Index reveals that technology has overtaken talent as the single biggest internal challenge facing private market fund managers, with 27% of respondents citing systems, data quality and reporting speed as their primary pain point. The Q4 2025 survey returned an overall score of 56.56, signaling continued optimism that investor allocations will grow over the next 12 months across UK and European markets.

Why It Matters

For private markets CFOs and COOs, this shift is a structural warning. LP scrutiny has migrated from investment performance to operational integrity, meaning managers who cannot demonstrate institutional-grade infrastructure are now at a measurable fundraising disadvantage, not just an operational one.

Big Picture Drivers

• Technology pressure. CFOs are being asked to deliver faster, more transparent reporting and stronger controls without a corresponding rise in cost, forcing hard choices about systems and outsourcing.

• Selective capital. Fundraising cycles are stretching, first closes are harder to secure, and there is nearly a 20-percentage-point gap between the highest and lowest allocation expectations across asset classes.

• Liquidity complexity. 53% of respondents are already using or planning continuation vehicles, creating multi-speed portfolio economics that legacy single-strategy infrastructures are not built to handle.

• Investor due diligence shift. LPs are no longer asking only what you deliver. They want to know how the business that delivers it actually operates, with cybersecurity (60%), cash management (52%) and ESG (30%) now front-line DDQ priorities.

• Macro uncertainty. 34% of managers cite political uncertainty as a leading external concern, with recession risk (24%) and global regulation (11%) compounding forecasting complexity and deployment velocity pressure.

By The Numbers

• 56.56 — CAMMI Q4 2025 overall score, above the 50 threshold indicating expected allocation growth

• 27% — Share of managers citing technology as their top internal challenge, surpassing talent for the first time

• 53% — Managers already using or planning continuation vehicles

• 60% — Respondents citing cybersecurity as the top investor due diligence priority

• 46% — Highest allocation increase expectation, led by Real Estate and Infrastructure

Key Trends to Watch

• Technology consolidation pressure will intensify. Managers still relying on headcount to fill system gaps are falling behind peers who have automated reporting accuracy and eliminated manual processes.

• Capital concentration will widen the strategy gap. With Private Debt at 40% and Buyout at 37% versus lagging strategies, the managers not in favored asset classes will face increasingly competitive LP relationships.

• Continuation vehicles are moving from niche to norm. The 53% adoption rate signals that governance and reporting frameworks built for traditional exit timelines are already being stress-tested.

• Operational credibility is becoming a fundraising metric. DDQ responses that do not clearly address cybersecurity controls, cash governance and outsourcing oversight will be a liability in the next fundraising cycle.

The Wrap

The CAMMI 05 results reframe what private markets operational excellence actually means in 2025 and beyond. The CFO and COO mandate has expanded from financial stewardship to technology leadership, governance architecture and LP-facing transparency. Managers who treat operational infrastructure as a back-office concern will find themselves structurally disadvantaged in a fundraising environment where capital is concentrating fast and LP scrutiny is higher than it has ever been.