Key Facts About Private Equity
- Private Equity assets under management hit $4.3 trillion in 2016. It is predicted to reach $15 trillion over the next decade growing by 3.5 times.
- Capital committed to private equity funds in 2016 hit an all-time annual record of $681 billion, beating the previous high set in 2015 by 9 percent.
- First-time private equity managers raised a record sum of $83 billion, about 12 percent of all the monies raised for private equity during 2016.
- The global venture capital deal value hit more than $100 billion in 2016.
- Private equity and buy-out funds focus on investing capital in more mature businesses that demonstrate the potential for growth in value and enhancing their performance over a prolonged period through structural, strategic management and operational improvements.
- Venture Capital funds largely invest capital in start-up and young companies with little or no track record.
- Hedge funds act as pools of capital that usually invest in stocks, bonds or commodities and aim to capitalise on short-term gains, using complicated trading strategies and derivative financial instruments.
- PE firms exit from a portfolio company usually through: an initial public offering (IPO) or flotation of the portfolio company on the stock market; a "trade sale" of the company to a strategic acquirer through a merger or acquisition (M&A); or a "secondary sale" to another private equity house.
Source: Forbes, Jan 25, 2017, Ten Predictions for private equity in 2017. Go back to Analysis & Research