Download Report

Executive Summary - Sample Pages
1
2,000
Unrealized
Portfolio Value
($bn)
Dec-13
Dec-12
Dec-11
Dec-10
Dec-09
Dec-08
Dec-07
Dec-06
Dec-05
Dec-04
Dec-03
0
Dec-02
500
Dec-01
1,000
2,546
2,332
2,029
563
1,783
409
1,265 1,413
298 377 407 402
898
1,204
675
418 374 360 465 554
Dec-00
1,500
Dry Powder
($bn)
1,067
1,011
1,075
806
Fig. 1.2: All Private Equity - Annual Amount Called-Up, Distributed and Unrealized
Value
500
0
2013
100
2012
1,000
2011
200
2010
1,500
2009
300
2008
2,000
2007
400
2006
2,500
2005
500
2004
3,000
2003
600
2002
Secondaries funds emerge as the best
performing fund type, with the highest
median net IRR and a relatively low risk
measure. The private equity secondary
941
1,007
993
2,500
Risk and Return
Also revealed in the 2014 Private Equity
Performance Monitor is Preqin’s latest
analysis of risk-return trade-offs, broken
out by geographic focus, fund strategy and
vintage year. By plotting the median against
the standard deviation of net IRRs, we are
able to examine which fund types have
the most attractive risk-return profile. As
explained in Chapter 12, and seen in Fig.
1.3, a significant range is displayed across
both axes for the different private equity
investment strategies. Though there are
risks inherent in any illiquid market such as
private equity, the level of risk between the
different fund types varies by some margin.
1,174
3,000
Unrealized Value ($bn)
As confirmed in Preqin’s latest Investor
Outlook survey, LPs are still looking
to increase their allocations to private
equity, and as upticks are seen in annual
fundraising figures, the industry’s assets
under management (AUM) have continued
to climb ever higher. In fact, since the turn of
the millennium, the private equity industry’s
AUM have risen year on year, and have
attained the highest figure to date of $3.7tn
as of 31 December 2013. Preqin calculates
AUM by adding the uncalled capital
commitments (dry powder) to the unrealized
value of portfolio assets, as displayed in Fig.
1.1, which illustrates the steady incremental
increases in unrealized portfolio value each
year, and the record amount of private
equity dry powder available as of December
2013.
3,500
2001
In last year’s Preqin Private Equity
Performance Monitor, we acknowledged
the economic turmoil that was endured by
the industry following the crash of 2008,
the onset of the European sovereign debt
crisis, and the fluctuations around these
events. All-in-all, the progress of the private
equity market since the downturn six years
ago has been encouraging, reflected in the
ever increasing amounts of capital investors
around the world commit to the asset class.
Furthermore, and perhaps most notably
for investors, performance data shows that
distributions have increased considerably
over the past year, from $381bn in 2012 to
$568bn in 2013, making it the highest level
of capital LPs have ever received back from
their private equity investments in a year.
Fig. 1.2 displays the new peak, and more
trends in private equity dry powder and
AUM are discussed in Chapter 11.
Annual Amount Called/Distributed ($bn)
Record Highs
4,000
2000
1. Executive Summary
Fig. 1.1: All Private Equity - Assets Under Management, 2000 - 2013
Assets under Management ($bn)
The 2014 Preqin Private Equity Performance Monitor
Capital
Called
($bn)
Capital
Distributed
($bn)
Unrealized
Value
($bn)
0
© 2014 Preqin Ltd
Executive Summary - Sample Pages
2
Preqin’s tables of consistent performing
managers, featured in the 2014 Preqin
Private Equity Performance Monitor, can
help with this task. Each fund that Preqin
has performance data for is assigned a
quartile ranking using Preqin’s Performance
Analyst online service, which contains
performance data for over 7,000 private
equity funds worldwide. These rankings are
based upon the peer group of each vehicle
and take into account vintage year, strategy
and geographic focus. Both the multiple and
IRR are used as key indicators and equal
emphasis is placed on both metrics.
Risk - Standard Deviation of Net IRR (%)
Balanced
Buyout
20%
Distressed Private Equity
Fund of Funds
Growth
15%
Infrastructure
Mezzanine
10%
Natural Resources
Real Estate
Secondaries
5%
Venture Capital
Early Stage
0%
0%
5%
10%
15%
20%
Return - Median Net IRR (%)
Fig. 1.4: Rolling One-Year Horizon IRRs by Fund Type
30%
25%
All Private
Equity
20%
Buyout
15%
10%
Venture
Capital
1 Year to Dec 2013
1 Year to Sep 2013
1 Year to Jun 2013
1 Year to Mar 2013
1 Year to Dec 2012
1 Year to Sep 2012
1 Year to Jun 2012
1 Year to Mar 2012
0%
1 Year to Dec 2011
Fig 1.5 shows a list of the top six consistent
performing buyout fund managers and their
average quartile rank. Funds ranked in the
top quartile are given a score of one, funds
in the second quartile are scored a two,
and so on. The table is compiled using only
funds for which Preqin holds performance
1 Year to Sep 2011
5%
1 Year to Jun 2011
2013 saw an uptick in venture capital
performance as a whole. Fig. 1.4 depicts
the rolling one-year horizon IRRs for the
whole private equity industry, as well as
buyout and venture capital. Venture capital
outperforms its buyout counterparts and the
whole private equity asset class with a return
of 19.7% in one year to December 2013.
The importance of finding consistent
performing fund managers is crucial for any
investor that wants maximum reassurance
that their fund commitment will be in safe
hands. Though past performance is no
guarantee of future returns, data such
as the performance metrics available on
Preqin’s Performance Analyst are highly
valuable tools to help benchmark funds and
inform LP decisions.
25%
1 Year to Mar 2011
On the other side of the spectrum, we find
early stage funds with a much less attractive
risk-return profile. However, the high
standard deviation in the chart highlights
the wide range of net IRRs that can be
attained, and therefore suggests that early
stage funds still offer the potential of hitting
a lucrative ‘home run’ investment.
Consistent Performers
Fig. 1.3: Risk and Return by Strategy (Vintage 2001 - 2011)
1 Year to Dec 2010
Highs and Lows of Venture Capital
Performance
The increase from previous quarters can be
linked to the improved exit opportunities and
high valuations in recent times.
Horizon IRR
market has gone from strength to strength,
breaking records for fundraising and
transaction volume year on year. The
growth and maturation of the secondary
market has been tracked by Preqin over
time, as has the increasing number of
investors that have expressed an interest
in buying or selling fund stakes in order to
reap a range of benefits. For sellers, this
includes meeting liquidity requirements,
portfolio rebalancing, and the opportunity
to exit poor performing funds. For buyers,
secondary market purchases will help
mitigate the J-curve effect inherent in private
equity commitments, and provide access to
top performing managers and chances to
acquire fund stakes at a good discount to
NAV.
© 2014 Preqin Ltd
Executive Summary - Sample Pages
data and has assigned a quartile ranking.
Additionally, 2012, 2013 and 2014 vintage
funds have been excluded as these funds
are too early in their fund lives to generate
meaningful IRRs. The list only includes fund
managers that have raised at least three
funds of a similar strategy.
Four buyout fund managers, Rhone
Capital, Altor, Wynnchurch Capital Partners
and Trilantic Capital Partners have all
of their funds ranked in the top quartile,
and therefore have achieved the best
possible average quartile rank of 1.00.
Morgan Stanley Global Private Equity and
Waterland follow, each with a score of 1.20.
Extended lists of consistent performing fund
managers, broken out into various fund
types, are available in Chapter 3 of the
Performance Monitor.
The 2014 Preqin Private Equity
Performance Monitor
We are proud to be launching the eleventh
edition of the Performance Monitor,
celebrating over a decade of providing
net-to-LP returns data to the private equity
community. This edition contains key metrics
for over 7,000 funds, representing 70% of
the total capital raised by the industry.
Additionally, multiple sources are used to
ensure accuracy. We hope that you find this
year’s edition of the Performance Monitor to
be a useful and effective tool and, as ever,
welcome any feedback that you may have.
This edition of the Performance Monitor
features the PrEQIn Private Equity
Quarterly Index, regional performance of
private equity funds, and 10-year horizon
IRRs, as well as analysis of private equity
performance by fund type, size and region.
In addition, the Monitor explores the effects
of past performance on private equity
fundraising, performance benchmarks for
the different fund types, regions and vintage
years, as well as an analysis of listed private
equity performance, synthetic IRRs for
private equity funds of funds, dry powder
and assets under management, and more.
Preqin gathers its performance information
directly from both fund managers and
investors, ensuring that the full spectrum
of private equity fund performance is
observed, be it positive or negative.
Fig. 1.5: Top Six Consistent Performing Buyout Fund Managers
Firm
Location
Overall Number of Funds
with Quartile Ranking
Number of Funds in Top
Quartile
Number of Funds in
Second Quartile
Average Quartile Rank
US
3
3
0
1.00
Sweden
3
3
0
1.00
Wynnchurch Capital Partners
US
3
3
0
1.00
Trilantic Capital Partners
US
3
3
0
1.00
Morgan Stanley Global Private Equity
US
5
4
1
1.20
Netherlands
5
4
1
1.20
Rhone Capital
Altor
Waterland
3
© 2014 Preqin Ltd
The 2014 Preqin
Private Equity Performance Monitor
A comprehensive guide to private equity performance
Contents - Sample Pages
Contents
1.
Executive Summary
5
2.
Methodology
9
3.
Consistent Performing Fund Managers
13
12.
Top Performing Funds
13.
PrEQIn - Private Equity Quarterly Index
19
14.
Effects of Past Performance on Private Equity Fundraising
43
47
Effect of predecessor fund performance on time spent on road by
funds closed in 2012/13; effect of predecessor fund performance
on subsequent fundraise vs. initial fundraising target; effect of
predecessor fund performance on time spent on the road for funds
currently in market.
7.
Performance Data in a Global Context
15.
How Much Have Investors Gained Historically?
Private Equity Horizon IRRs
95
17. Overall Performance of Private Equity
59
99
101
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; money-weighted and pooled IRRs;
IRRs by geographic focus; fund IRR deviations from benchmark; cash
flows; J-curves; relationship between quartile ranking and manager
experience; relationship between predecessor and successor fund
quartiles.
55
18.
Buyout
105
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; money-weighted and pooled IRRs;
IRRs by fund size; fund IRR deviations from benchmark; cash flows;
J-curves; relationship between predecessor and successor fund
quartiles; fund performance listings.
63
Annual change in NAV; quarterly change in NAV for all private equity
and buyout by fund size; quarterly change in NAV by fund type;
capital appreciation/depreciation of NAV during 2013.
11. Dry Powder and Assets under Management
Data Coverage
Explanation of ratios and data used in the graphs.
One-, three-, five- and 10-year horizon IRRs as of 31 December
2013; private equity horizon IRRs vs. public indices; buyout fund
horizon IRRs by size; regional IRRs; rolling one-year and three-year
horizon IRRs by fund type.
10. Change in Fund Valuations
77
16. How to Interpret Performance Ratios for Private Equity Funds
49
Net LP gain by vintage year; horizon returns by asset class of public
pension funds; one-year returns to December 2013; private equity vs.
total investment portfolio and listed equity.
9.
Market Benchmarks
Fund universe; Preqin performance coverage by type and region.
North America-focused funds; Europe-focused funds; Asia-focused
funds; Africa-, Latin America and Caribbean-, Australasia- and Middle
East and Israel-focused funds.
8.
75
All Private Equity: All Regions; North America; Europe; Asia.
Buyout: All Regions; North America; Europe; by fund size
Fund of Funds
Mezzanine
Infrastructure
Distressed Private Equity
Growth
Real Estate
Venture Capital: All Regions; North America; Europe; Early Stage
Secondaries
PrEQIn Quarterly Private Equity Index: all strategies; buyout by fund
size; venture capital by investment stage; fund quartile indices.
6.
Performance of Listed Private Equity
Overview of listed private equity; share prices; discounts and
premiums to net asset value; performance listings.
Rankings of top performing funds by fund type and vintage year.
5.
71
Risk and return by fund strategy; IRR deviation from benchmark; risk
and return for buyout, distressed private equity, real estate, venture
capital, fund of funds and secondaries.
Buyout, venture capital, fund of funds, real estate and other fund
managers that have consistently produced top quartile returns.
4.
Risk and Investment Selection
67
19.
Distressed Private Equity
147
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; IRR dispersion; distributions to paidin capital ratios – median and quartile boundaries; residual value
to paid-in capital ratios – median and quartile boundaries; fund
performance listings.
Private equity assets under management; dry powder by region
focus; buyout dry powder by fund size; venture capital dry powder by
investment stage; annual amount called, distributed and unrealized
value.
5
© 2014 Preqin Ltd
Contents - Sample Pages
20.
Fund of Funds
157
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; fund IRR deviations from benchmark;
cash flows; J-curves; relationship between predecessor and
successor fund quartiles; fund performance listings; synthetic IRRs
for private equity funds of funds of different allocation mixes.
21.
Growth
183
Called-up capital, distributed capital and residual value; median
net IRRs and quartile boundaries; median multiples and quartile
boundaries; IRR dispersion; money-weighted IRRs; fund
performance listings.
22.
Infrastructure
193
Called-up capital, distributed capital and residual value; minimum,
median and maximum IRRs; median multiples and quartile
boundaries; fund performance listings.
23.
Mezzanine
201
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; fund IRR deviations from benchmark;
cash flows; IRR dispersion; fund performance listings.
24.
Real Estate
211
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; IRR dispersion; fund IRR deviations
from benchmark; value added vs. opportunistic multiples; cash flows;
relationship between quartile ranking and manager experience;
relationship between predecessor and successor fund quartiles; fund
performance listings.
25.
Secondaries
249
Called-up capital, distributed capital and residual value; median net
IRRs and quartile boundaries; money-weighted IRRs; cash flows;
IRR dispersion; fund performance listings.
26.
Venture Capital
255
Called-up capital, distributed capital and residual value; median
net IRRs and quartile boundaries; money-weighted and pooled
IRRs; early stage vs. other venture IRRs; healthcare vs. IT IRRs;
fund IRR deviations from benchmark; cash flows; J-curves;
relationship between quartile ranking and manager experience;
relationship between predecessor and successor fund quartiles; fund
performance listings.
27.
Other Fund Types Performance Listings
307
Balanced; co-investment; co-investment multi-manager; direct
secondaries; natural resources; timber
28.
Index
321
Firm Index
Figure Index
6
29.
Glossary
349
30.
Performance Analyst Online
351
© 2014 Preqin Ltd
Methodology - Sample Pages
2. Methodology
The content of the 2014 Preqin Private
Equity Performance Monitor is focused on
the performance of private equity funds
available to institutional investors, and as
a result, excludes direct investments in
unlisted corporate securities.
The fund-level performance data and all
related analysis herewith is taken from
Performance Analyst, our online service and
the world’s most extensive and transparent
source of private equity performance.
Launched in 2003, Performance Analyst
initially held data for 1,086 funds. This
figure has since grown substantially, and at
present, Performance Analyst holds fundlevel data for over 7,000 funds, representing
a 7.2% increase from the previous year. In
terms of total capital raised, Performance
Analyst contains data for over 70% of all
funds raised historically. Subscribers to
Performance Analyst will be able to view
all of the data contained within the Monitor
online, in addition to obtaining fund level
performance data updated on a regular
basis. Further information can be found at:
www.preqin.com/pa.
Preqin reports fund-level performance data
which is representative of the investor’s
experience. Therefore, all the figures
presented within the Monitor show the
net position to the investor, and all returns
7
information is based on the institutional
investor’s position before tax, but after the
GP’s managed and carried fees have been
deducted.
Performance figures held by Preqin are
obtained from various sources and via
varying means. The majority of performance
figures are attributed to institutional
investors and are obtained via Freedom
of Information Act (FOIA) requests; these
requests include CalPERS, Washington
State Investment Board, and Florida State
Board of Administration among many others
both in the US and the UK. We currently have
approximately 350 (active and web-based)
public pension funds and endowments that
are contributing performance figures to
Preqin.
In addition to obtaining performance
figures via FOIA requests, Preqin also
receives performance data directly from
GPs themselves. As a significant proportion
of our online subscribers consist of
prospective investors viewing performance
figures on a fund level, GPs inevitably
recognize the importance of providing the
most accurate and the most recent data,
consistent with our net-to-LP performance
metrics definitions, to ensure the funds are
represented both accurately and in line with
our methodologies.
Our wide range of data sources and our
extensive research program allows us
to verify data for funds on an individual
basis, ensuring a high level of confidence
in the accuracy of the data held. Preqin
greatly appreciates GPs contributing fund
performance data: therefore we are happy
to offer those GPs complimentary access
to our Performance Benchmark module
within Performance Analyst, in addition
to discounted access to the full version of
Performance Analyst. Should you require
further information, or wish to contribute
performance data, please contact us at
[email protected] or visit our website
at www.preqin.com/pa.
Preqin acknowledges the importance of GP
feedback on each fund. Hence, prior to the
release of the Monitor, GPs were invited
to comment and amend their individual
fund performance, ensuring that the data
included within this publication is accurate
and up to date. This process took place
during June 2014, though we are still happy
to receive any additional feedback, and this
will be incorporated onto our database once
received.
The dates to which the performance figures
relate are provided in the fund listings
and are an important consideration for
the readers to ensure the data is correctly
interpreted. The Monitor shows the most
up-to-date information at the time of going
to press in July 2014. The majority of the
data presented in this book is as of the
fourth quarter of 2013 or the first quarter of
2014. On occasion, data that is older than
this will be included and will mostly relate to
funds with more mature vintages that have
already distributed the majority of the capital
back to investors and hence the data is not
expected to change significantly.
In order to ensure the most appropriate
fund-level comparisons are conducted,
percentages have been used to represent
all performance metrics. The following chart
gives a representation of performance
metrics displayed in the fund listings section
of the Monitor. ‘Called percentage’ refers
to the ratio of capital called at the specified
date against the total amount committed
to the fund. ‘Distributed to paid-in capital
(DPI)’ refers to the amount received by the
investors as a percentage of the paid-in
capital to date. The ‘residual value to paidin capital (RVPI)’ percentage measures the
remaining value of the portfolio expressed
as a percentage of paid-in capital to date.
The multiple is the sum of the distribution
and the remaining value figures, expressed
as a times factor of the total capital called to
date. Finally, Preqin defines the vintage year
as the year in which the first investment was
© 2014 Preqin Ltd
Methodology - Sample Pages
made from the fund using LP capital (i.e.
the year of the first capital call to LPs for
investment).
Preqin generates benchmarks for all the
main performance metrics - called, DPI,
RVPI, multiple and IRR - using the median,
average, pooled or money-weighted value.
However, due to the space limitation within
the Monitor, the Monitor only displays
the median IRR benchmark figures. All
benchmark figures generated by Preqin
are available to subscribers of Performance
Analyst, in addition to the feature of creating
custom benchmarks from their individual
user-defined
fund
universe.
Preqin
benchmark data is transparent and allows
subscribers to view the constituent funds.
debt, special situations, turnaround, real
estate, infrastructure, natural resources,
balanced, secondaries funds and funds
of funds. Additional notes regarding our
terminologies and methodologies can be
found in Chapter 29: Glossary, or on our
website at www.preqin.com, and should
readers of the Monitor have any further
questions, they are most welcome to
contact us.
Preqin Ltd.
July 2014
Additionally, Preqin generates quartile
rankings for individual funds. Each fund
universe constitutes funds with similar
fund types, geographies and vintage
years, enabling the quartile rankings to
be assigned using a combination of both
the IRR and multiple rankings of each
constituent fund, with equal weights being
placed on each the IRR and multiple. In
instances where the sample size is small,
the funds are assigned quartile rankings
which are generated against the private
equity industry in its entirety.
The 2014 Preqin Private Equity Performance
Monitor aims to conduct analysis and
provide insight into all private equity types
from many different geographic regions.
Preqin uses the term “private equity” to
denote a variety of fund types: buyout,
venture capital, mezzanine, distressed
8
© 2014 Preqin Ltd
Methodology - Sample Pages
1. Called (%):
6. Benchmark IRR (%):
Percentage of LP’s commitment contributed to date.
The median IRR for the relevant peer group. We have specific
benchmarks for buyout, venture capital, early stage, fund of
funds, real estate and mezzanine funds. Funds of a different
type are benchmarked against “All Private Equity”.
e.g. an LP with a $1mn commitment will have paid in
$900,000 to date.
e.g. in this case vintage 2008 North America buyout funds.
10. Fund Specifics:
2. Distributed (%) DPI:
8. As at:
Fund size is the total commitment received by the fund. Vintage and region focus are used for
benchmarking.
Distributions received to date as a percentage of
called capital.
This is the ‘as at date’ for the
valuations and performance.
e.g. in this case, the benchmark is 2008 US buyout funds
e.g. an LP with a $1mn commitment has received
$292,500 – this is 32.5% of the $900,000 called.
e.g. in this case the data is valid as of
31 Dec 2013.
Firm name
Fund
Vintage
Size (mn)
Location
Focus
Called
(%)
Distributed
(%) DPI
Res. Value
(%) RVPI
Net Multiple
(X)
Net IRR
(%)
Benchmark
IRR (%)
Quartile
As at:
Mega Capital Partners
Mega Fund I
2008
100 USD
North America
90.0
32.5
105.1
1.38
8.0
8.0
2
31-Dec-13
Mega Fund II
2009
50 USD
North America
60.0
29.7
52.7
0.82
-6.5
4.0
4
31-Dec-13
Example Capital Partners
Example Fund I
2005
500 USD
Europe
100.0
219.0
36.3
2.55
46.4
28.1
1
31-Dec-13
Example Fund II
2007
700 USD
Europe
90.0
13.9
112.4
1.26
10.3
10.3
3
31-Dec-13
7. Quartile:
3. Residual Value (%) RVPI:
9. Firm Name/Fund:
The name of the fund manager and their
corresponding fund.
Valuation of unrealized investments as percentage of
called capital.
This shows which quartile of the relevant
peer group the fund falls into. We put
equal weight on the IRR and value
multiple.
e.g. an LP with a $1mn commitment has unrealized
investment valued at $945,900 – which is 105.1% of
the $900,000 called.
e.g. Mega Fund I is a second quartile
fund.
4. Net Multiple (X):
5. Net IRR (%):
Distributions plus unrealized value.
The net IRR earned by the LP to date after fees and
carry.
e.g. in this case 1.38 – which is
(35.5%+105.4%) / 100
9
e.g. in this case 8.0%, counting both distributions and
unrealized value.
© 2014 Preqin Ltd
Top Performing Funds - Sample Pages
Top Performing North American Funds
Fig. 4.39: Top 10 Best Performing North American Private Equity Funds
Rank Fund
Firm
Vintage
Fund Size
(mn)
Type
Region Focus
Called
(%)
Distributed
(%) DPI
Value (%)
RVPI
Multiple
(X)
Net IRR
(%)
Date
Reported
1986.2
0.0
19.86
514.3
30-Jun-14
1
Matrix Partners V
Matrix Partners
1998
200 USD
Venture Capital
North America
100.0
2
Benchmark Capital Partners II
Benchmark Capital
1997
125 USD
Venture Capital
North America
100.0
723.6
0.0
7.24
267.8
30-Jun-14
3
Matrix Partners IV
Matrix Partners
1995
125 USD
Venture Capital
North America
100.0
2051.1
0.0
20.51
218.3
30-Jun-14
4
Focus Ventures I
Focus Ventures
1997
106 USD
Venture Capital
North America
100.0
539.2
0.0
5.39
213.0
30-Jun-14
5
Mayfield IX
Mayfield Fund
1997
252 USD
Early Stage
North America
100.0
653.7
8.8
6.62
195.7
30-Sep-13
6
Accel V
Accel Partners
1996
150 USD
Venture Capital
North America
100.0
1962.0
0.0
19.62
188.4
30-Jun-14
7
Battery Ventures IV
Battery Ventures
1997
200 USD
Venture Capital
North America
100.0
715.3
0.0
7.15
160.3
30-Jun-14
8
Quantum Energy Partners II
Quantum Energy
Partners
2000
225 USD
Natural
Resources
North America
72.4
521.8
0.2
5.22
138.0
31-Dec-13
9
Menlo Ventures VII
Menlo Ventures
1997
253 USD
Venture Capital
North America
100.0
471.0
0.0
4.71
135.6
30-Jun-14
WPG Venture Associates IV
Lightspeed Venture
Partners
1997
212 USD
Early Stage
North America
100.0
390.2
3.5
3.94
123.0
31-Dec-13
10
Funds to Watch
Fig. 4.40: Top Five Best Performing Buyout Funds (Vintage 2012 - 2014)
Rank Fund
10
Firm
Vintage
Fund Size
(mn)
Type
Region Focus
Called
(%)
Distributed
(%) DPI
Value (%)
RVPI
Multiple
(X)
Net IRR
(%)
Date
Reported
1
Thoma Bravo Fund X
Thoma Bravo
2012
1,275 USD
Buyout
North America
87.1
62.7
81.1
1.44
n/m
31-Mar-14
2
Platinum Equity Capital
Partners Fund III
Platinum Equity
2012
3,750 USD
Buyout
North America
21.9
42.4
94.9
1.37
n/m
31-Dec-13
3
Ridgemont Equity Partners
Fund I
Ridgemont Equity
Partners
2012
735 USD
Buyout
North America
43.5
13.8
121.8
1.36
n/m
31-Dec-13
4
Aquiline Financial Services
Fund II
Aquiline Capital
Partners
2012
743 USD
Buyout
North America
65.8
2.8
129.0
1.32
n/m
31-Mar-14
5
MBK Partners III
MBK Partners
2013
2,670 USD
Buyout
Asia
23.1
0.0
130.5
1.30
n/m
31-Dec-13
© 2014 Preqin Ltd
PrEQIn - Private Equity Quarterly Index - Sample Pages
The PrEQIn Private Equity Quarterly Index
draws on information taken from Preqin’s
Performance Analyst. It is a moneyweighted index that uses fund-level cash
flow transactions and net asset values
for over 7,500 individual private equity
partnerships - these funds have raised over
$4.1tn in aggregate capital.
The Index is created using the following
calculation:
Percentage change in quarter = [(NAV
at end of quarter + distributions during
quarter)/(NAV at start of quarter + call-ups
during quarter)] – 1.
These returns are then combined to form
an index with the starting value of 100 as of
31 December 2000. In addition to an overall
private equity index, we have calculated
11
PrEQIn Buyout
Index
PrEQIn Venture
Capital Index
PrEQIn Real
Estate Index
PrEQIn Fund of
Funds Index
PrEQIn Distressed
Private Equity
Index
S&P 500 Index
400
350
300
250
200
150
100
50
0
PrEQIn Private Equity Quarterly Index:
All Strategies
Fig. 5.1 shows the PrEQIn All Private Equity,
Buyout, Venture Capital, Real Estate, Fund
of Funds and Distressed Private Equity
Indices together with the S&P 500 rebased
to 100 as of 31 December 2000. Examining
these indices provides an insight into the
performance of the main private equity
fund types in comparison to each other, the
industry as a whole, and public markets.
The PrEQIn All Private Equity Index shows
an initial decline following the dot-com
crash in the early 2000s. The performance
of the industry subsequently improved
until December 2007, when the industry
experienced a decrease in performance that
continued through subsequent quarters.
This resulted from the financial crisis as
well as the introduction of mark-to-market
valuations during this time. After Q1 2009,
PrEQIn All Private
Equity Index
450
31-Dec-00
30-Jun-01
31-Dec-01
30-Jun-02
31-Dec-02
30-Jun-03
31-Dec-03
30-Jun-04
31-Dec-04
30-Jun-05
31-Dec-05
30-Jun-06
31-Dec-06
30-Jun-07
31-Dec-07
30-Jun-08
31-Dec-08
30-Jun-09
31-Dec-09
30-Jun-10
31-Dec-10
30-Jun-11
31-Dec-11
30-Jun-12
31-Dec-12
30-Jun-13
31-Dec-13
indices for the main private equity fund
strategies as well as buyout by fund size,
venture capital by investment stage and
private equity by performance quartile
ranking, allowing investors to analyze and
compare different parts of their private
equity portfolios. At this time, the figures for
Q2 2013 are finalized; however, Q3 2013
and Q4 2013 figures are preliminary and
subject to change.
Fig. 5.2: PrEQIn Private Equity Index: All Private Equity, Buyout and Venture Capital
vs. S&P 500
Index Returns
(Rebased to 100 as of 31-Dec-2007)
Assessing the performance of an investment
portfolio is an important and challenging
task for an investor, and many different
metrics are required when constructing
and maintaining an effective private equity
program. The PrEQIn Private Equity
Quarterly Index is the first index covering
the whole private equity industry, enabling
investors to compare the returns from their
private equity portfolios to those of other
asset classes.
500
160
140
PrEQIn All Private
Equity Index
120
100
PrEQIn Buyout
Index
80
60
PrEQIn Venture
Capital Index
40
S&P 500
20
0
31-Dec-07
31-Mar-08
30-Jun-08
30-Sep-08
31-Dec-08
31-Mar-09
30-Jun-09
30-Sep-09
31-Dec-09
31-Mar-10
30-Jun-10
30-Sep-10
31-Dec-10
31-Mar-11
30-Jun-11
30-Sep-11
31-Dec-11
31-Mar-12
30-Jun-12
30-Sep-12
31-Dec-12
31-Mar-13
30-Jun-13
30-Sep-13
31-Dec-13
Index
Fig. 5.1: PrEQIn Index: All Strategies
Index Returns
(Rebased to 100 as at 31-Dec-2000)
5. PrEQIn – Private Equity Quarterly
© 2014 Preqin Ltd
Market Benchmarks - Sample Pages
14. Market Benchmarks
Fund Type: All Private Equity
Vintage
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
1986
1985
1984
1983
1982
1981
1980
12
No. of
Funds
160
182
255
190
161
341
378
351
298
169
144
134
174
263
173
178
161
113
103
89
82
65
40
64
70
47
42
37
35
27
21
15
6
9
Geographic Focus: All Regions
Called (%)
12.7
30.0
47.4
71.2
82.0
86.6
91.3
94.7
97.3
98.9
99.1
100.0
100.0
99.1
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Median Fund
Dist (%)
DPI
0.0
0.0
3.6
14.4
24.3
30.0
38.5
49.4
72.1
100.0
129.6
132.0
149.0
133.0
140.6
143.2
159.3
165.0
186.8
188.3
232.4
176.8
222.4
207.6
227.2
221.1
210.2
193.7
218.6
216.0
175.5
191.3
150.3
234.6
Benchmark Type: Median
Multiple Quartiles (X)
Value (%)
RVPI
94.9
100.8
104.5
104.0
100.0
93.6
86.3
75.3
54.7
40.0
27.4
14.4
11.0
9.2
0.3
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
As at: 31 December 2013
IRR Quartiles (%)
IRR Max/Min (%)
Q1
Median
Q3
Q1
Median
Q3
Max
Min
1.03
1.19
1.27
1.42
1.55
1.48
1.51
1.50
1.62
1.74
1.93
2.04
2.15
2.00
1.83
1.90
2.33
2.19
2.48
2.59
3.40
2.54
3.01
2.56
3.26
3.11
3.30
2.47
3.00
2.93
2.89
3.06
n/m
3.85
0.96
1.07
1.13
1.27
1.33
1.31
1.33
1.30
1.35
1.44
1.57
1.58
1.61
1.46
1.42
1.45
1.63
1.67
1.87
1.88
2.32
1.77
2.23
2.08
2.27
2.21
2.10
1.94
2.19
2.16
1.76
1.91
1.50
2.35
0.84
0.95
1.02
1.12
1.15
1.14
1.12
1.08
1.03
1.08
1.30
1.26
1.29
1.01
0.92
1.10
1.22
1.26
1.38
1.35
1.53
1.34
1.74
1.42
1.55
1.78
1.36
1.43
1.51
1.58
1.53
1.70
n/m
1.80
n/m
n/m
n/m
19.0
20.0
16.3
12.7
10.1
12.6
15.0
21.6
26.0
25.1
19.2
15.4
17.1
24.1
25.5
29.2
36.5
42.7
28.7
33.0
25.3
30.5
30.1
20.3
16.2
17.8
14.7
25.4
15.8
n/m
22.4
n/m
n/m
n/m
13.3
13.6
11.2
8.4
6.9
7.4
8.7
12.8
12.7
13.0
10.4
9.2
9.7
12.8
13.2
17.9
18.3
21.7
18.6
23.4
16.8
16.0
15.7
14.5
12.0
13.0
12.5
10.9
9.7
13.1
14.1
n/m
n/m
n/m
8.0
6.7
6.4
4.2
2.0
3.5
2.5
7.2
6.9
6.4
1.4
1.0
2.6
4.8
6.5
9.4
10.1
10.9
7.9
11.9
8.4
10.9
10.5
7.2
5.7
8.5
7.5
5.5
7.0
n/m
9.2
n/m
n/m
n/m
81.3
448.0
46.0
58.2
32.8
105.5
79.8
239.7
93.0
94.0
138.0
154.7
1015.7
267.8
188.4
447.4
94.1
105.7
87.2
346.4
74.4
198.5
54.5
31.3
279.7
40.7
96.2
51.6
64.3
67.4
31.1
n/m
n/m
n/m
-95.1
-15.1
-25.3
-50.9
-100.0
-100.0
-26.0
-49.9
-47.2
-19.4
-96.0
-40.6
-100.0
-45.7
-33.3
-22.0
-22.6
-29.1
-49.9
-0.5
-35.9
-42.1
-9.3
-12.4
-4.9
4.0
1.7
-3.5
-1.6
0.5
-4.3
© 2014 Preqin Ltd
Buyout - Sample Pages
Buyout Fund Performance Listings
Firm Name
Fund
3i
3i 94 LMBO Plan
3i Europe Partners III
Fund Size
(mn)
Region Focus
Called
(%)
Distributed
(%) DPI
Res. Value
(%) RVPI
Multiple
(X)
1994
170 GBP
Europe
98.4
140.0
0.0
1.40
11.7
30.5
4
30-Jun-14
1999
2,300 EUR
Europe
90.5
204.0
0.0
2.04
19.3
14.0
1
31-Mar-14
Vintage
Net IRR Benchmark
(%)
IRR (%)
Quartile
Date
Reported
3i Europe Partners IV
2003
3,000 EUR
Europe
95.8
190.0
7.0
1.97
27.0
23.0
2
31-Mar-14
3i Europe Partners V
2006
5,000 EUR
Europe
92.8
34.0
69.0
1.03
1.0
8.0
4
31-Mar-14
3i Japan Buyouts Fund
2000
20,000 JPY
Asia
30.0
163.8
0.0
1.64
32.8
18.4
2
30-Jun-14
3i UK Investment Partners
1996
415 GBP
Europe
96.8
139.0
1.0
1.40
8.1
17.2
3
31-Mar-14
3i UK Investment Partners II
1997
378 GBP
Europe
95.2
114.0
0.0
1.14
2.6
10.5
3
30-Jun-14
40|86 Advisors
Conseco Capital Partners II
1994
624 USD
North America
12.5
279.6
0.0
2.80
92.2
19.0
1
30-Jun-14
ABN AMRO Participaties
Fourth Causeway Development Capital Fund
1995
Europe
100.0
119.5
0.0
1.19
4.0
17.3
3
30-Jun-14
Second Causeway Development Capital Fund
1986
Europe
100.0
151.8
0.0
1.52
0.2
19.1
4
30-Jun-14
Third Causeway Development Capital
1990
60 GBP
Europe
100.0
143.0
0.0
1.43
9.0
18.9
4
30-Jun-14
ABRY I
1989
35 USD
North America
71.0
492.0
0.0
4.92
64.0
30.2
1
30-Jun-14
ABRY II
1995
250 USD
North America
100.0
332.8
12.6
3.45
47.3
16.1
1
30-Jun-13
ABRY III
1997
581 USD
North America
90.6
124.9
5.1
1.30
4.5
9.1
3
30-Jun-13
ABRY IV
2000
776 USD
North America
72.3
202.9
43.4
2.46
17.8
15.5
2
30-Jun-13
ABRY V
2005
950 USD
North America
91.6
170.7
30.6
2.01
17.6
10.3
1
31-Dec-13
ABRY VI
2008
1,350 USD
North America
86.0
101.4
66.5
1.68
17.7
14.8
2
31-Dec-13
ABRY VII
2011
1,600 USD
North America
71.6
0.0
117.4
1.17
12.2
10.0
2
31-Dec-13
ACA Group
ACA ICT I
2008
4,000 JPY
Asia
100.0
82.0
25.0
1.07
25.0
11.9
2
31-Mar-14
Accel-KKR
Accel - KKR Company
2000
250 USD
North America
100.0
175.2
43.5
2.19
7.9
15.5
3
31-Dec-13
ABRY Partners
Accel-KKR Capital Partners III
2008
600 USD
North America
86.0
46.9
79.8
1.27
11.7
14.8
3
30-Sep-13
Accel-KKR Capital Partners IV
2013
750 USD
North America
3.9
0.0
46.4
0.46
n/m
n/m
n/m
31-Dec-13
Accent Equity 2003
2003
250 EUR
Europe
99.0
142.0
24.0
1.66
30.0
23.0
2
31-Mar-14
Accent Equity 2008
2007
380 EUR
Europe
81.0
52.0
104.0
1.56
12.0
8.2
1
31-Mar-14
Accent Equity 2012
2012
3,800 SEK
Europe
16.0
0.0
104.0
1.04
n/m
n/m
n/m
31-Mar-14
ACI Capital
ACI Capital II
2006
335 USD
North America
68.5
0.0
21.1
0.21
-25.1
8.7
4
30-Sep-13
ACON Investments
ACON Equity Partners III
2012
751 USD
North America
51.7
0.0
74.8
0.75
n/m
n/m
n/m
31-Mar-14
ACON Latin America Opportunities Fund
2009
173 USD
Americas
92.9
94.0
145.0
2.39
15.0
13.5
1
31-Mar-14
Accent Equity Partners
ACON Latin America Opportunities Fund IV
2013
Actera Group
Actera Partners
2007
475 EUR
Actera Partners II
2012
1,073 USD
Europe
Activa Capital
Activa Capital Fund
2003
146 EUR
Europe
Activa Capital Fund II
2008
321 EUR
Europe
92.5
3.0
96.0
0.99
n/a
9.7
4
31-Dec-13
Advantage Partners
AP Cayman Partners II
2007
303 USD
Asia
58.4
39.2
24.1
0.63
-10.5
11.6
4
31-Dec-13
Advent International
Advent Central & Eastern Europe IV
2008
1,000 EUR
Europe
76.9
1.8
77.3
0.79
-8.4
9.7
4
31-Dec-13
Advent Global Private Equity II
1993
415 USD
North America
100.0
n/a
0.0
n/a
20.0
23.2
3
30-Jun-14
Advent Global Private Equity III
1997
1,000 USD
North America
100.0
n/a
1.6
n/a
8.9
9.1
3
31-Dec-13
Advent Global Private Equity IV
2001
1,500 USD
North America
87.2
283.2
2.9
2.86
40.3
24.3
1
31-Dec-13
Advent Global Private Equity IV-A
2002
456 USD
Europe
96.0
318.6
6.1
3.25
52.1
27.8
1
31-Dec-13
Advent Global Private Equity V
2005
2,500 EUR
Europe
99.0
214.0
31.6
2.46
50.3
10.5
1
31-Dec-13
Advent Global Private Equity VI
2008
6,600 EUR
Europe
98.9
50.5
120.0
1.71
21.1
9.7
1
31-Dec-13
13
Americas
1.7
0.0
0.0
0.00
n/m
n/m
n/m
31-Mar-14
Europe
108.1
41.9
114.4
1.56
15.6
8.2
1
31-Dec-13
29.8
0.0
85.8
0.86
n/m
n/m
n/m
31-Dec-13
92.4
157.0
8.0
1.65
17.0
23.0
3
31-Dec-13
© 2014 Preqin Ltd
2014 Preqin Private Equity
Performance Monitor
alternative assets. intelligent data.
The Preqin Private Equity Performance Monitor, now in its eleventh edition, features extensive analysis of private equity
returns. Find out which are the top performing funds and firms, and view net-to-LP returns for over 7,000 separate vehicles
of all types and geographies, including more than 1,200 private real estate funds.
This year’s expanded and fully updated edition includes:
•
Top performing funds and firms identified in extensive league tables by fund type and
vintage year.
•
Annual and quarterly changes in fund valuations.
The 2014
Preqin Private Equity Performance Monitor
•
Examination of risk vs. return for different fund types.
•
Benchmarks across different fund types by vintage year and geographic focus.
•
Dry powder and assets under management.
•
Detailed analysis sections examining key trends by fund type, size and region.
alternative assets. intelligent data
•
Private equity returns examined against public markets.
•
The performance of listed private equity.
www.preqin.com/pm
www
preqiin com//pm
Visit www.preqin.com/pm for more information
Completed Order
Forms:
Post (to Preqin):
New York
One Grand Central Place
60 E 42nd Street
Suite 630
New York
NY 10165
I would like to purchase the 2014 Preqin Private Equity Performance Monitor:
Single Copy:
Additional Copies:
Data Pack:







$795 + $40 Shipping
£465 + £10 Shipping
€550 + €25 Shipping
Tel: +65 6305 2200
Fax: +65 6491 5365
San Francisco
1700 Montgomery Street
Suite 134
San Francisco
CA 94111
€140 + €12 Shipping
Shipping Details:


Name:
Cheque enclosed (please make cheque payable to ‘Preqin’)
Charge my:




Visa
Firm:
Mastercard
Job Title:
Amex
Address:
Please invoice me
Card Number:
City:
Name on Card:
State:
Expiration Date:
Post/Zip:
Security Code:
Country:
Telephone:
Email:
Tel: +1 415 835 9455
Fax: +1 440 445 9595
Email:
[email protected]
Data Pack contains all underlying data
for charts and graphs contained in the
publication. Only available alongside
purchase of the publication.
Payment Details
Tel: +44 (0)20 7645 8888
Fax: +44 (0)87 0330 5892
Singapore
One Finlayson Green
#11-02
Singapore
049246
$300 / £175 / €185
£110 + £5 Shipping
Shipping costs will not exceed a
maximum of $60 / £15 / €37 per order
when all shipped to same address. If
shipped to multiple addresses then full
postage rates apply for additional copies.
Tel: +1 212 350 0100
Fax: +1 440 445 9595
London
Equitable House,
47 King William Street
London, EC4R 9AF
$180 + $20 Shipping
American Express, four digit
code printed on the front of
the card.
Visa and Mastercard, last
three digits printed on the
signature strip.