As 2025 nears its end, private equity firms are facing the fourth year of a slide in fundraising. During the first nine months these funds have raised $906.9 billion, down from more than $1.7 trillion in 2022, the year fundraising first began to decline, according to new data from PitchBook.
Hilary Wiek, senior strategist at PitchBook, noted that both the number of funds closing and the amount of capital raised remain weak.
Overall, $1.24 trillion has been gathered based on trailing fourth-quarter numbers, which is a 23 percent decline year over year. Venture capital has fared the worst, bringing in only $140.4 billion, a 42.5 percent decline. Meanwhile private equity fundraising of $440 billion represents a 32.3 percent decline over the past 12 months. Private credit funds raised $218 billion, a nearly 17 percent decline.
The only positive trend over the past year was secondaries, which raised $122.6 billion, a 22 percent increase, and co-investment funds, which raised $43.5 billion, a 24 percent increase.
“Secondaries have come a long way,” said PitchBook research analyst Juan Mier. “Not long ago, this was a niche strategy for offloading fund stakes in tough times. Today, secondaries are firmly established as a key tool for portfolio management in private capital allocations.”
He noted that with three months remaining, “secondaries are on track for a record-breaking fundraising year in 2025 [as] the $105 billion raised so far in 2025 has practically matched the 2024 record.”
But there have been other challenges in private markets.
A key factor is the continued growth of dry powder across the industry. Deals have picked up, but Wiek said that “an even more robust deal market may be required to put committed but uncalled capital to work in the coming years.”
“Sizable exit backlogs remain,” added PitchBook analyst Kyle Waters.
Venture capital, the hardest hit strategy, is facing its third down year. “This comes as no surprise, given the shift in market conditions away from a glut of exits, subsequent distributions, and re-up commitments for new funds,” said Nalin Patel, director of research for EMEA private capital at PitchBook.
He explained that venture capital relies heavily on big returns to keep new capital flowing because the asset class is highly illiquid. As a result, fundraising will remain difficult until exit activity improves significantly.
Patel also said it’s tougher for general partners to close a new VC fund, which now takes a record 17.5 months on average. “While fluctuations are expected as the year progresses, a longer period clearly indicates that it is becoming increasingly difficult to secure commitments to meet a fund’s target size.”
As has been the case for some time, the biggest funds are faring better than others.
“In a quick tally of the press releases from the 15 largest PE funds to hold a final close in Q3 2025, 10 explicitly said they beat their target, nine said they hit their hard cap, and seven said they were oversubscribed — generally language that would indicate a great fundraising environment,” said Wiek. “This appears to support the idea that the big funds are doing fine despite many industry participants saying it has been a difficult fundraising environment.
She said it’s hard to know how the biggest VC funds fared, as “they are much less likely to put out press releases when they close a deal. But for the top 15 VC funds that closed, six had a fund size the same as or smaller than the prior fund.” She called that “potential warning sign for a struggling fund manager.”
