Private Equity Performance: A Survey

Berk A. Sensoy () and Steven Kaplan ()
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Berk A. Sensoy: Department of Finance, Fisher College of Business, Ohio State University, Columbus, Ohio 43210

Annual Review of Financial Economics, 2015, vol. 7, issue 1, 597-614

Abstract: We survey the literature on private equity performance, focusing on venture capital and buyout funds rather than on portfolio companies. We describe recent findings on performance measures, average fund returns, risk adjustments, cyclicality and liquidity, persistence, interim returns and self-reported net asset values, the performance of different types of investors in funds, and the links between management contracts and fund returns. Buyout funds have outperformed the S&P 500 net of fees on average by approximately 20% over the life of the fund. Venture capital funds raised in the 1990s outperformed the S&P 500, whereas those raised in the 2000s underperformed. The results are consistent across a number of data sets and papers. Before the 2000s, buyout and venture capital fund performance showed strong evidence of persistence. Since 2000, buyout fund persistence has declined, whereas venture capital fund persistence has remained equally strong.

Keywords: contracts; performance; persistence; private equity; returns; risk (search for similar items in EconPapers)
JEL-codes: G12 G24 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (18)

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Working Paper: Private Equity Performance: A Survey (2014)
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