Fund managers are not charged placement fees by Revolut for listing their funds; instead, the fintech receives retrocessions tied to the relevant share class, a representative explained, noting that these payments are uniform across all distributors for that share class.
Revolut stated that these funds are intended for investors willing to commit for several years and who do not need quick liquidity.
This collaboration between Revolut and major asset managers, involving a platform with over 75 million users, represents the newest initiative by private capital firms to attract individual investors for fresh funding sources. In February, Bloomberg News disclosed that Revolut had been in preliminary discussions with Apollo regarding such a service.
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This initiative arrives during a volatile time for numerous private market funds, which have experienced a surge of redemption demands recently, primarily from affluent retail clients who previously spurred expansion. Apollo and Ares are two of the several companies that have limited withdrawals. Last month, Partners Group imposed a ceiling on withdrawals from a large evergreen buyout fund due to heightened redemption stress. These developments underscore the importance of careful fund selection and liquidity management, which Revolut's new offering aims to address by partnering only with managers that have demonstrated robust redemption handling.
The company has assembled a nine-person core team responsible for evaluating fund managers' performance histories and their capacity to handle redemption requests. "If a fund manager was not able to show a history that they were able to manage the redemption requirements, that manager was not considered" for the offering, Rolandas Juteika, who leads wealth and trading for Revolut in the European Economic Area, stated in an interview.
In 2023, Trade Republic of Germany collaborated with Apollo and EQT AB; concurrently, Robinhood Markets Inc. introduced a closed-end fund enabling U.S. retail investors to access private company investments.
For a European investor, this is a chance to invest in private markets with a minimum of €1. The trade-off is that the funds are designed for a multiyear horizon - investors who may need immediate access to their capital should consider that carefully. Revolut screens managers on their ability to handle redemption requests.
Revolut's existing services include checking and savings accounts, global money transfers, crypto and stock trading, plus bill-paying and budgeting tools. The company aims for 100 million users in 100 nations and seeks $100 billion in revenue. The wealth division's revenue growth decelerated last year following a sharp uptick in 2024. Fee-based income already accounts for 76% of the firm's sales.
The screening process goes beyond past performance; the nine-person team also analyzes a fund manager's track record across different economic cycles, ensuring that only those with proven liquidity management and transparent redemption policies are included. This rigorous vetting is meant to reduce the risk of investors being caught in a redemption freeze, a concern that has recently hit even well-known private market funds.
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