Key Takeaways
- • Cliffwater, the $33 billion private credit manager co-founded by Stephen Nesbitt, is facing investor redemption requests of roughly 14% at its largest fund this quarter, with the fund paying out only 50% of requests, according to Bloomberg reporting.
- • The redemption pressure is concentrated in a co-investing credit fund led by father-and-son team Stephen and Blake Nesbitt, placing the family's leadership and reputation under a test amid wider private credit outflows.
- • Cliffwater's situation is part of a broader private credit redemption rush that has also affected Blue Owl, BlackRock and Blackstone, signaling sustained strain in semi-liquid private credit vehicles.
- • The episode highlights how quickly liquidity and investor confidence can be tested in a more cautious environment for private markets firms.
Summary
Bloomberg's Going Private newsletter reports that Cliffwater has become one of the most prominent question marks in the private credit sector as investors rush for the exits. The firm, which manages roughly $33 billion, is led by founder and CEO Stephen Nesbitt, who is widely known for his writings on private debt, including the book "Private Debt, Second Edition." According to Bloomberg, investors he helped educate are now seeking redemptions from funds he oversees.
Bloomberg reports that Cliffwater's largest fund will pay out only 50% of investor redemption requests this quarter, which total about 14% of the fund's assets. The shortfall is being framed by commentators as a signal of wider strain in private credit, a segment that has seen elevated withdrawal requests across the industry.
The pressure is particularly acute for the Nesbitt family. Stephen Nesbitt and his son Blake Nesbitt are running a co-investing credit fund that is now at the center of the redemption battle, making it a test of family leadership and governance as much as of portfolio liquidity.
The situation has drawn comparisons to recent stress at Blue Owl, BlackRock and Blackstone, all of which have faced heightened private credit withdrawal activity. Bloomberg notes that the episode underscores how liquidity, confidence and reputation can be tested quickly when conditions turn more cautious for private markets managers.
Bloomberg reports that Cliffwater's largest fund will pay out only 50% of investor redemption requests this quarter, which total about 14% of the fund's assets. The shortfall is being framed by commentators as a signal of wider strain in private credit, a segment that has seen elevated withdrawal requests across the industry.
The pressure is particularly acute for the Nesbitt family. Stephen Nesbitt and his son Blake Nesbitt are running a co-investing credit fund that is now at the center of the redemption battle, making it a test of family leadership and governance as much as of portfolio liquidity.
The situation has drawn comparisons to recent stress at Blue Owl, BlackRock and Blackstone, all of which have faced heightened private credit withdrawal activity. Bloomberg notes that the episode underscores how liquidity, confidence and reputation can be tested quickly when conditions turn more cautious for private markets managers.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.