The New “Private Markets” and the Illusion of Access
This quarter, PitchBook published The New Face of Private Markets in Your 401(k), examining how regulators and asset managers are attempting to “democratize” access to private investments. The phrase sounds progressive and modern: ordinary families gaining entry to the same asset classes that built institutional and generational fortunes. But the closer one reads, the clearer the paradox becomes. The expansion of “private markets” inside the 401(k) system is not a decentralization of power. It is the opposite.
The report shows that what is entering mainstream retirement plans is not private equity or venture capital in any meaningful sense, but semi-liquid vehicles composed of private credit, real estate, and infrastructure debt. These funds are designed primarily to absorb the bi-weekly cash flows of defined contribution plans and to provide the quarterly liquidity regulators require. The result is a new generation of investment products that mimic the optics of private exposure while retaining the systemic characteristics of public markets.
Liquidity, the very feature marketed as empowerment, is what prevents these structures from behaving like true private investments. Because they must accept new money continuously, managers are forced to deploy capital regardless of price or timing. They cannot wait for the right deal or exercise the discretion that defines traditional private investing. The architecture of the product dictates its behavior, not the judgment of the investor. What has been created is a financial instrument that satisfies fiduciary checklists but not necessarily long-term results.
The democratization narrative therefore obscures the deeper reality: the largest asset managers—those best positioned to handle the inflows—are offering products that serve their own liquidity management needs rather than the individual’s long-term wealth objectives. It is not access; it is rebranding. Families remain tethered to Wall Street’s quarterly rhythms, its compliance-driven thinking, and its dependence on market sentiment.
Rethinking Risk
The popular definition of risk centers on volatility. Yet volatility is a temporary fluctuation, not a loss. The real risks faced by families are structural and permanent: erosion through taxes, the cost of liquidity at the wrong time, and the absence of coordinated transfer planning. These are risks that markets cannot price, because they are not measured in basis points but in the continuity of a family’s financial life.
A Foundation Account is not an instrument built to chase growth. Growth, when pursued without structure, becomes speculation. The Foundation Account exists to solve for taxes, liquidity, and generational transfer—the three forces that quietly erode compounding over time. It transforms volatility into optionality and turns savings into capital with purpose.
Where public markets demand constant participation, a Foundation Account rewards stillness. It grows without exposure to market cycles, remains liquid for family needs, and transfers privately under rules you define. It replaces market dependence with design.
Untethering from Wall Street
To untether from Wall Street is not to reject growth or enterprise. It is to recognize that markets are only one layer of a financial system, and not the foundation. The foundation must be built first, then invested upon. The objective is not maximum return but enduring control—the ability to determine timing, taxation, and transfer on your own terms.
The current movement to insert private markets into retirement accounts is framed as progress, yet it extends the same dependency under a new name. The real evolution will come from families who build private structures of their own, not through products, but through architecture—trusts, policies, and instruments that compound quietly across generations.
Growth is desirable, but structure is essential. It is what separates accumulation from stewardship, speculation from permanence. A Foundation Account does not compete with the market; it redefines its place within a larger system of continuity and control.