PE’s $243B Travel Insurance Bet, Immersive Tech for Construction, and Adia’s $1B Qlik Play

Happy hump day !

This week we dive into the Travel insurance market as PE’s next big bet, if the low adoption rate is cracked.

U.S. productivity is surging, setting the stage for a bullish economic decade fueled by AI and innovation.

Interval funds are gaining traction, but private equity allocations remind us why patience pays in illiquid markets.

Adia’s $1 billion stake in Qlik signals Gulf sovereign wealth funds’ growing dominance in private equity.

— Gaston Brizuela & Santiago Morazzani Senior Private Equity Analysts

In this Issue:

• Data Dive

• Trend of the Week

• Liquidity Corner

• Deal of the Week

• Macroeconomics Corner

• Inspirational History

• Interesting Articles

• Tweet of the Week

📚 Data Dive

Private Equity’s $243 Billion Question in the Travel Insurance Space

The travel insurance market, projected to grow from $42 billion in 2024 to $123 billion by 2034, offers a lucrative playground for private equity sponsors. The catalyst? A penetration rate currently at 30%, with a modest annual growth of just 1%. If adoption rates accelerate, the market could balloon to a staggering $243 billion in untapped potential by 2034​.

Key drivers include a rebound in global travel (expected to reach 1.49 billion travelers by 2035), rising disposable incomes, and increasing consumer awareness around travel risks. Growth capital and innovative strategies to improve penetration are critical for unlocking this opportunity. For PE sponsors, it’s not just about funding; it’s about building scalable infrastructure and dynamic go-to-market plans. Those who hesitate risk ceding the space to faster-moving competitors—both insurers and Insurtech disruptors.

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📈 Trend of the week

Immersive Technology: Building the Future of Construction

The construction industry is undergoing a digital transformation, with immersive technologies like virtual reality (VR) and augmented reality (AR) leading the charge. These tools enable architects and engineers to create detailed digital twins of structures, allowing for virtual prototyping and experimentation. This approach enhances accuracy, reduces errors, and optimizes project delivery. Moreover, immersive technologies facilitate remote collaboration, bringing together professionals from around the globe in a shared virtual space. This not only streamlines the design and construction process but also contributes to sustainability by minimizing the need for physical resources and reducing waste. As these technologies continue to evolve, they are set to revolutionize the built environment, making construction more efficient, cost-effective, and environmentally friendly.

Regions of innovation.

Countries with the most business and academic grant funding in immersive technology for the built world from 2021-2023:

• United States: $21.2B

• China: $2B

• Canada: $838M

• United Kingdom: $604M

• Kenya: $506M

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💰Liquidity Corner

Interval Funds – Unexploited Liquidity alternative? 

The latest data on interval funds reveals that Credit dominates the market, accounting for a substantial 62.9% of total net assets. This concentration highlights the current appetite for credit instruments, likely due to their steady yield and resilience in an uncertain economic climate. Real Estate follows with 19.9%, attracting investors seeking inflation hedges and income-generating assets. Equity sits at 9.7%, indicating cautious interest in growth-focused assets within these funds, which still prioritize periodic liquidity.

In terms of returns, the Private Equity/Venture Capital (PE/VC) category, while making up just 3% of net assets, continues to stand out with robust annualized returns (8.23% 5-year avg annualized returns) compared to other categories. This higher performance aligns with the typically high return potential of private equity and venture investments, which appeal to investors willing to accept less liquidity.

However, the trade-off for higher returns is reflected in the limited allocation within interval funds, as these investments carry inherent liquidity constraints that challenge periodic redemption requirements. For investors, the PE/VC category offers a compelling option within interval funds but requires a careful balance between maximizing returns and managing liquidity needs.

🤝 Deal of the Week

$1B for Qlik: Adia’s Latest Power Play in Private Equity

Adia, with nearly $1 trillion in assets, is acquiring a $1 billion stake in data powerhouse Qlik, boosting the software firm’s valuation to $10 billion. Qlik’s analytics subscriptions are flying high (30% YoY growth), and 2024 revenue projections hit $1.5 billion.

This transaction underscores the Gulf’s growing dominance in private equity, as Adia and Mubadala become prime backers amid PE’s slowdown. Thoma Bravo, which bought Qlik in 2016 for $3 billion, joins a growing list of firms leveraging Gulf capital to lock in gains. It’s a clear signal: sovereign funds call the shots in today's buyout landscape.

📊 Macroeconomics Corner

Productivity—the Unsung Hero of a Bullish U.S. Economy

Forget the political noise; productivity is the metric driving bullish economic projections for the United States. Since late 2019, U.S. labor productivity has grown at an annualized rate of 1.7%, a notable acceleration compared to its pre-pandemic pace of 1.3% and leagues ahead of the Euro area’s paltry 0.2%​

This momentum underpins projections like Ed Yardeni’s “Roaring 2020s” scenario, which ties deregulation, tax cuts, and AI-driven efficiency gains to sustained GDP growth. Goldman Sachs echoes optimism, forecasting a 0.4 percentage-point productivity boost from AI by the late 2020s. If realized, this could bring productivity growth closer to its historical 2% average—a game-changer for revenue, earnings, and debt sustainability.

The catch? Policymakers can’t rest on this potential alone. A recalibration of tax and spending policies is essential to foster innovation. AI may provide the spark, but smart policy is the kindling that ensures the fire spreads.

🏆 This Week in History

Uber’s Security Breach: The $100K Blunder

In a plot straight out of a spy thriller, hackers breached Uber’s systems in 2016, nabbing the personal data of 57 million users. The twist? Uber paid them $100,000 to delete the data and keep quiet. But secrets rarely stay buried, and CEO Dara Khosrowshahi eventually spilled the beans in 2017.

California law requires disclosure of such breaches, making Uber’s silence not just bad ethics, but bad strategy. The fallout included lawsuits, regulatory scrutiny, and a battered reputation.

The irony? The breach exposed how Uber’s true vulnerability wasn’t its servers—it was its approach to crisis management.

📰 Interesting Articles

🐣 Tweet of the week

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