Private Markets in Focus: Transparency, Valuation, and Retirement

In this episode of The SIFMA Podcast, SIFMA COO Joe Seidel is joined by Lindsey Keljo, Head of SIFMA AMG, and Lisa Bleier, Head of Wealth Management, Retirement, and State Government Relations, to recap key takeaways from the recent Private Markets Valuation Roundtable, including:

• Why private and public markets work best together
• How valuation practices are evolving
• What private markets could mean for retirement savers
• The importance of transparency and investor trust

Also available: replays and reflections with speakers including SEC Commissioner Mark Uyeda, SIFMA President and CEO Kenneth E. Bentsen, Jr., and leading academics and executives from across asset and wealth management.

Segment 1: A Recap of the Private Markets Valuation Roundtable

Segment 2: Remarks from SEC Commissioner Mark T. Uyeda

Segment 3: Valuation Principles and Existing Valuation Guardrails in the Private Markets

Segment 4: Valuation Practices for Private Market Investments in Retirement Accounts

Transcript

Edited for clarity

Joe Seidel: Hello, and thank you for joining us for this episode of the SIFMA Podcast. I am Joe Seidel, Chief Operating Officer of SIFMA and your host today. Today, I'm joined by Lindsey Keljo, Head of the Asset Management Group of SIFMA, and Lisa Bleier, Head of Wealth Management, Retirement, and State Government Relations at SIFMA, to discuss key takeaways from SIFMA's recent Private Markets Valuation Roundtable, held on September 4th in Washington, D.C.

Lindsey Keljo: We had an incredible group of industry leaders, academics, and regulators come together to talk about one of the most important issues in finance right now: valuing private markets, especially when it comes to retirement plans.

Lisa Bleier: And we're excited to share some of the best insights from the day, with clips from SEC Commissioner Mark Uyeda, leading academics, and senior executives across the asset management industry.

Seidel: Let's start with Commissioner Mark Uyeda, who opened the event. He reminded us that private and public markets aren't rivals; they actually reinforce each other.

Mark T. Uyeda: "Economic growth and the capital markets is not a zero-sum game. Public markets benefit from vibrant private capital markets and vice versa. Private markets operate in an environment with more regulatory flexibility and freedom to contract, while public markets provide market participants with enhanced liquidity and access to retail capital that is unavailable elsewhere."

Keljo: That framing really stuck with me. He also pointed out that private markets offer flexibility, while public markets bring liquidity and broad access. Together, they help the system thrive.

Bleier: And importantly, Commissioner Uyeda connected this back to retirement savers. He talked about the importance of considering some level of exposure to alternative investments where appropriate.

Mark T. Uyeda: "While there may be disagreement over the specific amount of exposure to alternative investments, it is clear that retail investors should be permitted to have some level of exposure to such investments. The appropriate answer, which is the one that was set forth in the last, in the prior administration, was that the appropriate answer was zero. I don't think that the data suggests that that amount of exposure is appropriate."

Seidel: That's a powerful takeaway. It's not about replacing public markets - it's about complementing them.

Keljo: Of course, the big question is: how do you actually value these assets? Private companies don't have stock tickers flashing daily prices. So how do professionals get it right?

Bleier: Let's hear from Brian Garfield of Lincoln International on that point.

Brian Garfield: "For a private equity position, there will be different judgments that may be put into place, but there is a common principle that [the industry] thinks through and addresses in context of the subjective and objective inputs that we assess."

Seidel: And then there was Craig Lewis from Vanderbilt, who pushed back against the idea that private valuation is guesswork.

Craig Lewis: "I think some people have said private valuation is like throwing darts at a dart board. I don't think that could be further from the truth. The same principles that one would use to value a private investment are the same that you would use to value a publicly traded company. There is no difference in the techniques."

Keljo: That was one of my favorite moments. He makes it clear: the same valuation principles apply across public and private markets; the difference is in the amount of information available.

Seidel: Sara Shean reiterated this point, explaining that the industry has a strong track record of valuation on the real estate market, which can be leveraged for private asset valuation practices.

Sara Shean: "We've been doing this for a long time in the DC space, on the real estate side of the business. And many of these principles, while every asset class has its own nuances and differences, we can leverage a lot of these practices, and we're not starting from ground zero here. There's a lot of track record established around daily valuation, getting to that point, and how you do that most efficiently with the right partners."

Bleier: And it's not just about methodology. Governance and oversight matter too. Let's listen to Robert Rosen from Carlyle.

Robert Rosen: "From there we have additional committees, we have a valuation subcommittee that would review every valuation. We have a global valuation committee that then reviews every valuation and we have sign off from all of the segment heads within the business to certify the valuations. So for us, checks and balances are not just about the process, they're about protecting the confidence that our investors have within our valuations."

Seidel: Layers of checks and balances-from committees to independent third-party reviews-are all designed to build confidence in the process.

Keljo: I like how Curt Ruoff from BlackRock framed it. Independence and transparency aren't just regulatory requirements - they're expectations from investors.

Curt Ruoff: "These are practices that have been developed over decades in both public and private funds, and that independence is crucial and expected by investors."

Bleier: One of the most compelling conversations was around retirement plans. How can private markets responsibly fit into 401(k)s and other defined contribution accounts?

Seidel: Dan Doonan of the National Institute on Retirement Security put it into perspective by looking at public pensions.

Dan Doonan: "You go back to 2001, public plans were about 90% stocks and bonds, public investments, and today, that's shifted to about 70%. So this isn't that they moved away from one or abandoned any source of investments, but there was a shift. In our research, what we found is this shift has been positive in terms of returns and reduced volatility. Especially since 2012, rolling returns in public pension funds have exceeded 60-40 and 70-30, sort of vanilla portfolios."

Keljo: And Dr. Burcu Esmer of Wharton reminded us why retirement savers are such a natural fit for these investments.

Dr. Burcu Esmer of Wharton: "Retirement savers are great candidates to invest in private markets because private markets like relying on long-term capital and long-term investments, and retirement savers, they are, by definition, long-term investors, of course, I'm not talking about someone who's 80 or 85 years old, but especially, early in your career you have a long horizon to invest, so you can enjoy the illiquidity premium, which is the additional reward one might expect to get for committing the capital or a longer period of time."

Keljo: And internationally, we see examples where defined contribution systems already do this well. Sara Shean from PGIM had a great point.

Sara Shean: "When you go outside of the U.S. and you talk to these investors, they don't think about private equity and public equity. They think about equity and one component is public and one is private, and they think about real estate, and one component is public, and one component is private. So I think, you know, to the extent we are evolving and learning lessons from these other DC markets around the world, we're going to see more of that here."

Seidel: With all of this, investor education and transparency are essential. As retail access grows, building trust is key.

Keljo: True Joe, and our panelists all agreed that transparency, fiduciary safeguards, and investor education will be critical as retail access expands.

Seidel: So what did we learn?

Keljo: That private markets can bring important benefits to retirement savers, but only if valuations are transparent, governance is strong, and fiduciary responsibilities remain front and center.

Bleier: And that's exactly why these conversations matter. If we get this right, we can expand access to new opportunities while protecting investors.

Seidel: Well, thank you, Lindsey and Lisa. For those who are interested in learning more, a replay of the Roundtable is available on our website, https://www.sifma.org, under the events page.

Keljo: And stay tuned for our next session in November, where we'll tackle liquidity in private markets.

Seidel: That wraps up our discussion for today. Thank you all for joining us today, and thank you all for listening in.

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Related Resource

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  Private Markets Roundtable Series: Valuation Practices

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