The last two years have been very good for investors in private equity. The industry has distributed large amounts to its investors, $444 billion in 2014 and $561 billion in 2013. More importantly, it distributed in 2014 again much more, $177 billion, than it invested (Preqin). These large distributions combined with double digit median returns since 2000 should make everybody happy...
The private equity industry has given back $ 230 billion to its investors in 2013 or nearly half a trillion ($ 469 billion) over the last two years, according to Pitchbook, a private equity data provider. The last 2 years have been favorable to the private equity industry wanting to return money to its investors. The best example may well be Apollo. “There’s a time to reap and there’s a time to sow”...
All private equity may look the same to outsiders, but it is not. Politicians and the press usually generalize and in reality focus on the most spectacular, read largest, investments, the “mega” buyouts with the occasional success story from venture capital, like Facebook. The graph below (source Preqin) is an over-simplification but illustrates that the returns of the different types of private equity...
China-based Alibaba just did the largest IPO ever at $25 billion and there will be a lot of chest pounding by its early private equity investors (and Yahoo) including Silver Lake, GGV, Goldman Sachs (apparently already an investor in 1999), Fidelity Growth and Venture TDF. Apparently Alibaba also registered the name “Alimama” in case someone wants to marry them, but most people...
Co-investments have been an interesting and positive feature of private equity investing for a long time. However, in times of abundant money, there is also an abundance of co-investments and on average they are much less interesting.
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