In recent years, business development companies (BDCs) have emerged as a powerful tool for retail investors to gain exposure to private credit and private equity strategies—asset classes traditionally reserved for institutional investors.
These vehicles offer a unique opportunity to participate in the growth of middle-market companies while benefiting from the income-generating potential of private credit.
Explosive Growth and Key Drivers in the BDC Market
The BDC landscape has experienced explosive growth, with assets under management (AUM) rising from approximately $127 billion in 2020 to $451 billion in 2025, reflecting a compounded annual growth rate of more than 28%.
This expansion is driven by several key trends:
- Retail investor demand: Retail interest in BDCs has surged, particularly among investors seeking yield, diversification, and access to private credit strategies.
- Regulatory tailwinds: The SEC’s exemptive relief in March 2025 that allowed private BDCs to offer multiple share classes has significantly broadened their appeal and accessibility.
- Shift toward private credit: Direct lending remains dominant, but there’s growing momentum in opportunistic credit and specialty finance, with over 50% of new fund launches targeting these areas.
- Global expansion: Private credit is expanding globally, with new use cases emerging in sectors like residential mortgage lending, aviation finance, and data centers.
Why SEC Multi-Share Class Relief Is a Game Changer
In April 2025, the SEC granted multi-share-class relief that allows private BDCs to offer multiple share classes with differentiated distribution and servicing fees. These share classes can now be tailored to specific distribution channels, including:
- Registered investment advisers (RIAs)
- Broker-dealers
- Institutional investors
This flexibility opens the door for broader distribution and improved alignment with investor needs across various platforms.
Your Partner in Private BDC Distribution
ACA Foreside is uniquely positioned to support the launch and distribution of privately placed BDCs as a placement agent. Our role is to facilitate the necessary dealer agreements on behalf of our clients, an essential step in making these funds available on wirehouses and other distribution platforms.
By leveraging our broker-dealer infrastructure, clients can streamline the onboarding process and ensure their funds are accessible to a wider investor base. Please reach out to learn more about how ACA can support you with:
- Selling agreement facilitation
- Marketing material review
- Registered rep licensing services
- Fund CCO services