Global private equity has no shortage of capital. What it increasingly lacks is the operational discipline required to convert that capital into sustainable, long-term value — particularly as Gulf investors take on a more prominent role in shaping global investment dynamics.
Capital is abundant – execution is not!
Global buyout dry powder remains near record highs — estimated at approximately $1.2 trillion. Middle Eastern sovereign wealth funds, family offices and institutional investors are now among the most important sources of that capital, backing transactions in the US, Europe, Asia and across emerging markets.
The Gulf region is undergoing a fundamental economic transformation. National agendas such as Saudi Arabia’s Vision 2030, the UAE’s diversification strategyand Qatar’s knowledge-based economy push are all driving investment into new sectors and ownership models. Dubai and Abu Dhabi are strengthening their positions as wealth hubs, with more than 300 financial firms active in Abu Dhabi Global Market (ADGM) alone and a growing ecosystem of asset managers, private offices and funds.
Yet generating sustainable value is becoming increasingly complex. Signing-to-closing times for private equity deals have lengthened sharply over the past two years. Investors now expect more frequent and detailed reporting. Cross-border deals come with more regulatory, tax and operational complexity than ever. The gap between promised returns and realised outcomes is widening.
Identifying the right assets is no longer sufficient. Increasingly, value creation depends on execution architecture — the systems, structures and governance frameworks that convert capital into tangible results. Based on our work with fund managers and institutional investors across offshore fund jurisdictions, developed private equity markets, and fast-growing economies, we have identified four recurring execution gaps.
Gap 1: Emerging-market ambition, execution reality
Across the Middle East, Africa and Southeast Asia, investment theses remain highly attractive: demographic trends are supportive, digital adoption is accelerating, and governments are actively pursuing infrastructure development and economic reform. Fundraising often reflects this optimism.
A business that looks scalable on paper can quickly run into fragmentation in practice. A regional platform may need different systems to meet Saudi regulatory requirements, UAE corporate and tax frameworks and Egyptian currency controls. Finance functions built for single-market reporting can quickly become overstretched. Talent strategies assuming seamless regional mobility frequently face legal and administrative barriers.
Many funds are structured for cross-border growth but still operate with single-market governance. Value-creation plans assume playbooks can be copied and pasted from one jurisdiction to another. “Regional champions” stall not because demand disappears, but because systems, processes and board rhythms have not been built to match the strategy.
The most effective firms in emerging markets price complexity upfront. Governance, financial infrastructure and cross-border coordination are treated as value enablers – not administrative overhead.
These firms align board calendars across jurisdictions, set clear expectations for reporting frequency and content, and invest early in people and platforms that can handle multi-country growth. In these markets, ambition is not enough – execution precision determines who wins.
Gap 2: The transparency tax – and blockchain as discipline
Private equity has long promised institutional-grade transparency: timely reporting, clear capital accounts and auditable waterfalls. Delivering that transparency has become expensive. Firms layer on ERP systems, reconciliation teams and long close cycles. LPs still wait weeks after quarter-end for numbers they cannot independently verify.
That is the “transparency tax” — a significant operational burden to provide information that ultimately still depends on trust rather than verification.
In parallel, the digital-asset world has been quietly building a different transparency model. Exchanges such as Luno and VALR now publish cryptographic proof-of-reserves reports that allow users to verify that customer balances are fully backed. These are not theoretical pilots – they are live attestations, repeated on a regular basis, supported by external assurance.
The same underlying technologies can be applied to parts of the private equity stack. Distributed ledgers can support more continuous verification of portfolio metrics, rather than purely quarterly “archaeology”. Smart-contract logic can be used to enforce co-investment terms and waterfalls automatically, reducing manual reconciliation and the risk of errors. Cross-border capital movements can be recorded in near real time with an immutable audit trail.
Most firms still see blockchain primarily through the lens of tokens and fund digitisation. The more immediate question is simpler: can distributed infrastructure reduce the cost and friction of the transparency we already owe investors?
The answer, increasingly, is yes — but only when combined with robust assurance, governance and regulatory design. Blockchain without assurance is speculation. Blockchain with assurance is infrastructure.
Gap 3: The tax structuring penalty
Headline IRRs tell only part of the story. The more hidden figure is the proportion of value that never reaches the LP because of avoidable tax leakages.
Gulf investors are now committing substantial capital to US and other international private equity funds. The opportunities are real — but so are the risks of unnecessary tax drag if structures are not carefully designed and maintained.
A common pattern illustrates the point. A Gulf LP invests $50 million into a US real estate fund, targeting an 18 per cent IRR and assuming treaty-level withholding relief through its chosen investment vehicle. Without robust structuring and documentation, effective tax outcomes can look very different: up to 37 per cent withholding on effectively connected income for direct investments; a 30 per cent branch profits tax plus dividend withholding if the wrong blocker structure is used; and 15 per cent withheld on the sale of US real-property interests under FIRPTA, even when relief might be available in principle.
Over a typical seven-year holding period, that can mean $5–8 million lost to tax that could, in many cases, have been mitigated. That is the difference between top-quartile and third-quartile performance.
The underlying issue is often a “treaty realisation gap”. Routing investments through a treaty jurisdiction does not, by itself, secure treaty benefits. The outcome depends on vehicle selection, pre-investment planning, timely completion of forms and ongoing compliance at federal and state level. Missing one element can bring investors back to full statutory rates.
Disciplined LPs are now treating tax structuring as part of deal architecture. Before signing subscription documents, they model alternative structures and ask a direct question: which entity structure do you recommend for our jurisdiction, and what does our after-tax IRR look like under each scenario? If the answer is vague, they reconsider the commitment.
Gap 4: Due diligence as an execution filter
In an environment where capital is plentiful, the real constraint is capacity to execute. Due diligence has therefore shifted from a backward-looking check to a forward-looking filter on execution risk.
Traditional financial due diligence remains essential, but it is no longer sufficient. Commercial, operational, technological and ESG considerations all need to be assessed early. That means testing whether leadership teams are truly equipped for cross-border growth, whether finance and IT systems can support multi-jurisdiction reporting from day one, whether key licences and contracts can withstand regulatory change, and whether sustainability plans are credible in light of tightening disclosure and transition expectations.
This is particularly important in the Gulf, where the ambition to build “regional champions” is common, but the execution path is demanding. The most effective investors now use the due-diligence phase to identify structural execution gaps and decide whether they can be closed within a realistic timeframe and budget. Where the gaps are too wide, they walk away, even if the headline numbers look attractive.
In that sense, due diligence is becoming less about finding problems after the fact and more about deciding which execution risks a fund is willing to own.
From capital to creation
Global private equity is entering a new phase. Capital is not the scarce resource. Execution capacity is.
For Gulf investors, this shift is particularly significant. Sovereign wealth funds and family offices in the region are no longer simply passive providers of capital; they are increasingly influential in shaping how global funds operate and where they deploy. At the same time, GCC economies are projected to grow by around 3.5 per cent in 2025, and private equity is expected to play an important role in delivering that growth.
The firms that will define the next chapter of private equity will not be those with the boldest theses or the largest pools of capital. They will be those that recognise execution architecture as a source of competitive advantage: building governance that can keep pace with cross-border growth, investing in technology that makes transparency structural, integrating tax into deal design rather than treating it as an afterthought and using due diligence to filter for execution risk as much as financial return.
The capital is ready. The opportunities are real. The question, for Gulf investors and global managers alike, is whether their execution infrastructure is ready to match their strategic ambition.
About the authors
Candice Czeremuszkin is Global Private Equity Sector Lead at Moore Global and Managing Partner of Moore in the Cayman Islands.
Dale Russell is Director of Moore Blockchain & Digital Assets in Johannesburg and Founder of TrustReserve Solutions.
Josh Whitworth is a Tax Partner at The Bonadio Group (Moore North America), specialising in international tax structuring.
Gurkaran Singh is a Partner at Moore JFC Dubai, focusing on strategy, corporate governance and advisory services across the Middle East.
