More than a decade ago, I wrote a story called "Is Alpha Dead?" The premise was simple: Markets had become so competitive, so efficient, and so crowded that generating excess returns was getting harder and harder.

Andre Perold, CIO of HighVista Strategies, was one of the people I interviewed for that piece.

So I was curious how he thinks about the question today.

Perold argues that we're living through a period of such rapid technological and economic change that opportunities for alpha may actually be expanding. In a world shaped by artificial intelligence, breakthroughs in healthcare, and shifting business models, markets don't always adapt as quickly as investors assume.

As Perold says, “the ability to get an edge is much greater when new things are happening, for better or worse. You can see things, understand things, and react more easily in this new world.”

That doesn't mean alpha is easy to find. Perold has always believed investors need to look in what he calls "beautifully inefficient" markets, smaller corners of the investing world where size, specialization, and human behavior still create opportunities. That may be more important than ever.

We talked about biotech, small buyouts, risk, the real definition of a mistake, diversification, and why some of the most interesting investors are what he calls "small geniuses" operating far from Wall Street's spotlight until great performance attracts more capital and the search for the next small genius begins again.

We also discussed a topic that feels particularly relevant today: why networks (of people) still matter. At a time when we’re swimming in information and AI-generated stories about that information, Perold believes the edge comes from long relationships with people whose judgment you trust, and who help you see opportunities and risks that aren't obvious from the data and endless crunching of it. And data won't introduce you to that next great investor. Take a walk and listen to my conversation with Andre.

In this episode, I spoke with Stuart Fiertz, co-founder and president of Cheyne Capital.

I've known Stuart for years and one of the things I appreciate most about him is his willingness to say things that many people in the industry are thinking but few will say publicly. This conversation was a good example.

We started with private credit, because, well, there’s a lot to say. Stuart argued that many of the concerns he and other investors have raised over the years are beginning to surface. He discusses the rise of payment-in-kind loans, concentration in software and technology, and why he believes the industry still hasn't fully absorbed the consequences of the dramatic interest-rate shift that began in 2020.

As Stuart put it: "You just can't have such a momentous change in an interest-rate regime and not have fallout from that."

But he doesn't expect a dramatic collapse. In fact, the industry has become remarkably good, perhaps too good, at delaying any reckoning. Loose covenants, refinancing activity, continuation vehicles, evergreen capital, and fresh sources of funding are all helping extend the credit cycle. The problems are showing up, Stuart argues, but they're unfolding far more slowly than many expected.

We also discussed what may ultimately unlock the industry's enormous backlog of unsold private companies. Stuart has been thinking about this question for a while. When he entered the business, private equity often created significant value by taking public companies private and improving them. Today, many businesses have been passed from one sponsor to another through multiple ownership cycles.
Stuart’s question is a simple one: "Who is leaving value on the table?" he asked.

His point was not simply that valuations remain too high. “I think there's a little bit of a challenge here that is more fundamental than I think people realize. It's part that the lemon's been squeezed. I think it's going to take a meaningful valuation haircut to move them. And I'm just not sure why the PE firms would mark them down.”

We also get into why Stuart believes transparency may be the industry's biggest challenge. He argues that investors, regulators, and managers would all benefit from more consistent reporting and warns that private credit firms risk inviting heavy-handed regulation if they don't become more forthcoming about what is happening inside portfolios.

And there’s more. Listen in for other topics and tidbits we covered:
• The difference between "cockroaches" and "termites" when assessing risk in credit markets
• Why semi-liquid credit funds may increase cyclicality and pressure managers to deploy capital
• Whether the industry's push into retail was driven more by asset gathering than investor need and why it matters
• What continuation funds reveal about today's private equity exit environment
• Why Europe remains both attractive and frustrating for private market investors

In this episode, I speak with Luke Sarsfield of Ridgepost Capital about what’s actually changing in private markets — and what isn’t.

At the center of our conversation is a tension that’s easy to miss: investors in private markets aren’t just dealing with slower distributions or questions about liquidity. They’re adjusting to a broader mix of investors that are participating, but don’t behave the same way when markets turn.

We also discuss:
• How institutional investors are thinking about the flow of capital — with distributions taking longer and recycling becoming less predictable
• What the last real stress test for private markets during the financial crisis taught investors — and what’s different this time
• Why more than 80 percent of capital gets invested in 10 to 15 percent of private companies and what it says that the top financial firms “climb over each other” to finance and invest in them.
• How investors should think about putting money to work during dislocations, a fundamental tenet of investing — and why some are leaning in while others hesitate
• What risks may be building outside of private credit that investors seem to be ignoring