The continuous monthly inflows of successful evergreen funds create immense pressure to deploy capital quickly. In slow deal markets, this forces a difficult choice: halt inflows and kill momentum, or risk performance dilution from cash drag or investing in lower-quality assets to meet deployment targets.

Recognizing the friction in accessing private markets, Apollo spent $1 billion from its balance sheet on wealth tech. This strategic investment aims to improve the underlying infrastructure for the entire industry, acknowledging that a better ecosystem benefits all participants, not just themselves.

Apollo's foundational private equity strategy—seeking value, being contrarian, and investing flexibly across the capital structure—was not siloed. This single philosophy of maximizing return per unit of risk now guides every investment decision across their entire platform, including credit and insurance.

With half its AUM being its own captive insurance capital, Apollo's mindset shifts from a third-party manager to an owner-investor. This changes the client conversation from "here's a new product" to "here's what we're investing our own money in, join us." This deep alignment builds significant trust with LPs.

A major driver for M&A is the increasing scarcity of growth opportunities. Asset owners and intermediaries are actively consolidating providers, planning to reduce the number of asset managers they work with by up to a third, forcing firms to merge to secure their place and access growth.

The 15 largest PE firms control 20% of industry AUM and have mastered capital aggregation through insurance and wealth channels. Their primary business challenge is now deploying this capital into enough quality deals, while every other firm still struggles to raise funds.

The firm's core belief, "purchase price matters," reframes the concept of "toxic assets." Any asset, no matter how distressed, can become attractive if the price is right. This mindset allows the firm to act decisively during market dislocations when others are fearful, capitalizing on mispriced complexity.

In today's crowded market, the key PE differentiator is no longer financial engineering but the ability to identify and cultivate relationships with target companies months or years before a sale process. This provides the necessary time for deep diligence and strategic planning.

The 2008 financial crisis created opportunities to buy discounted corporate debt, making Apollo realize that providing capital (credit) is fundamentally linked to providing equity in leveraged situations. This insight led them to build their now-massive integrated platform.