For the last three weeks, I have been building a foundation.

I started by introducing The Market You Don’t See, because I believe one of the most important parts of our financial system remains one of the least understood.

Then we went back to the period before the JOBS Act, when much of private capital formation was relationship-driven. I described it as a market that was largely “by appointment only.”

In Week 3, we looked at what changed after the JOBS Act and how RegD, RegCF, RegA+ and technology began changing the way companies and investors could connect.

Now we arrive at the question I hear repeatedly:

How big is the private capital market?

There is no single number that answers that question.

That is the first thing investors need to understand.

Depending on who is measuring it, “private markets” can include private equity, venture capital, private credit, private real estate, infrastructure, hedge funds, privately offered securities, exempt offerings and other investment structures.

Some statistics measure capital raised during a period.

Others measure assets under management.

Others measure transaction value.

Those are not interchangeable.

If somebody puts all of those numbers together and gives you one enormous figure, be careful.

Understanding the private capital markets requires understanding what the numbers actually represent.

But once we do that, the conclusion is difficult to ignore:

Private capital is not a niche market.

It is a major component of the global financial system.

And the numbers are extraordinary.

Start With One Number: $2.39 Trillion

According to the SEC, approximately $2.3915 trillion was reported as raised through RegD offerings during 2025.

There were 34,553 initial RegD filings during the year.

Read that number again.

$2.39 trillion.

But before anyone turns that into a headline saying “private companies raised $2.39 trillion,” we need to understand what the number means.

RegD includes both operating companies and pooled investment funds.

That means the total includes capital reported by hedge funds, venture capital funds, private equity funds, and other investment funds, as well as non-fund issuers such as operating companies and financial firms. The SEC specifically separates fund and non-fund issuers in its data.

That distinction matters.

This is exactly why I believe investor education is so important.

A large number can attract attention.

Understanding what is behind the number creates knowledge.

There is another qualification.

RegD statistics are based on Form D filings and amendments. The SEC itself cautions that its statistics may underestimate the actual number of offerings and amount of capital raised because some issuers relying on Regulation D may not file Form D as required.

So $2.39 trillion should neither be exaggerated nor dismissed.

It tells us something very specific:

An enormous amount of capital formation is occurring through exempt securities offerings.

And 2026 Is Continuing the Story

This is not simply historical data.

Through the first half of 2026, the SEC recorded:

• 9,918 initial RegD filings in Q1
• 10,513 initial RegD filings in Q2.

That means 20,431 initial RegD filings in only six months.

This is one of the reasons I keep challenging people to change the way they think about the capital markets.

When someone says “the market,” most people immediately think:

• NYSE.
• Nasdaq.
• S&P 500.
• Dow Jones.
• Public equities.

But capital formation is much larger than what appears on a stock-market screen.

Public Markets Are Visible. Private Markets Are Distributed.

This is one of the fundamental differences between the two markets.

Public markets have centralized visibility.

If I ask you what Apple is trading at, you can find the answer in seconds.

If I ask you what happened to the Nasdaq today, the information is everywhere.

• Prices.
• Volume.
• Market capitalization.
• Analyst coverage.
• SEC filings.
• News.
• Historical charts.
• Ownership data.

Everything has been organized around making the public market visible.

Now try doing the same thing for the entire private capital market.

You cannot.

• There is no single ticker.
• There is no single exchange.
• There is no universal private-market database containing every transaction.
• There is no screen showing every private company raising capital.
• There is no consolidated real-time price for a private company's shares.
• That doesn't mean the market isn't there.

It means the market is distributed.

And I believe this difference between economic importance and public visibility is one of the reasons private capital remains so misunderstood.

Follow the Money Beyond RegD

RegD is only one part of the picture.

If we want to understand private capital, we have to look at the different places capital is moving.

• Private equity.
• Venture capital.
• Private credit.
• Infrastructure.
• Private real estate.
• Growth capital.
• Family offices.
• RegD.
• RegCF.
• RegA+.

Each represents a different piece of the market.

And each exists for a different reason.

This is not one market with one type of investor buying one type of security.

It is an ecosystem.

Private Equity: Capital and Ownership

Private equity is probably the segment most people recognize.

At its simplest, private equity involves investing capital into companies that are not publicly traded, frequently with the objective of improving the business and ultimately realizing value through a sale, recapitalization, another transaction or public offering.

But the private equity market itself is enormous and diverse.

• Buyouts.
• Growth equity.
• Middle-market investments.
• Sector-focused strategies.
• Operational turnarounds.
• Co-investments.
• Secondaries.
• Continuation vehicles.

And many other strategies.

BCG's 2026 analysis, using Preqin data, estimated total private-market assets under management at approximately $16.1 trillion in the first half of 2025, with private equity representing the largest component at roughly 44%.

Think about that.

We are no longer talking about an alternative corner of finance.

We are talking about trillions of dollars of managed assets.

Venture Capital: Financing What Does Not Yet Exist

Venture capital plays a very different role.

Venture investors frequently provide capital to companies that are still developing products, markets and business models.

The risk can be substantial.

Many companies will fail.

Others will survive without producing exceptional returns.

A small number can create enormous value.

Venture capital has played an important role in financing innovation because traditional lending is often poorly suited to early-stage companies.

A company with limited revenue, limited physical assets and significant technology-development costs may not satisfy the requirements of a conventional lender.

Equity capital can fill that gap.

This is an important concept.

Different types of capital exist because companies have different needs at different stages.

A startup does not have the same financing requirements as a mature manufacturer.

A real-estate project does not have the same capital structure as a software company.

A growth-stage healthcare company does not have the same requirements as an infrastructure project.

Private capital provides flexibility that can be difficult to achieve through one standardized market structure.

Private Credit Has Become Too Large to Ignore

One of the most important developments in private markets has been the expansion of private credit.

The Alternative Credit Council estimated that global private-credit assets under management had reached approximately $3.5 trillion, based on its 2025 research. It estimated $592.8 billion of private-credit capital deployment in 2024, a 78% increase from the prior year.

Private credit is also no longer simply corporate direct lending.

The market includes corporate lending, asset-backed lending, real-estate debt, infrastructure debt and other strategies. The ACC estimated corporate lending represented approximately 60% of the market, with other strategies accounting for the balance.

McKinsey's 2026 work shows how the market continues to evolve. Closed-end private-credit fundraising was approximately $165 billion in 2025, while evergreen and open-end private-credit AUM grew about 27% year over year.

That last point deserves attention.

Capital isn't only moving into different investments.

The structures through which investors access private investments are changing.

That will matter enormously over the next decade.

Infrastructure Is Becoming a Private-Market Story

Infrastructure provides another example of how the definition of private markets is expanding.

When people hear infrastructure, they may think of roads, bridges and airports.

Those remain important.

But modern infrastructure increasingly includes:

• Data centers.
• Power generation.
• Energy infrastructure.
• Fiber networks.
• Digital infrastructure.
• Transportation.
• Utilities.
• Renewable energy.
• Communications.

The physical systems required to support AI and digitalization.

BCG reported that private infrastructure assets under management reached approximately $1.6 trillion in the first half of 2025, representing roughly 10% of private-market assets in its dataset. Infrastructure fundraising reached approximately $211 billion during 2025.

Why does this matter?

Because some of the largest technological changes we are discussing today require enormous amounts of physical capital.

• AI does not exist only in software.
• AI needs data centers.
• Data centers need power.
• Power requires generation and transmission.
• Networks require fiber.
• Physical infrastructure requires financing.
• That capital has to come from somewhere.

Increasingly, private capital is part of that answer.

Private Markets Are Moving Closer to Individual Investors

Another important development is occurring.

Historically, large portions of private markets were dominated by institutions.

• Pension funds.
• Endowments.
• Insurance companies.
• Sovereign wealth funds.
• Family offices.
• Large asset managers.

That is beginning to change.

Private-market managers are increasingly looking toward wealth-management channels and high-net-worth investors.

McKinsey has documented increasing use of evergreen, semi-liquid and other structures designed to broaden access beyond traditional institutional closed-end funds.

RegCF provides another example at a different end of the market.

Under current SEC rules, eligible companies can raise up to $5 million in a 12-month period through RegCF, with transactions conducted online through an SEC-registered broker-dealer or funding portal.

RegA+ creates another pathway. Tier 1 permits offerings up to $20 million in a 12-month period, while Tier 2 permits up to $75 million.

We therefore have several developments happening simultaneously.

Institutional private markets continue to be enormous.

Wealth channels are expanding.

Digital capital formation continues developing.

And regulatory pathways are allowing different categories of companies and investors to interact.

That does not mean private markets have suddenly become public markets.

They haven't.

It means the boundary between who historically had access to private investments and who may have access in the future is evolving.

Why Are Companies Staying Private?

This is another important part of the story.

If enormous pools of capital are available privately, companies have more financing choices.

Historically, going public was an important way for a growing company to access substantial capital.

It still is.

Public markets can provide significant advantages: access to capital, liquidity, visibility, acquisition currency and broader ownership.

But an IPO also brings responsibilities and costs.

• Public reporting.
• Governance.
• Disclosure.
• Market expectations.
• Quarterly scrutiny.
• Investor relations.
• Regulatory obligations.

When substantial capital can be obtained privately, companies may have greater flexibility regarding when, or whether, they enter public markets.

That does not mean public markets are becoming irrelevant.

I believe the better way to look at this is:

The capital lifecycle is becoming longer and more diverse.

• A company may begin with founders.
• Then friends and family.
• Angel investors.
• Venture capital.
• Growth equity.
• Private credit.
• Private equity.
• A larger private placement.
• And perhaps eventually an IPO.
• Or an acquisition.
• Or another liquidity event.
• Public and private capital should not necessarily be viewed as competitors.

They can be different stages of the same company's capital journey.

Investors Need to Understand What “Private” Actually Means

• This is where I want to slow down.
• Large numbers create excitement.
• They should also create questions.
• Private does not mean superior.
• Private does not mean safer.
• Private does not automatically mean higher returns.
• And private certainly does not mean guaranteed returns.
• Private securities can involve substantial risk.
• Information can be more limited than it is for publicly reporting companies.
• Valuations can be difficult to establish.
• Securities may be restricted.
• There may be no secondary market.
• An investor may have to hold the security for years.
• Dilution can occur.
• Management can fail.
• The business can fail.
• The investor can lose the entire investment.
• This is why I believe access and education must grow together.
• Giving somebody access to an investment without helping them understand the investment is not democratization.
• It is simply distribution.
• There is a difference.

Follow the Money, But Follow the Risk Too

One of the lessons I have learned from working in capital markets is that money never moves alone.

• Risk moves with it.
• Information moves with it.
• Compliance moves with it.
• Ownership moves with it.
• Responsibilities move with it.

If trillions of dollars are moving through private markets, then we should also be asking:

• Who verifies the investor?
• Who performs the required compliance?
• Who verifies the company?
• Who holds the money?
• Who records the ownership?
• Who maintains the shareholder records?
• Who communicates with investors?
• Who processes distributions?
• Who handles transfers?
• Who maintains regulatory records?
• Who provides liquidity?
• Who ensures the buyer is permitted to purchase?
• Who ensures the seller is permitted to sell?

These questions become more important as the market becomes larger.

Not less important.

This Is Where the Infrastructure Question Begins

Consider what happens when an investor decides to invest $25,000 in a private company.

From the investor's perspective, the transaction might look simple.

• Find offering.
• Review information.
• Click invest.
• Complete forms.
• Send money.
• Receive confirmation.

But underneath that experience, an enormous number of things may need to happen depending on the offering and participants involved.

• Identity.
• KYC.
• AML.
• Sanctions screening.
• Investor qualification.
• Accreditation verification where applicable.
• Suitability where applicable.
• Subscription agreements.
• Electronic signatures.
• Payment processing.
• Escrow.
• Closing.
• Securities issuance.
• Ownership registration.
• Transfer restrictions.
• Cap-table updates.
• Transfer-agent records.
• Investor communications.
• Tax documentation.
• Distributions.
• Corporate actions.

Eventually, perhaps a transfer or secondary transaction.

The larger private markets become, the less sustainable it is for every component of that lifecycle to exist in isolation.

That is why the growth numbers interest me.

Not because a trillion-dollar statistic makes a good headline.

It is because scale exposes infrastructure requirements.

The Public Markets Already Learned This Lesson

Public markets appear simple because decades of infrastructure sit underneath them.

When you buy a publicly traded security, you don't spend your day thinking about market data feeds, clearing systems, settlement infrastructure, transfer agents, custodians, broker-dealers, exchanges, compliance systems and corporate-action processing.

You see a button.

BUY.

But the button is not the market.

Everything behind the button is the market.

Private markets are going through their own infrastructure evolution.

We have become very good at putting the INVEST button online.

Now we have to connect everything behind it.

That, in my view, is the next chapter.

More Capital Means More Investors. More Investors Mean More Complexity.

Consider an issuer that historically raised $10 million from 15 investors.

Now imagine a company raising capital digitally from 2,000 investors.

The amount of capital may be similar.

Operationally, those are entirely different companies.

Two thousand investors mean potentially thousands of:

• Identity records.
• Compliance records.
• Transactions.
• Ownership positions.
• Communications.
• Tax records.
• Distribution instructions.
• Voting rights.
• Corporate actions.
• Transfer requests.
• Support interactions.

That is why digital capital formation creates an infrastructure requirement that traditional relationship-based private capital did not experience at the same scale.

We did not merely digitize fundraising.

We changed the potential number and type of relationships an issuer must manage.

Liquidity Is the Next Question

As more investors own private securities, another question becomes inevitable:

How do I eventually sell?

This is where I believe secondary markets will become increasingly important.

But we need to be careful with the word liquidity.

Creating a trading venue does not guarantee liquidity.

• There still needs to be a buyer.
• There needs to be price discovery.
• There may be transfer restrictions.
• The security may be restricted.
• Investor eligibility may matter.
• Compliance may need to be performed.
• Ownership records need to change.
• Funds need to settle.
• The issuer's governing documents may matter.
• Securities laws still apply.

Liquidity is not created simply because we put a SELL button beside the BUY button.

The infrastructure behind the transaction matters.

Again.

Tokenization Does Not Make These Requirements Disappear

I hear another argument frequently:

Blockchain will solve this.

I believe blockchain and tokenization can become important parts of private-market infrastructure.

But tokenization does not eliminate securities law.

• A security does not stop being a security because ownership is represented digitally.
• A token does not eliminate the need to know who owns the security.
• It does not eliminate transfer restrictions.
• It does not eliminate compliance.
• It does not eliminate the need for accurate records.

The real opportunity, in my view, is much more interesting.

It is the possibility of using blockchain technology to improve ownership infrastructure, interoperability, auditability and transactions while maintaining the regulatory controls required for securities markets.

That is very different from using technology to avoid regulation.

AI Will Make the Data Question Even More Important

Artificial intelligence will also have an enormous impact on private markets.

• But AI needs data.
• Good data.
• Structured data.
• Trusted data.
• Verified data.
• Connected data.

The private markets historically have not had the same level of standardized, centralized information available in public markets.

That creates both a problem and an opportunity.

• AI can potentially help investors analyze information.
• It can help compliance teams identify anomalies.
• It can help companies understand shareholders.
• It can help regulated intermediaries manage exceptions.
• It can improve document review.
• It can help detect patterns that humans may miss.

But AI cannot magically correct poor underlying data.

If private markets are going to become increasingly intelligent, they first need to become increasingly connected.

My View: We Are Watching the Private Markets Become a Financial System of Their Own

This is the conclusion I want readers to take from the numbers.

The story is not that $2.39 trillion was reported raised under RegD in 2025.

That is an important statistic, but it is not the story.

The story is that private capital has become too economically significant to continue treating its infrastructure as an afterthought.

Private equity is enormous.

Private credit has grown into a multitrillion-dollar asset class.

Infrastructure investment is expanding.

Private wealth is becoming increasingly involved.

Digital capital formation has created new distribution models.

RegCF and RegA+ have expanded pathways for companies and investors.

Secondary markets are developing.

Tokenization is advancing.

AI is arriving.

Every one of these developments creates another requirement for the systems underneath the market to communicate.

That is why my thesis remains:

We opened the market before we finished building the infrastructure.

The first stage was access.

The second stage was digitization.

I believe the next stage is connection.

Identity needs to connect with compliance.

Compliance needs to connect with the transaction.

The transaction needs to connect with payments.

Payments need to connect with issuance.

Issuance needs to connect with ownership.

Ownership needs to connect with communications.

Ownership also needs to connect with transfers.

Transfers need to connect with secondary markets.

And all of it needs reliable data and regulatory records.

That is what a market looks like when it begins to mature.

The Opportunity Is Not Just More Investments

When people hear that private markets are growing, the immediate question is often:

What should I invest in?

I believe there is a more fundamental question:

What has to exist for this market to function?

That is where I have spent much of my career.

Not predicting which company will become the next unicorn.

Not telling investors which security they should purchase.

Building and thinking about the infrastructure required for companies, investors and regulated intermediaries to participate in private capital markets.

Because when trillions of dollars are moving through a market, the infrastructure underneath that movement becomes increasingly important.

The gold rush analogy is sometimes used in technology: don't only look for gold, look at the picks and shovels.

I would frame it differently.

Don't only follow the investment. Follow what makes the investment possible.

That is where some of the most important changes in private capital are happening.

What I Want You to Take Away

If you remember only a few things from this article, remember these.

The private capital markets are not one market. They are an ecosystem encompassing different securities, asset classes, investors, intermediaries and regulatory pathways.

Do not mix capital raised, assets under management and transaction volume. They measure different things.

RegD alone reported approximately $2.39 trillion of capital raised in 2025, but much of that amount came through pooled investment funds, so it should not be represented as $2.39 trillion raised directly by private operating companies.

Global private-market AUM has reached a scale measured in the tens of trillions under major industry datasets, with BCG/Preqin estimating approximately $16.1 trillion as of the first half of 2025.

Private credit and infrastructure demonstrate that the market is broadening beyond the private-equity and venture-capital categories most people traditionally associate with private markets.

And greater access does not remove risk.

It increases the importance of education, transparency, compliance and infrastructure.

That last point may be the most important one.

What Comes Next

We have now followed the progression.

First, the private markets were difficult for most people to see.

Then we looked at why they developed as a relationship-driven market.

Then we looked at how the JOBS Act began changing access.

Now we have followed the money and seen the scale.

Next week, I want to move underneath the market.

Because there is a question I have been asking for years:

Why is private investing still so complicated?

Why does an investor repeatedly provide the same information?

Why are identity and compliance disconnected?

Why do payments live somewhere else?

Why are ownership records fragmented?

Why are issuers using multiple systems to manage one investor?

Why can we digitally acquire an investor but still struggle to move information efficiently throughout the lifecycle of the security?

And why, after more than a decade of digital capital formation, does so much of the private market still operate as disconnected pieces?

Next week:

The Private Markets Have a Plumbing Problem

We are going underneath the INVEST button.

That is where I believe the next major opportunity in private capital markets begins.

Oscar A. Jofre
Co-founder & CEO
KoreInside

THE MARKET YOU DON'T SEE

with Oscar A. Jofre

Education. Insight. Infrastructure.