The growth of alternative asset classes has been exponential; in 2008 3500 institutional investors were active in the classes, by 2019 this has ballooned to 11,000.

According to data from alternative asset information provider Preqin, while this interest was originally in developed markets, more recently it has spread to emerging markets. Indeed, Fundeye spoke to Harbourvest Global Private Equity last week who said that Asia is booming for that asset class.

However, Preqin shows that there is a lot of interest in Latin America, with Mexico standing out as one major recipient of funding. Preqin said “Currently, there are 50 private capital funds in market that are targeting Mexico for investment, 15 of which are being raised by international managers with no presence in the country. Among these funds, venture capital is by far the most common strategy, with 30 such funds currently raising, seeking just under $6.5 billion in aggregate.”

It is not only Mexico enjoying an uptick in private capital investor sentiment, there are reportedly 103 private capital funds with a primary focus on LatAm. Preqin said that these funds represent $17 billion in capital, led by 20 infrastructure funds and 24 private equity funds seeking to raise an aggregate $6.2 billion and $4.0 billion respectively.

The firm added that 9 percent of private equity firms currently investing in LatAm aim to increase their allocations in the next five years. Preqin also said there is an even greater percentage of surveyed investors that, while not currently investing in LatAm, are looking to do so: 20 percent of such investors are considering LatAm investments.

As 46 percent of surveyed fund managers across alternatives expect emerging markets to present the best opportunities in 2023, the appetite for LatAm investments looks poised to grow in the coming years.