Stay the course: Blackstone’s Joan Solotar on compounding in private markets

This interview was recorded on the 4th of March 2026

I recently bumped into a financial adviser at the airport who was travelling home after several days of back-to-back client meetings. 

Markets were already fragile following the recent technology sell-off, and escalating geopolitical tensions between the US and Iran had only added to the uncertainty.

My first question was simple: How are your clients feeling, and what are they asking you?

She told me many investors were anxious about the headlines. Communication during these moments, when emotions are running hot, is the single most important part of her role.

Volatility is the price investors pay for the daily liquidity available in public markets. History shows that most of the time equity markets grind steadily higher, it’s a comfortable and rewarding ride. 

But as we are experiencing right now, that journey is punctuated by bouts of volatility that can put investors on edge and increase the risk of making impulsive decisions that can ultimately harm long-term returns.

Underlying this conversation is one of the foundational principles of investing, compounding. Returns from investing are rarely linear. To harness the power of compounding, investors should consider staying the course.

That’s a view shared by Blackstone's Global Head of Private Wealth, Joan Solotar, who I had the chance to interview during a recent trip to Sydney. 

Solotar helped take Blackstone public and has spent the past decade and a half building the firm’s private wealth business into a global operation, with more than US$300 billion in assets under management from the private wealth channel globally across Blackstone funds.

She says the same principles that make the case for investing in public markets also apply to private markets, with one important difference, the ability to impulsively trade in and out isn’t there.

“I think the most important point is there’s no power in the world greater than the power of compounding. If you can generate a 12% net return for 10 years, you more than triple your money. So it’s essential to understand that these are not like cash machines at the bank. They’re not trading vehicles where you’re trying to find the next trade."

Advisers in Australia have already begun allocating a portion of client portfolios to private markets, but adoption remains uneven. 

In the United States, Solotar says private market allocations of around 15% are common for investors with more than US$5 million to invest. Outside the US, those figures fall closer to 1% of portfolios.

Institutional investors and family offices have been investing in private markets for decades, often allocating more than 35% of their portfolios. While growth and income opportunities exist in both public and private markets, Solotar argues the benefits of private markets lie in diversification and the potential for more durable returns.

For advisers and investors, a key question often comes down to liquidity. Institutions operate with very different time horizons compared to individuals. Locking capital away for a decade may be manageable for a pension fund, but it can be more challenging for private investors whose financial needs evolve over time.

Bringing institutional capabilities to private wealth clients

Blackstone’s strategy has been to bring the same investment capabilities traditionally reserved for institutions to the private wealth market.

The firm is one of the largest investors in private markets globally, spanning private equity, real estate, private credit and infrastructure. For Solotar, the opportunity was clear, if individuals could access the same capabilities that large pension funds rely on, the benefits could be significant.

“We are the largest commercial real estate investors in the world. We have the largest private equity platform in the world. We have the largest private credit fund, one of the largest infrastructure investors. If you can bring that institutional quality to an individual, that’s win-win.”

The underlying investment objectives remain the same. Private credit can provide attractive income streams. Real estate and infrastructure can offer long-term appreciation. Private equity has historically delivered the strongest return potential, but with longer investment horizons.

Importantly, these investments can play different roles in a portfolio. Private equity may sit alongside equities, while real assets such as infrastructure can provide diversification and resilience. Private credit, meanwhile, often replaces part of a traditional fixed-income allocation.

Historically, access to these investments was limited by the structure of private markets funds. Traditional closed-end funds typically required investors to commit capital for 10 years or more, with very little flexibility.

Over the past decade, that has started to change.

“When we first started, the options that we had were what are more traditional closed end funds. And what that means is you commit to a 10-year fund, your capital gets invested usually over four years… and then the money comes back.”

Those structures worked well for institutions but were less suited to individual investors. As a result, Blackstone developed new fund structures designed specifically for the private wealth market.

“And then we developed open-ended structures, first in real estate, then credit, then private equity, and then infrastructure,” she explains. “And those have either monthly or quarterly liquidity, subject to limits.”

These newer structures still require investors to think long term, but they provide more flexibility and access than traditional private equity funds.

Alongside product innovation, education has become a central part of Blackstone’s strategy.

For many financial advisers, private markets are still relatively new territory. Understanding how the asset classes work, how they can fit into portfolios and how the underlying structures operate is just as important as identifying the next investment opportunity.

Solotar says much of Blackstone’s effort has gone into helping advisers build that knowledge.

“What we really talk to them about is we share our intellectual capital that we gather from our properties and companies and credit so that they’re smarter about what’s happening in the world,” she says.

“We spend a fair amount of time on portfolio construction, how they can use these to build their business and what the benefits are, what the risks are.”

That educational focus has helped drive adoption in the US market over the past decade. While Australia is earlier in that journey, the same forces are beginning to play out.

For advisers guiding clients through volatile markets, the appeal is straightforward, access to a broader opportunity set, the potential for stronger long-term returns, and investments designed to be held through the cycles that inevitably test investor conviction.

Because ultimately, as Solotar puts it, the goal is not to chase the next trade.

It’s to stay invested long enough for compounding to do the heavy lifting.

Learn more

For more insights from the team at Blackstone, please visit their website. 

The information in this material is general information only and is intended solely for licensed financial advisers or authorised representatives of licensed financial advisers and wholesale client investors. It is not intended to constitute financial product advice or an offer, invitation, solicitation or recommendation to invest. This information must not be distributed, delivered, disclosed or otherwise disseminated to any investor. It has been prepared without taking into account any person’s investment objectives, financial situation or needs. Investors should consider whether the information is suitable to their circumstances.