So this is one of the biggest opportunities that we have in front of us and we believe we’re going to be able to capture those opportunities.
Operator: Thank you. Your next question comes from Michael Cyprys with Morgan Stanley.
Laurence Fink: Good morning, Michael.
Michael Cyprys: Hi, good morning. Question on private markets. If we go back to Investor Day, you guys spoke about doubling base fees in private markets over the next five years, so I was hoping you might be able to help unpack the drivers of that and where might there be scope for upside such as with new products at a more meaningful scaling up your existing strategies?
Laurence Fink: I want to give that to Martin.
Martin Small: Great. Thanks, Michael, how are you? I’d start with clients, which is the client need for income and uncorrelated returns in a higher inflation world with more volatile public equities, we think that will continue to drive demand for alternatives. And most definitely, we saw that in our BlackRock Global Private market survey that we recently completed, over half the clients said that they expect to increase their allocations to private markets and alternatives. We think we’re really well-positioned there. We’ve built a comprehensive platform As you heard from Edwin on Investor Day, provides exposures across all our liquid alternative asset classes, and we’re really well-positioned as a multi-alternatives provider.
Larry talked a bit about some of the differentiated sourcing and access to high quality opportunities that we’ve had, our ability to integrate private markets investing with technology with eFront and Aladdin, we really think that that’s a great opportunity for us as we move forward. Our platform is over $150 billion in private markets today. In the second quarter, we had 10% organic growth on illiquid, which we think is good strong growth. We talked to you about adding nearly $2 billion of base and performance fees in 2022 and our fundraising has actually held up pretty well since 2021. We’ve raised over $85 billion of gross capital. And I think, where some of the upside is, is really I think, one in private credit and infrastructure. We’ve built really strong leading franchises and we see good growth there in the next three to five years in private credit as banks potentially become more constrained in lending.
We think investors will turn more to private credit for financing, and if you like those yields in the low-interest rate environment, I think investors will find them even more compelling in a more normalized rate environment. And then also some of these extraordinary government stimulus and tax incentives that I think are following the Inflation Reduction Act, similar moves I believe coming in Europe are going to be, I think strong secular tailwinds for infrastructure. Last thing I’d just say is, there’s upside on product innovation, which is, one, we’ve already done some really compelling innovating in decarbonization, both in sourcing deals and in raising assets in this space. We’ve launched a number of non-traded products across private credit, real-estate debt, and 40 Act private equity into retail and wealth channels.
And I think the next horizon for us is to think about how to integrate these things in positions of strength in BlackRock like model portfolios. How do you really build that portfolio of the future that Larry referenced that’s public, private, digital, tax managed, those are the places where we see real, real upside for BlackRock.
Operator: Thank you. We’ll take our next question from Mike Brown with KBW.
Laurence Fink: Hi, Mike.
Michael Brown: Hi, good morning, everyone. I just wanted to talk about the expectation for expenses this year, so obviously, equity markets have been up year-to-date, S&P is up over 17%, and that’s provided a nice boost for AUM. How do you guys think about the earnings power today in the context of BlackRock’s expense base and your investment priorities? Have you already planned to allocate more dollars towards investment in the platform and other people tanker capabilities?
