Schroders Capital Bets Big on Continuation Funds as Private Markets Boom

Schroders Capital is positioning continuation funds as a strategic priority, forecasting a fourfold surge in investment volumes to over $300bn by 2034. CIO Nils Rode emphasizes these vehicles as alternatives to premature exits, targeting high-performing assets that WOULD otherwise be sold to rival funds or IPO candidates.

The private markets division reports a 27% CAGR for continuation deals since 2013, with cyclical tailwinds driving 17% of 2024's transaction volume. The structure allows GPs to transfer select assets to new funds while offering existing investors liquidity or reinvestment options.

Rode dismisses concerns about underperforming assets being repackaged, stating the focus remains on 'investments kept for the right reason.' The growth projection reflects both institutional demand and structural supply-side expansion in private markets.