Evergreen funds are pushing private markets toward a wider investor base. Olivier Dauman of CA Indosuez says that expansion has clear limits. “I think evergreen is a nice evolution of this market. I don’t think it’s the El Dorado of private equity,” he told Investment Officer.
Dauman, global head of investor relations for private markets at CA Indosuez, speaks from inside the market. Indosuez has been managing evergreen funds for six years. His message is direct: evergreen works when the assets, the liquidity terms and the client profile fit together.
Evergreen funds stay open, accept fresh capital over time and often give investors periodic exit windows. That makes them easier to distribute than traditional closed-end private market vehicles. The underlying assets, however, remain hard to sell quickly. That tension now sits at the heart of the debate around semi-liquid funds.
Recent redemption pressure at US-based private credit funds run by Blue Owl, Blackstone and Blackrock has sharpened that debate. Critics call the model “phantom liquidity” and argue that private markets and easy exits do not naturally align. Supporters say redemption caps and gates are part of the structure and protect investors who remain in the fund.
‘Not suitable for certain strategies’
Dauman sits between those positions. He accepts the format. He also says managers risk pushing it too far, especially as weaker fundraising in traditional closed-end funds drives firms toward private banks and wealthy clients in search of fresh capital.
“I personally don’t believe any GP should be launching an evergreen solution just because an evergreen solution is not suitable for certain strategies,” he said.
His caution matters because evergreen structures have become one of the industry’s main responses to a tougher fundraising climate. They also fit into the broader push to open private assets to wealthy families and, through vehicles such as ELTIFs, to a wider client base. Dauman’s point is simple: stronger demand does not erase structural limits.
For the Indosuez executive, the central issue is fit. “What we are testing here and right now is clearly the definition of semi-liquid,” he said. A fund can offer quarterly or periodic liquidity only with enough diversification in the portfolio and breadth in the investor base. Once that spread narrows, the liquidity promise starts to weaken.
Not for buyout funds
That is why he sees some strategies as more natural candidates for evergreen formats than others. In his view, secondaries, private credit and some infrastructure strategies work better because they offer broader diversification, a yield component, or both. Direct venture or buyout funds are harder to fit into that structure, because they often own only a handful of companies and they have a potentially long holding period.
“If you are doing direct buyouts in Europe and if you do two or three deals every year, there is no way you can get the right level of diversification through an evergreen structure,” he said.
Indosuez itself treats evergreen as one format among several. Dauman said the group offers semi-liquid funds alongside closed-end vehicles, feeder structures, discretionary mandates and dedicated sub-funds for larger clients. He also described distribution as a filtered process, with private bankers and investment advisers helping decide which clients should be offered a product.
That selection process is central to his case. Dauman said many client meetings end with the conclusion that a private market product does not fit the investor’s needs. For private bankers and wealth managers, that is a better test than simply asking whether a client can redeem. The real issue is whether the assets inside the fund can support the liquidity needs of the client.
Gates as a safeguard
Dauman is also calm on gates. These mechanisms limit withdrawals when too many investors ask for cash at the same time. Some recent coverage has treated gates as proof that evergreen liquidity is illusory. He sees them as a safeguard. “Again, we believe as managers of evergreen funds that it’s the right protection for the existing investors,” he said.
Problems arise, he said, when investors hear “semi-liquid” and assume daily-style access to cash.
He also points to a second pressure point: valuation. Dauman said evergreen funds can create flattering early optics if managers buy assets at a discount and then mark them at NAV. “Some fund managers can have some assets entering at a big discount to a NAV and just showing a higher performance from day one,” he said.
This matters because newer evergreen vehicles often rely on short track records during fundraising. Strong early performance can help attract money, even when the economics look less impressive under closer scrutiny. Luxembourg supervisor CSSF recently told evergreen managers to be more cautious in the way they calculate and support NAV. Dauman said CSSF did this “for good reason”.
Luxembourg needs an LP community
He also used the discussion to make a broader point about Luxembourg. The grand duchy remains a strong private markets hub, he said, because it combines regulation, administration and specialist service providers in a single market. Yet one gap remains. “What is missing in my view for Luxembourg is probably to have more LPs locally,” he said.
That critique has circulated for years. Luxembourg is strong as a structuring and servicing centre, yet still thinner as a local pool of long-term capital. Dauman said the number of family offices and investor families on the ground has grown, though the ecosystem still needs stronger organization. “I think it’s about building a community of like-minded investors,” he said.