Mercer Advisors Builds In-House Fund-of-Funds, Bypassing Platforms
Mercer Advisors has launched a proprietary private markets fund-of-funds, signaling how large RIAs are cutting out intermediary platforms to reduce fees and control due diligence.
Mercer Advisors has launched Aspen Partners, a proprietary private markets fund-of-funds for its ultra-high-net-worth clients. The two-year-old platform represents a direct challenge to third-party intermediaries like iCapital and CAIS. By acting as its own general partner, the $115 billion registered investment adviser is sourcing and managing private equity, venture, and credit exposures entirely in-house.
The move fundamentally alters how the largest wealth managers distribute private market allocations. Historically, even well-resourced RIAs routed client capital through external platforms, a process that often resulted in ad hoc access, layered fees, and inconsistent due diligence. Running an independent GP entity staffed by its own employees allows Mercer to negotiate directly with underlying managers and apply the same institutional rigor used by pensions and endowments.
Don Calcagni, Mercer’s chief investment officer, noted that clients were already paying an advisory fee, making the extra costs of intermediary platforms particularly punitive. "We observed that a lot of fund-of-funds structures get stuffed with mediocre GPs and layered with a 1-and-10 or 1-and-15 fee on top," Calcagni said. Stripping out this specific middleman layer directly improves net returns for ultra-high-net-worth investors.
This shift is only possible because a new tier of institutional-caliber RIAs has emerged. Managing $115 billion gives Mercer the scale to hire dedicated private markets professionals and secure relationships with top-tier service providers like Deloitte and Paul Weiss for fund formation. Smaller firms historically lacked the capital to support this infrastructure, leaving platforms like iCapital and CAIS to fill the void for the broader RIA and broker-dealer channel.
Fintech is also accelerating the trend. Calcagni noted that turnkey solutions from technology providers like Opto Investments—Mercer’s partner on the project—and Arch allow RIAs to plug in and operationalize their own fund vehicles quickly. This lowers the administrative barrier to entry for large firms looking to internalize their alternative investment operations.
Aspen Partners highlights a broader inflection point in the wealth management industry. As mega-RIAs continue to gather assets, their operational capabilities are converging with those of traditional institutional allocators and multi-family offices. For the third-party distribution platforms that built their businesses on serving the advisory channel, the loss of their largest clients poses a distinct structural threat.
