Apollo's Rowan Warns About 'Shakeout' in Private Markets

• A 'correction' or 'shakeout' is coming in private markets, similar to what happened in banking where good risk managers emerged stronger.
• Firms that took on more risk, lent to smaller companies, used more leverage, or concentrated in specific sectors (like tech) will face difficulties.
• Successful firms will be those that focused on first-lien, cash-pay, large companies, and low leverage, positioning themselves as 'risk off'.
• The shakeout is driven by a '30% overhang' of geopolitics, inflation, and technological change, and is expected to be long-term, leading to industry consolidation.

Marc Rowan, CEO of Apollo Global Management, warns of an impending 'shakeout' in private markets, likening it to the banking crisis. He emphasizes the importance of good risk management, low leverage, and diversified portfolios, predicting that firms that were 'risk off' during the boom will thrive during the correction.