Private Credit: The Next Evolution of Global Capital
Private credit has rapidly emerged as a central pillar of modern capital markets. Since 2020, the asset class has more than doubled in the U.S., growing from roughly $500 billion to about $1.3 trillion and now accounting for nearly 30% of below-investment-grade corporate lending, while the broader leveraged finance market has reached approximately $4.2 trillion. As banks retreat from certain lending activities and demand for capital expands private credit is increasingly becoming a core allocation in wealth portfolios.
Wealthtech platforms like InvestCloud are playing an increasingly critical role in this evolution. Jody Cullinan, VP of product management at InvestCloud discusses how the platform helps advisors source opportunities, manage complex private market assets, and deliver institutional-grade investment access to a broader investor base.
CM: How has InvestCloud observed the integration of private credit into wealth management portfolios, particularly with infrastructure assets?
JC: We’re seeing private credit move from a niche holding to becoming part of the strategic income and diversification allocation within model portfolios. It is now sitting alongside public fixed income and equities, with a clear role in income diversification and inflation protection.
CM: Can you discuss recent collaborations, such as with Apollo, and how they enable wealth managers to access private market models for infrastructure and credit?
JC: Our collaborations with firms like Apollo, which have traditionally connected institutional-quality private market assets to ultra-high-net-worth investors, are helping bring private credit and infrastructure into model portfolios. They are creating new products with lower minimums, allowing these investments to move further downstream into wealth portfolios. This enables advisors to both expand client access to these instruments and allocate through models, rather than relying on one-off, exception-based deals.
CM: With leveraged finance reaching about $4.2 trillion, how do you see the balance between traditional bank lending and private credit evolving over the next decade?
JC: What we’re seeing is that private credit will complement, not replace, traditional bank lending. In the context of wealth management, it becomes another tool in the advisor’s toolkit, helping provide income stability. Over the next decade, we see a hybrid market structure: banks focus on relationship-based and regulated balance-sheet lending, while private credit funds take a larger share of sponsor-backed deals, infrastructure, and energy transition projects. We see the wealth channel becoming an important source of capital as high-net-worth and mass-affluent investors gain access to private credit via regulated solutions and broadening the investor base for issuers.
CM: Infrastructure and energy transition projects increasingly rely on private capital. How is private credit helping fill financing gaps in these sectors?
JC: Private credit is stepping into areas where projects need long-duration, flexible financing that doesn’t always fit neatly on bank balance sheets. Private credit can underwrite complexity and structure flexibility – for example, combining construction risk, phased drawdowns and contracted revenue streams – in ways that are harder for traditional banks to accommodate. Our role is to connect wealth capital to these opportunities through digital platforms, enabling investors to participate in financing real-economy projects while maintaining robust risk, reporting, and governance frameworks.
CM: Wealth managers are increasingly looking to integrate private market investments directly into client portfolios. What technological capabilities are required to make that seamless?
JC: This is a major focus for us: how to manage public and private assets seamlessly within the same account. First, data needs to be normalized. Advisors need the ability to rebalance portfolios, enabling true asset allocation and holistic portfolio management across both public and private holdings. Proper valuations must be in place, along with automated workflows that determine when to rely on private markets for cash flows within broader allocation strategies.
Model-based approaches are essential for scaling, rather than relying on one-off solutions. In addition, robust cash flow forecasting and liquidity management are needed so advisors can plan around capital calls, distributions, and lockups without creating operational friction.
There is also a strong need for advisor and investor education, along with improvements in user experience. Today, the process is largely exception-based and paper-based. What we’re seeing is a shift toward standardization and full digitization of the private markets lifecycle, including private credit.
CM: How are RIAs and private banks changing their approach to portfolio construction as private credit becomes a more core allocation?
JC: Portfolio construction is shifting from the traditional 60/40 fixed income–equity model toward a more outcome-oriented approach, where private markets are core to the allocation. For example, what was once a 40% fixed income allocation, split between Treasuries and corporates, is now evolving to include private credit as part of that mix.
Private credit is becoming a truly embedded asset class in traditional portfolio construction. It is no longer held separately as an exception-based investment, but instead is integrated into overall portfolio construction, income forecasting, and diversification strategies. It is simply another asset class within the advisor’s toolkit.
CM: Do you have any final thoughts to share?
JC: The key point here is the need for digitization. Historically, private credit has operated through one-off, deal-by-deal processes for institutional and ultra-high-net-worth investors. However, to unlock the full pool of capital available from the wealth segment, and to provide that segment with access to these products, we need to scale the process.
Today, that process is not scalable. To drive broader adoption in wealth management, we need to fully digitize the lifecycle of private market investments. That includes expanding offerings, enabling platform access through consistent data, and moving away from document-based workflows toward the discretionary, model-driven processes that already exist in wealth management and managed accounts.