Modern Capital: The Private Markets Podcast

When it comes to data, private credit is where private equity was 15 years ago.

After months of pressure on the asset class, LPs want more transparency. But credit managers don't have great tools to deliver it. Excel is still the default.

By Charlie Tafoya's count, portfolio monitoring software has about 3% penetration in private credit, against roughly 40% among private equity GPs.

Private equity went through this transformation after 2008. Charlie saw it from Pantheon, investing in secondaries when the whole market was $8 billion. It's about $170 billion today.

LPs started asking for performance figures and valuation methodologies on a more regular basis. That demand helped the secondaries market grow. The technology to handle it didn't keep up. So Charlie, a self-described computer nerd, saw a way to bring all that data together.

“I was up for VP at Pantheon, so I definitely had the private equity career track laid out right before me. But yeah, I ultimately quit on a Friday, actually got married on Saturday and then started coding literally on Monday. So my father-in-law didn't know that I had left my private equity job at the altar.”

Ten years ago, Charlie co-founded Chronograph, which provides data management, valuations and analytics technology for institutional private capital investors. Eight of the 10 largest GPs now use its software, as do five of the 10 largest LPs.

Seventeen years on Wall Street taught him that the whole system is built on trust. In a regulated, audited industry, he argues, that means a system of record has to show who can change a value and how it's changed over time.

In this episode of the Modern Capital Podcast, Charlie and Marc cover:

• Raising $143 million at peak SaaSpocalypse fear, and why he asks his team to be 8% less comfortable
• Why there's no objectively right way to classify pre-IPO Uber, and why that's healthy
• Why the founder of a data company argues against industry reporting standards
• Who counts as a pure-play LP anymore, and what that does to the line between LP and GP software
• Why an RIA may not be equipped to pick managers, and what has to exist first
• Whether private credit resembles 2008, and the test Charlie applies whenever markets come under stress

Private credit now faces the data demands private equity faced after 2008. Charlie has watched this movie before.

Asset-based finance started with credit cards, auto loans and trade finance. It now covers 70 to 80 kinds of collateral, with music rights and cell towers among them. Every party in a deal runs its own system, and those systems were not built to talk to each other.

In a receivables facility, the originator reports what's in the pool, monthly or weekly, in a spreadsheet. Someone at the lender checks it against the invoice PDFs and the bank statement, by hand. On a $50 to $60 million line, that can mean 1,500 new receivables each week.

Altin Kadareja spent his BlackRock years valuing the loan pools European banks were selling after the financial crisis, all of it on spreadsheets.

Eight years ago, he left to build the software he could not buy. Cardo AI connects the originator, the lender and the bank, so every party reads the same numbers. Today, it runs inside some of the biggest names in private credit.

In this episode of the Modern Capital Podcast, Altin and Marc cover:

• Why only 30% of the $40 trillion ABF market is new collateral, and where the real innovation sits
• Why banks underwrite on compliance and asset managers underwrite on return, and what that does to the loss curve
• Two months at a bank against 20 days with an asset manager: why borrowers pay a premium for private credit
• GPU financing, data centers and robotics: collateral the standard cash flow engines cannot model yet
• Why a chatbot is 2% of what AI can do for an asset manager, and what has to come first

“I want to create a technology highway, which is software, data and AI, that everyone could work better in a standardized way, and could make the market scale faster.”

Altin thinks the market cannot scale faster until every party reads the same numbers. The spreadsheet is what stops them. This is a conversation on how to fix it.

The most opaque asset in private capital is a relationship.

Every investment starts with a path to a CEO or a board. That path lives in one partner's head, inbox and calendar.

Ken Fine spent five years designing propulsion systems for nuclear submarines, where a single error could sink a boat with the crew still aboard. Then more than a decade at Financial Engines, turning Bill Sharpe's Nobel-winning models into a product individual savers could use to run their 401(k)s.

Today he runs Affinity, a CRM purpose-built for private capital. His first reaction: "a CRM? Hasn't that been figured out?" Then he saw the data set.

For about a decade, the platform has ingested its customers' emails and calendar appointments, and mapped out the relationships inside firms and across them. Basically who knows whom, how and in what context.

By Ken's count, roughly 40 to 50% of the venture capital market is on it. The map reaches past the firms themselves to the founders, board members and bankers they deal with. Private equity and private credit are now where the platform is growing fastest.

Humans can only know so many people, and we recall fewer when it matters. Firms often end up waiting for a banker to run a process instead of finding the path they already had.

In this episode of the Modern Capital Podcast, Ken and Marc cover:

• What designing nuclear submarines teaches you about ownership, and when software needs the opposite
• What the Financial Engines playbook means for putting private assets into 401(k) plans
• Why the line between a VC firm, a PE firm and a private credit firm is disappearing
• The three layers of what comes after the CRM: raw data capture, compliance, and agents for sourcing, deal qualification, IC prep and portfolio monitoring
• What is left for the human when the agents do the rest
• How Ken uses AI every day, from inbox triage to a thought partner he tells to be cynical

"This space, as much or more than most, is relationship-driven. So if you're in the venture world, and you want to make an investment, you're going to need to find a way to get connected to the CEO, or get connected to board members. So leveraging networks is a critical piece of capital within these firms."

Relationships as infrastructure. Ken is putting that currency on the books.

For years, the credit markets ran on clean lines. A bank loan was one thing. A bond was another. Private credit sat off to the side.

Those lines are gone. Global credit is becoming one integrated market, $145 trillion in scale, and almost none of its infrastructure was built for what it has become.

Steven Hunter and Huss El-Sheikh met at university, shared a London flat and turned a shared frustration into 9fin. The incumbent solution to reading credit documents was 5,000 people retyping them by hand. They taught machines to do it instead. Today, it's a billion-dollar business and the closest thing debt markets have to a central filing system.

In this episode of the Modern Capital Podcast, Steven, Huss and Marc cover:

• Why buyers stopped wanting point solutions (and what they want instead)
• The inverted newsroom: machines publish what companies say, journalists chase what no machine can reach
• Where AI stops in credit and why confidently wrong is the cardinal sin of finance
• Private credit's move from 0% of large private equity deals to a 50-50 split with the syndicated markets, and Steven's ten-year call on where it lands

"The clear, distinct silos between the asset classes within private markets, and in particular debt markets, are completely breaking down. Market participants effectively play across all of them, and they're all very interchangeable."

The walls came down faster than anything got built to replace them. The tooling underneath still assumes they're there.

Private credit grew faster than the infrastructure built to monitor it.

LPs are still reconciling loan agency notices, compliance certificates and financial statements by hand, out of spreadsheets held together by Excel formulas nobody currently employed can explain. The operational risk is real, and for some of the world's most important institutional investors, it's now front and center.

Harald Collet's answer isn't a standard. He's betting that private markets data will never standardize the way public markets did. 

So he built Alkymi to absorb the mess, rather than wait for the industry to clean it up. The clients putting that bet to work are sovereign wealth funds, insurance companies and pension funds - with collectively over $20 trillion in AUM - for whom getting data 45 to 60 days ahead of the CIO is the difference between monitoring risk and discovering it.

In this episode of the Modern Capital Podcast, Harald and Marc cover:

• Why private credit requires hundreds of data points per loan and why that number will never standardize
• What it actually takes to move a monitoring workflow off spreadsheets and into production
• Why every effort at common data formats in private markets hits the same wall
• The Forward Deployed Engineer model for getting firms through the change management they can't staff themselves
• Why Excel isn't going away and why it was never supposed to be the reporting platform

"These were young hopeful professionals that were sold on the dream of joining a glamorous firm, and they were essentially processing PDFs in the shared email inboxes for the first 18 months of their time at the firm... And we thought, this is a terrible way to work."

Private credit needs real data infrastructure. The asset class is only growing and the mess is only getting bigger. The firms still waiting for a standard are running out of time.

Fund administration was born in a world where a GP's entire LP base could fit in a small conference room. That world is gone. 

Now it's being asked to handle 500,000 investors. The subscription docs, data workflows and staffing models were never built for this. Neither was the technology underneath them.

Joan Kehoe watched this transition happen once before. In 2006, hedge funds were running on infrastructure built for a different era, with quarterly cadences, manual processes and legacy platforms too embedded to move. She built the company that fixed it. Data transparency. Daily reporting. The work the large administrators wouldn't touch.

She sold that business, then spent five years rebuilding hedge fund servicing from inside JP Morgan, the hardest five years of her career. Legacy technology plus legacy process plus an organization that size is a different problem than building from scratch.

Then she watched the same pattern begin again in private markets and founded Alchelyst to fix it. The difference this time is pace. The industry has to move faster than it did in 2006 - and for once, the tools exist to do it.

In this episode of the Modern Capital Podcast, Joan and Marc cover:

• Why hedge funds in 2006 are the exact template for private markets now 
• The evergreen problem: why funds built for 50 institutions cannot simply scale to 500,000 investors
• What AI agents actually do to the fund administration staffing equation and what they cannot replace
• How the merger with Lyra Client Solutions (Apollo's spun-out LP servicing team) creates a full-stack from pre-trade through post-trade
• Whether fund administration consolidates to three or four dominant platforms - or stays distributed

"The reason we set up Quintillion was recognizing there was room to do it quicker, smarter, better. And that all resonates with today. But what's really different now is the pace. The pace at which you can effect and have to effect change now is completely different than it was 20 years ago."

Joan built this infrastructure once. The question is how fast it happens this time.

Private markets grew for decades without obsessing over the investor experience. 

A few hundred GP names mattered, and they competed on one number: returns. There was no pressure to care about reporting quality, data timeliness, or what it felt like to be on the receiving end of a quarterly PDF.

That era is over.

Amit Gairola spent a decade at Amazon, where every decision came back to one question: what does this do for the customer? He brought that question to private markets and built Daphne, a permissioned data layer that makes straight-through data processing possible between GPs and the allocators, platforms and fund of funds that invest with them.

Griff Norville is Co-Head of Innovation at Hamilton Lane, one of the largest allocators in private markets with roughly $1 trillion in assets under management and supervision - and both a backer and live user of Daphne. He's watched the industry evolve from one where delivering returns was enough, to one where a new class of investors brings expectations formed by public markets, consumer technology and the Amazon-era assumption that a good experience is simply the baseline.

The problem they're solving is not subtle.

"The uncomfortable truth in this industry — for all the growth we've had and the improvements that we've made — is that we still operate with PDFs and emails and cumbersome data rooms."

In this episode of the Modern Capital Podcast, Amit, Griff, and Marc cover:

• Why private markets built its infrastructure around documents instead of data and why that logic no longer holds
• The difference between data extraction and straight-through processing, and what closing that gap actually requires
• Why standardization keeps failing - and why AI-powered translation may make it irrelevant
• How evergreen funds moving from quarterly to daily valuations are making the current system untenable
• What 401(k) access and secondary market growth require from data infrastructure before either can scale

Private markets has to start treating its investors like customers. Delivering a great LP experience is becoming the new standard, and the infrastructure to make it possible is only now being built.

The mutual fund put investing in the hands of ordinary savers. The ETF made it cheaper, faster and borderless. Both transformed asset management. Both also required infrastructure that didn't exist when the product arrived. 

Private markets are wave three. And the infrastructure problem is bigger this time.

Michael Gruener lived through both of the first two: mutual funds at Goldman in the early 2000s and ETFs at BlackRock through the iShares expansion across Eastern Europe and the Middle East. He knows what a category-defining shift looks like from the inside. And he knows what breaks when the rails are not ready.

Now, as co-CEO of Titanbay, he's building the infrastructure for wave three before it breaks.

In this episode of the Modern Capital Podcast, Michael and Marc cover:

• Why the semi-liquid evergreen fund is the ETF of private markets - and why the infrastructure underneath it is not ready
• The "know your client, know your trade" problem - and why today's trade rails were built to do the opposite
• What an 8% NIGO rate looks like when a model portfolio rebalance triggers 100,000 trades in a single day
• Why the fix is faster than the industry expects - and why it comes down to 24 names
• How Titanbay connects to distributors in whatever format they have, applies private market logic, and hands back a trade in good order
• Where the boundaries between public and private markets are heading - and the one condition that has to be met first

"That trade infrastructure was not built for this product... It was built for the industry as it existed in 1996, when I started at Goldman. Nobody went back and rebuilt it."

Wave three is already in motion. This is a conversation about what it breaks on the way through.

Private markets have solved origination. The products are built. The constraint now is a wealth management tech stack built for mutual funds and ETFs that cannot run semi-liquid products at scale.

Jake Walker is Partner and COO of Client & Product Solutions at Apollo, where the wealth distribution build he has spent five years running has gone from zero to more than $17 billion in annual channel raises. Private markets are joining the $147 trillion world of traditional asset management. The infrastructure needed to carry them hasn't kept pace.

His read: the fix costs $400 to $800 million spread across 50 to 70 endpoints. "Pennies for everybody," he says. But the problem isn't money. It's coordination. Every industry that hit this moment solved it the same way. The wealth management ecosystem never has. 

In this episode of the Modern Capital Podcast, Jake and Marc cover:

• Why the wealth management stack breaks when semi-liquid products arrive at scale
• How omnibus accounts could unlock distribution and what needs to be true for subscription documents to disappear
• Apollo's push for estimated daily value across its entire credit book
• The Netflix parallel: what Reed Hastings had to build before anyone could stream (and what private markets needs to build before it can distribute)
• Whether asset managers become hardware providers or build the coalition that makes it unnecessary

"I want the rail to be ubiquitous... we need it ubiquitous because I think if the market grows, our firms will grow. I will compete on brand, and content, and client service, and investment performance. I will not need to compete on how the infrastructure works."

The money is in motion. The rails aren't ready. And the only path forward is a level of collaboration that this industry has never been forced to attempt before.

The wealth channel buildout everyone in private markets is betting on has a plumbing problem.

Evergreen funds are growing fast. Roughly 300 products, ~$550 billion in AUM and demand from wealth platforms that is real and accelerating. These vehicles are designed to bring private markets within the reach of everyday portfolios, but the infrastructure underneath them was built for institutions writing $50M+ checks, not hundreds of thousands of investors at lower minimums.

The NIGO rate (orders failing on documentation, compliance, or funding before they ever clear) sits at 8%. Every subscription flows bilaterally between advisor, custodian and transfer agent. At the scale this market needs to reach, that system breaks.

Ben Haber is co-founder and CEO of Monark Markets. He started building it as a sophomore at NYU. On graduation day, he skipped the ceremony to close on the assets of a bankrupt fintech instead. That deal crystallized the thesis: private markets don’t need a better interface. They need better rails.

His answer is omnibus: one account per fund per custodian, netting all orders rather than processing each one individually. The structure Schwab built for mutual funds with OneSource, applied to private markets.

In this episode of the Modern Capital Podcast, Ben and Marc cover:

• Why the "Robinhood for alts" D2C wave failed and why competing with Fidelity and Schwab for the same customer was never going to work
• Why evergreen funds cannot sit inside model portfolios without omnibus underneath them
• How the pending paperwork crisis in private markets can be solved by simply removing the paperwork

"One omnibus account per fund, per custodian... dramatically less than the hundreds of thousands or millions of individual accounts the transfer agent would need to record. A real ability to actually scale the evergreen fund market in a way that is simply not possible today."

The wealth channel opportunity is well understood. This conversation is about what has to get built before it gets there.