Why Public Markets Don't Look Like They Used To

Annual letters from some of the world’s biggest investment firms have become so closely followed they now spark news cycles of their own. Whether your preferred muse is Larry Fink, Jamie Dimon or Marc Rowan, they’re all sounding the same alarm: Public markets may not be what they used to be.

There are a few numbers many people know. The count of U.S. public companies has been cut nearly in half over the past two decades — from about 8,000 in the ‘90s to just 4,000 today.¹ And stock markets have grown more concentrated than ever, with just 10 companies now making up 40% of the S&P 500’s total value.²

But new, unsettling figures seem to surface every day. One stands out: Nearly nine in 10 companies with at least $100 million in annual revenue are private. It’s a sea change from the old days of investing.³

For many individual investors, it adds up to this: Your portfolio probably reflects much less of the economy than it used to. But it doesn’t have to stay that way.

For the first time, the largest and fastest-growing part of the economy⁴ — the private markets — is broadening its access to individual investors. Let’s unpack what these markets are and how investors can think about this expanded access.

Where did all the public companies go?

Public markets have shrunk by nearly half over the past two decades, but there aren’t necessarily fewer U.S. companies. Where did they all go? For the most part, into the private markets.

Over that same 20 years, the number of private equity–backed companies grew from about 1,900 to more than 11,000 — a nearly 500% jump.⁵ And today, there are roughly six times as many private “unicorns” (companies with a $1 billion valuation) as there are public companies with an equivalent market cap.⁶

For many institutions and the ultra-wealthy, that growth has proved attractive. Assets held by private equity expanded fifteenfold between 2000 and 2022.⁷ And among individual investors with more than $10 million in assets, about 80% now allocate to private markets.⁸

Before we toss out any more numbers, you might be wondering: Why haven’t any of these private investments ever crossed my desk?

For a long time, they were simply off-limits. Regulations and old-school private equity norms meant that unless you were ready to cut a multimillion-dollar check, you likely weren’t getting into one of these funds.⁹

Today, though, new products and federal rule changes are cracking that door open for individual investors.¹⁰ You no longer have to be a pension fund, Fortune 500 CEO, other institutional or ultra–high-net-worth investor to diversify into categories like private equity and private credit. One of the platforms leading that shift is Crowd Street, a marketplace for self-directed access to private assets.

How Crowd Street is expanding access to private markets

For more than a decade, Crowd Street has enabled accredited investors to build portfolios in commercial real estate. Today, we have expanded our offering to a broader range of private market opportunities, including private equity, private credit and venture capital.

To do it, Crowd Street has entered into a strategic relationship with Callan, one of the world’s leading institutional investment consultants, who will support Crowd Street by helping review and conduct diligence for select private market investment opportunities. They’ve also launched distribution agreements with top global asset management firms to offer investments traditionally reserved for their institutional and high-net-worth clients.

Private assets, like public ones, come with both opportunities and risks. It’s true that they’ve grown faster and larger than their public counterparts in recent decades — but that growth doesn’t guarantee safety. It's important for investors to understand that the investment opportunities on the Crowd Street Platform are speculative and involve substantial risk. Investors should not invest unless they can sustain the risk of loss of capital, including the risk of total loss of capital.

Crowd Street represents opportunity: The chance to diversify beyond concentrated public stocks, to invest across the broader economy, and to participate in similar types of assets that institutions and the ultra-wealthy have for decades.

For the first time, these opportunities are in your hands. And Crowd Street is there to support you along the way. Visit crowdstreet.com to discover how.