Private equity has officially gone mainstream.

What was once reserved primarily for institutions and ultra-high-net-worth investors is now increasingly showing up in broader client portfolios through evergreen funds, interval funds, and alternative investment platforms. Advisors are being asked more frequently about private market exposure—and many are responding by allocating more client capital into the space.

But there’s a growing problem underneath the enthusiasm:

Many advisors still struggle to clearly evaluate and explain private equity performance.

And in an industry built on trust, that’s becoming a serious issue.

The Transparency Problem in Private Equity

Unlike public markets, where benchmarks and performance comparisons are relatively standardized, private equity operates in a much murkier environment.

Performance numbers often vary widely depending on the benchmark being used, how returns are calculated, and what data is included. For advisors trying to explain outcomes, risks, and portfolio value to clients, that creates a difficult situation.

Clients don’t simply want to hear that private equity “typically outperforms.” They want to understand:

• What they own
• How it’s performing
• Why it’s performing that way
• Whether the added complexity and illiquidity are worth it

When advisors can’t answer those questions clearly, confidence erodes.

And increasingly, firms are recognizing that this is not just a communication challenge—it’s a fiduciary one.

Not All Private Equity Benchmarks Are Created Equal

One of the biggest misconceptions in private markets is that all benchmarks measure performance the same way.

They don’t.

Some benchmarks rely on aggregated fund-level reporting, while others analyze the actual performance of the underlying companies within those funds. That distinction matters far more than many advisors realize.

Fund-level benchmarks can provide a broad overview, but they often offer limited visibility into what is actually driving returns. Advisors may know how a fund performed overall, but not whether performance came from strong underlying businesses, favorable timing, sector concentration, or broader market conditions.

That lack of transparency becomes problematic when clients start asking deeper questions.

Investment-level benchmarks, on the other hand, provide more detailed insight into how sectors, industries, or specific investments contribute to results. They allow advisors to evaluate private equity exposure in a way that more closely resembles public market analysis.

In other words, they make private market performance easier to explain—and easier to defend.

Evergreen Funds Are Changing the Conversation

Another issue emerging in wealth management is the mismatch between traditional private equity benchmarks and newer investment structures.

Many advisors today access private equity through evergreen funds rather than traditional closed-end funds. Unlike closed-end structures, evergreen vehicles continuously reinvest capital and allow for periodic liquidity.

That flexibility has helped bring private markets to a broader range of investors.

However, many of the traditional benchmarks advisors rely on were never designed for these types of vehicles.

As a result, advisors may end up comparing investments against benchmarks that don’t fully reflect how the product actually operates. That creates confusion for both advisors and clients.

The firms ahead of this trend are becoming far more deliberate about ensuring that the benchmark methodology aligns with the structure of the investment itself.

Because when comparisons aren’t truly apples-to-apples, performance discussions quickly become harder to navigate.

Clients Want Simpler Explanations, Not More Complexity

One of the most overlooked realities in wealth management is this:

Clients are not asking for more sophisticated jargon around private equity. They are asking for clarity.

They want to understand how private investments compare to the public market alternatives they already know. If a client can easily track the performance of public healthcare stocks, they naturally want to know how their private healthcare investments compare—and whether the additional risk and illiquidity are justified.

This is where many advisors struggle.

Private equity has historically benefited from opacity. But as the asset class becomes more accessible to everyday investors, that opacity is becoming less acceptable.

Advisors who can clearly explain performance drivers, benchmark methodology, and long-term portfolio value will stand apart.

Those who can’t may find themselves losing credibility with increasingly informed clients.

What This Means for Hiring in Wealth Management

As private markets continue expanding into retail and high-net-worth portfolios, firms are becoming more selective about the advisors they hire.

Technical product knowledge alone is no longer enough.

Firms increasingly want advisors who can:

• Explain complex alternative investments clearly
• Navigate nuanced portfolio discussions
• Build client trust around illiquid investments
• Understand benchmarking and performance evaluation
• Translate technical data into practical guidance

That skillset is becoming more valuable as private market exposure grows.

The advisors who thrive in this environment will not be the ones who know the most jargon. They’ll be the ones who can simplify complexity without oversimplifying risk.