Private Capital Markets
Weekly Chart Spotlight
Our private markets observations based on the world’s largest private market data ecosystem of over 12,500k funds, 125,000k+ portfolio companies and 2,000,000 proprietary cash flows.
Our private markets observations based on the world’s largest private market data ecosystem of over 12,500k funds, 125,000k+ portfolio companies and 2,000,000 proprietary cash flows.
February 20, 2025
Market Dynamics in Private Capital: Analyzing Performance Trends During US Administrations
The private capital markets are shaped by various factors including economic policies, regulation, and taxation, which influence investor behavior and market trends. Historically, market-oriented strategies like deregulation and tax cuts have enhanced investor confidence, boosting activities like IPOs and mergers across industries such as energy, finance, and healthcare. For example, the 2017 Tax Cuts and Jobs Act lowered corporate tax rates, benefiting private equity firms by improving returns and reducing regulatory hurdles. The chart showcases the disparity in mean internal rates of return (IRR) between venture capital and real estate deals in 2020, with venture capital achieving a 46.93% mean IRR compared to real estate’s -33.24%, highlighting how different sectors are affected by factors like economic policies and global events. Conversely, policies focusing on broader economic protections lead to increased regulation and taxation, aimed at distributing market benefits more widely. Regulatory acts such as the Dodd-Frank Act of 2010 have posed challenges yet also created new opportunities by enhancing transparency and facilitating crowdfunding. Understanding these varied approaches allows investors to strategically navigate the complexities of private capital markets and optimize their strategies amidst changing economic conditions.
February 13, 2025
Growth of the Private Debt Markets: A 2025 Outlook
As we move into 2025, private debt markets are positioned for growth, bolstered by favorable economic conditions and innovative financing approaches. With declining U.S. interest rates, private debt provides companies with flexible capital and fuels leveraged buyouts, which in 2023 made up 86% of all LBO loans. Institutional investors seeking stable, risk-adjusted returns drive the market, maintaining a preference for senior debt due to its post-2008 crisis stability. The complex nature of private debt, with strategies like sponsored deals and distressed investments, highlights its potential. Globally, the market is set to expand, particularly in Europe and Asia, driven by innovative fund structures and adaptive regulations. Private debt funds are capitalizing on rising corporate leverage and distressed assets, with general partners taking a more active role in managing investments for optimized returns.
February 6, 2025
Insights into Sector Dynamics for Pension Fund Investment Strategies
As we strive for long-term stability in pension fund portfolios, understanding the shifting landscape of private equity investments becomes crucial. The chart highlights the dynamic nature of US PE-backed enterprise values by sector, showing the volatile journey of different industries in recent years. The tech sector's enduring prominence since the Global Financial Crisis (GFC) underscores its vital role in diversification strategies. The transient swell of the consumer sector during the COVID-19 pandemic, followed by its post-2021 contraction, serves as a lesson in the potential volatility of market adaptations. Meanwhile, healthcare's post-COVID normalcy and the recent surge in financial services in 2023 offer intriguing opportunities and risks. Leveraging advanced portfolio management software to analyze these sectoral trends provides us with unparalleled insights, empowering pension funds to balance their long-term liabilities, optimize risk-return profiles, and maintain the necessary transparency amidst evolving markets. As these trends unfold, it’s imperative that we remain agile and proactive in harnessing sector strengths for sustainable growth and stability.
January 23, 2025
Understanding the Lifecycle of Contributions in Buyout Funds
Our journey through private equity management continues as we explore the intricacies of contribution patterns, particularly for buyout funds. The chart offers an insightful visualization of how these contributions tend to evolve throughout a typical fund lifecycle. In Year 1, there is often a concentration of contributions, with some funds reaching over 40%, underscoring a significant initial capital requirement. As investments mature, these contributions taper off, demonstrating a predictable decline pattern in subsequent years. This observed trend emphasizes the importance of private equity cash flow pacing, enabling institutional LPs to prepare meticulously for these early capital outlays. Such proactive management ensures LPs are well-equipped to meet initial commitments without strain, thereby facilitating smoother cash flow and optimizing overall investment efficiency.
January 16, 2025
Unlocking the Key to Seamless Cash Flow Management in Private Equity
In the dynamic world of private equity investment, effective liquidity planning becomes an essential skill for institutional LPs. Our first focus is on understanding the expected cash flows over time. As illustrated in the chart below, both contributions and distributions are charted across multi-year investment horizons, revealing significant fluctuations that underscore the unpredictable nature of capital commitments and returns. From 2022 to 2025, notable spikes in distributions, particularly in 2023 with a peak at 351.8 million USD, highlight why precise management of these flows is crucial. By leveraging private equity cash flow pacing, institutional LPs can anticipate these financial ebbs and flows, strategically managing their cash reserves to ensure a buffer is in place. This approach mitigates the disruptions in operational cash flow, providing a stable financial environment even amidst market volatility.
December 12, 2024
Bridging the Gap: Empowering Investment Decisions with Secure Data Sharing
Building on the need for transparent and detailed insights, secure data-sharing platforms have become indispensable tools for both General Partners (GPs) and Limited Partners (LPs). These platforms enable GPs to maintain control over their data, providing LPs with access to granular metrics, such as cash flows, portfolio company operating data, and fund performance details. This empowers stakeholders to assess portfolio health, benchmark performance, and identify trends with confidence. By ensuring data accuracy and maintaining confidentiality, such systems help mitigate risks and enhance responsiveness to market shifts. This collaborative approach fosters stronger relationships between GPs and LPs, ensuring informed strategies and more stable, predictable investment outcomes in an ever-evolving market landscape.
December 5, 2024
Why Data Transparency is Essential for Real Estate Investors in Today's Market
In today’s real estate market, real-time, granular data is key to making informed decisions. Investors with access to detailed metrics like occupancy rates and rental income were able to anticipate market trends and adjust strategies before the fallout from Covid and interest rate hikes. In contrast, those relying on delayed GP reports often found it too late to act. Data-driven platforms that provide transparent, deal-level insights empower both GPs and LPs to assess risk, track performance, and make proactive decisions, leading to more resilient returns.
November 21, 2024
Unlocking Value in Private Markets: The Power of Granular Data
In today’s uncertain economic and political landscape, accurate, detailed investment data is no longer a luxury—it’s a necessity. For private market investors, the stakes are high. While transparency has improved over time, a critical gap still exists, leaving many institutional investors at risk of suboptimal decisions and inefficiencies. Granular “look-through” data, rooted in cash flows and operating metrics, empowers investors with unparalleled insights. It provides a full picture of portfolio health, risk exposure, and emerging opportunities, going far beyond traditional GP-reported metrics like IRR. By leveraging this data, investors can conduct deeper due diligence, identify risks early, and optimize their portfolios to achieve superior outcomes. The message is clear: in private markets, knowledge truly is power, and high-quality data is the key to unlocking it.
November 14, 2024
Impact of Federal Funds Rate on Buyout Default Rates
The federal funds rate has a clear impact on buyout default rates, with higher interest rates historically correlating to higher defaults. For instance, in 2000, a peak interest rate of 7.03% saw buyout defaults hit 40.46%, while near-zero rates from 2009 to 2015 corresponded to significantly lower default rates. In 2022, as rates surged, buyout defaults reached their highest levels in over two decades. Looking forward, potential rate cuts could reduce default rates and spark renewed deal activity as capital costs decrease. However, broader economic and sector-specific factors remain critical. Investors who diversify and consider these dynamics are more likely to navigate market shifts successfully.
November 7, 2024
Impact of Interest Rates: Federal Funds Rate & Industrial Deal Growth
As the Federal Reserve shifts from a rapid rate hike cycle to potential cuts in 2024, private market investors must reconsider their strategies. Historical data from CEPRES shows that changes in the federal funds rate significantly impact the growth of private equity-backed industrial deals. Interestingly, while lower rates often lead to higher EBITDA growth, industrial companies can still thrive even as rates increase. For example, in the early 2000s, EBITDA growth for PE-backed industrial firms rose as rates declined, but this relationship changed in the mid-2000s, with both rates and EBITDA growth rising together. Understanding these dynamics will empower investors to navigate rate shifts effectively.
October 31, 2024
Private Credit Outlook Amid Refinancing and Sector Risks
As interest rates drive deal flow, refinancing stress emerges as a key concern across sectors. Borrowers who secured favorable financing during the low-rate period of 2020-2021 may now struggle to refinance, increasing the risk of defaults, especially within the healthcare sector, where private debt defaults have already spiked from 2019 to 2022. For investors, understanding these sector-specific risks is crucial in today’s complex market. Meanwhile, private credit remains an attractive asset class due to its competitive risk-adjusted returns, especially when compared to the heightened volatility of growth and buyout equity. Its seniority in the capital stack makes private credit particularly appealing to institutional investors seeking stability. Looking ahead, the asset class is well-positioned for growth through 2025, driven by steady demand and a robust pipeline, even as interest rate cuts might temper returns.
October 24, 2024
Investor Trends Driving Growth in Private Credit Market Post-GFC
Institutional investors, such as pension funds and insurance companies, continue to drive growth in the private credit market due to their focus on stable, risk-adjusted returns. Senior debt has dominated the capital structure of private credit deals since 2011, reflecting a preference for security and priority in repayment. The rising demand from these investors has fueled a surge in private credit fundraising, with new funds consistently launching to meet this growing appetite. As private credit continues to expand post-GFC, the market remains strong, supported by sustained investor interest and deal flow.
October 17, 2024
Private Credit Outlook 2024: Opportunities and Resilience Amid Rate Cuts
As we enter Q4 2024 with a recent 50 basis point rate cut, the private credit landscape presents a mixed yet optimistic outlook. While lower rates may slightly reduce returns by decreasing the risk-free rate, they also create a surge in deal flow as borrowers look to refinance. This trend could continue with anticipated rate cuts in 2025, potentially increasing the volume of private credit transactions while moderating returns. Historically, private credit has shown resilience during market stress, outperforming median IRRs significantly. From 2000-2024, top quartile private debt funds achieved IRRs of 22%, showcasing their ability to deliver equity-like returns with lower risk. Moreover, private credit thrives in low liquidity environments, making it an attractive option for institutional investors seeking higher yields in today’s economic climate.
October 10, 2024
Navigating the Future of Infrastructure Investing - Part II
Analyzing deal size and leverage offers critical insights into the dynamics of private equity investments within the construction industry. Larger deals often necessitate increased leverage, which can heighten risk and potentially lead to lower returns. With factors like population growth, urbanization, and substantial infrastructure investments propelling the North American construction sector, private equity firms are likely to maintain a strong focus on this area in the near future. However, it's crucial for investors to thoughtfully evaluate the specific sub-sectors and deal sizes they pursue, alongside effective risk management strategies, to ensure they achieve optimal returns in this evolving market landscape.
October 3, 2024
Navigating the Future of Infrastructure Investing
Infrastructure investing is evolving amid increasing market volatility and the demand for sustainable, resilient solutions. Traditional strategies are no longer sufficient, especially after the Covid-19 pandemic intensified supply chain disruptions and accelerated technological changes. Investors now face the dual challenge of making informed capital allocation decisions while managing rising risks and identifying sectors with reliable returns. Essential infrastructure, including transportation and energy, requires stable regulations and advanced data analytics to support sound investments. As private equity investors navigate this transformed landscape, the emphasis on strategic, data-driven decisions is crucial. Additionally, rising construction spending linked to population growth and urbanization is driving interest in infrastructure secondaries, which offer liquidity and diversification in uncertain economic conditions.
September 26, 2024
Navigating the Changing Real Estate Market
In today's dynamic real estate market, fluctuating interest rates, shifting demand, and rising sustainability pressures are reshaping the landscape. Investors must move beyond intuition, adopting data-driven strategies to thrive. As logistics, multifamily housing, and data centers gain momentum, traditional retail and office spaces face uncertainty. To drive growth, investors need advanced tools to analyze market trends, identify opportunities, and manage risks, especially with ESG considerations taking center stage. In this evolving sector, success demands granular data for informed decisions, considering local markets, regulations, and economic factors—essential for unlocking long-term returns and mitigating risks.
September 18, 2024
Thriving in a Booming Buyout and Growth Market
The buyout and growth sector of private equity is experiencing a remarkable surge, fueled by an influx of new capital and substantial dry powder ready for deployment. Investors are drawn to the potential for high returns, yet they must navigate increased competition and market volatility. To thrive, they are employing a mix of traditional buyouts and innovative growth strategies. The sector's continued success hinges on a steady capital flow, alignment with evolving market trends, and enhanced risk management. Managing risk remains a significant challenge, especially with concerns about illiquidity and the pressure to deploy capital swiftly. In this environment, data-driven decision-making and strategic precision are more critical than ever.
September 12, 2024
Today's venture capital landscape
In today’s rapidly evolving venture capital landscape, breakthrough technologies and disruptive startups are attracting significant investor interest. With a variety of funds, from blended to tech-specific, catering to diverse investment strategies, the sector offers immense potential. However, one critical challenge persists: the lack of transparency and reliable, granular data from venture capitalists. This opacity makes it difficult for investors to assess risks and identify promising opportunities accurately. As technology—particularly AI and cybersecurity—continues to reshape the sector, the need for real-time, detailed data is more pressing than ever. To thrive in this dynamic environment, investors must prioritize deeper data insights to make informed decisions and unlock the true potential of their investments.
August 29, 2024
Maintaining a Strategic Asset Allocation with Private Markets
Managing strategic asset allocation in private markets presents challenges due to unpredictable future capital calls and distributions, complicating cash flow and liquidity management. Diverse market conditions can also affect the Net Asset Value (NAV), which is often determined by a manager's judgment or third-party valuations that may not reflect current market realities. Additionally, market conditions can vary across asset classes, with the performance of one class potentially influencing others. To stabilize NAV, investors need accurate models that consider the specific cash flows, liquidity requirements, and risk tolerance unique to private markets.
August 22, 2024
Market Headwinds Challenge LPs' Cash Pacing - Part II
The slowdown in distributions affects the J-curve breakeven for PE funds. The J-curve represents the return pattern PE firms encounter early in a fund’s life cycle. Initially, investments lead to short-term negative returns due to expenses. As investments mature, positive returns emerge, and the J-curve turns upward. The breakeven point occurs when the fund’s net asset value matches investor commitments. Put simply, funds are returning cash later and many of the cash pacing models deployed by many LPs, either internal or third-party, are unable to accommodate such changes. Many LPs overcommit to funds in order to offset distributions later in the fund’s life and maintain their allocation. With the J-curve breakeven now later than models might predict based on historical patterns, managing private market exposure is harder for LPs – and portfolios run the risk of getting out of balance.
August 15, 2024
Market Headwinds Challenge LPs' Cash Pacing
The market environment has significantly changed in recent years, with higher interest rates increasing borrowing costs and reducing the potential returns from debt-heavy investments. Although valuations are rising, the higher rates also lower potential exit values, as buyers now discount future cash flows more heavily. This, along with the negative impact of recent macroeconomic shocks, has dampened market sentiment, particularly with IPOs remaining scarce. As exits and realizations slow, distributions to LPs have decreased, making it harder for GPs to raise funds. The broader macro environment remains volatile, with geopolitical tensions and economic uncertainty adding to the risks that LPs must navigate.
August 08, 2024
Determining Portfolio Fit
Portfolio fit analysis evaluates whether a fund aligns with an LP's current portfolio and aids in meeting their objectives. It involves comparing the alpha outperformance and beta risk of the existing portfolio with the GP's track record. By plotting fund- or deal-level returns against public market equivalent indices, LPs can quantify the alpha and beta risk correlation for relevant public and private asset classes. This analysis helps to identify potential weaknesses and predict how the portfolio may perform in various market scenarios. By overlaying this data with the alpha/beta analysis of the GP's track record, LPs can determine if the GP's strategy is suitable for their portfolio and will help achieve their targets. For example, in the chart above a GP with an alpha of 21.2% IRR and a negative beta of -0.49 compared to the S&P 500 indicates outperformance with a strategy that tends to perform better in bearish markets and a weak macroeconomy.
August 01, 2024
Deal Level Due Diligence: Operating Margins and Value Creation
A key sign of a portfolio company’s appeal is the change in its operating margin. By comparing margins at the start and end of an investment, LPs can see if GPs have added value. The chart above shows how LPs can pinpoint factors like revenue growth, margin expansion, and multiple expansion that drive enterprise value growth. Institutional LPs often need to perform these due diligence checks due to rising regulatory demands and to safeguard investment managers. This process creates an audit trail, proving that LPs have fulfilled their due diligence responsibilities.
July 23, 2024
Deal Level Due Diligence: Operational Analysis
The chart above shows that in 2008, total debt rose further due to costly mezzanine financing, at the expense of equity. During the 2009-2011 financial crisis, new investments had higher equity ratios. More recently, investments have become more aggressive with increased leverage. Reviewing operational growth reveals whether a GP can increase sales and EBITDA through active management. Comparing financing structure with operational growth helps assess the attractiveness and health of portfolio companies. Analyzing EBITDA is crucial for mature companies funded through buyouts or growth equity: increases in EBITDA lead to higher exit valuations and investment income.
July 12, 2024
Deal Level Due Diligence: Scrutinizing Risk and Return
This week's chart displays the total value to paid in capital (TVPI) performance attribution from an example manager. This visualization of distribution can serve as a health check for the portfolio. A large proportion of deals have TVPIs greater than 1.0, which indicates that many investments are at least returning the initial capital invested, which is a positive sign. Conversely, 7 deals in this example manager have TVPIs less than 1.0, which reflects underperformance. Evaluating this, alongside other performance measures, such as pooled and capital weighted means, and additional metrics like internal rate of return (IRR) and distributions to paid in capital, should be done to fully understand a GP’s deal level return profile.
July 4, 2024
Fund Level Due Diligence: Differentiating Between Opportunities
The J-curve chart depicts a fund’s historical and expected liquidity, illustrating the manager's ability to manage assets and cash flow through different market phases. It reveals actual investment returns and risks by comparing portfolio company cash flows with net investor cash flows, accounting for fees, expenses, and carried interest. Since general partners can influence these factors, it's crucial for limited partners to distinguish between returns from asset performance and those from financial maneuvers.
June 27, 2024
US Tech Deal Spotlight
(1) Post-GFC (Global Financial Crisis), tech deals have shown a clear division between winners and losers. (2) The period from 2009 to 2022 experienced significant pricing multiple expansion due to a favorable monetary environment. (3) Tech deals made in 2021 stand out for showing the weakest returns, reflecting potential overvaluation or adverse market conditions at that time. (4) However, more recently, there has been a noticeable drop in deal pricing. This adjustment in pricing, coupled with a rebound in returns, suggests a correction in the market and is interpreted as a positive sign, potentially indicating more sustainable and realistic valuation levels going forward.
June 20, 2024
US PE-backed Company Revenue CAGR by Investment Year
The chart illustrates a trend of (1) increasing average revenue growth for private equity (PE)-backed companies, starting from the aftermath of the Global Financial Crisis (GFC). This upward trajectory highlights a steady improvement in revenue growth rates over the years. (2) A significant acceleration in revenue growth is observed from 2016 onwards, culminating in a peak in 2020, where the compound growth rate surpassed 50%. (3) Despite a decline in growth rates for deals made in subsequent years, these rates continue to be robust and historically strong. This suggests that while the peak growth witnessed in 2020 has not been maintained, PE-backed companies are still experiencing healthy revenue growth in recent years.
June 13, 2024
US PE pricing multiples by sector
The chart illustrates several significant trends in deal pricing across different sectors over time, highlighting the effects of major economic events and shifts. (1) In the consumer sector, prices remained stable for 15 years but peaked during the COVID-19 pandemic, only to revert to levels from a decade prior. (2) The healthcare sector, consistently popular, saw a post-COVID surge in deal prices, which quickly fell back to pre-pandemic levels. (3) In the tech sector, pre-GFC pricing was viewed as unsustainable, a concern that proved accurate during the financial crisis. (4) Post-GFC, a benign credit environment coupled with a substantial increase in money supply led to inflation in deal prices across all sectors.
June 7, 2024
US deal default rates by stage
The chart illustrates that (1) venture capital (VC) defaults peaked in 2009 following the Global Financial Crisis (GFC). (2) During the GFC, default rates for VC, buyout, and growth deals converged. (3) By 2009, defaults had returned to normal levels, with VC defaults at 45% and buyout/growth deals at 20%. (4) A general trend of decreasing defaults continued through 2020. (5) However, the onset of the COVID-19 pandemic led to a significant reversal, with default rates surging back to crisis levels. This suggests that while the financial markets had stabilized post-GFC, they were still vulnerable to large-scale disruptions such as the pandemic.
May 30, 2024
US private equity performance by stage
The chart highlights the performance trends of different investment strategies post-Global Financial Crisis (GFC). (1) Venture capital (VC) saw unprecedented returns for deals made in 2012, but these returns have declined since then. (2) Growth deals rebounded significantly in 2010 but have displayed more volatility compared to other strategies. (3) Buyouts were somewhat impacted by the GFC and have shown a muted recovery. (4) All strategies have followed a negative trajectory since 2017. Overall, the GFC created a favorable environment for deals, with Growth and Venture strategies benefiting the most.
May 23, 2024
US private equity deal performance and pricing
The chart illustrates the post-Global Financial Crisis (GFC) landscape with a swift V-shaped rebound in pricing after an initial dip (1), reaching unprecedented levels by 2022 (2) before softening in 2023. Despite this, (3) subsequent deals continued to yield exceptional money multiples returns, indicating resilience in investment profitability. However, (4) an overall downward trend in pricing, interspersed with occasional recoveries, alongside a general decline in returns over the analyzed period, suggests market volatility and challenges for investors amidst changing economic conditions. The chart underscores the importance of navigating the evolving financial landscape with adaptability and strategic decision-making to capitalize on opportunities while managing risks effectively.
May 16, 2024
Deal IRR by Total Debt/EBITDA
This analysis highlights the vital role of cash flow data in private market investments, offering insights into real returns, risk assessment, liquidity management, and performance evaluation. By focusing on deal cash flow data and operational metrics rather than leverage, investors gain clarity on wealth impact and can monitor portfolio company health, anticipate liquidity needs, and evaluate fund performance against objectives. Additionally, it enables flexible and thorough analysis at various levels, emphasizing the importance of cash flow data in informing investment decisions and optimizing performance in private markets.
May 6, 2024
Real Estate Funds Portfolio - Occupancy rate vs Net Operating Income
By analyzing historical trends and operational metrics, investors can forecast future performance and identify areas for improvement within portfolio companies. Access to accurate quarterly data, particularly in sectors like commercial real estate, empowers investors to anticipate market shifts and adjust investment strategies accordingly, mitigating risks and maximizing returns. This proactive approach contrasts with relying solely on General Partner reports, which may lead to missed opportunities and late reactions to market changes.
April 26, 2024
Debt Pricing by Deal Tranche Class by Percentage
Debt tranches are typically categorized based on their priority of repayment and associated risk levels. The pricing of each tranche class by percentage reveals the market's perception of the risk associated with each tranche. As noted within the chart, higher-priced tranches typically represent higher-risk positions, while lower-priced tranches indicate lower risk. For example, the higher interest rates associated with mezzanine debt reflect its increased risk compared to senior debt, including subordination, lack of collateral, hybrid nature, and higher leverage levels. These factors contribute to the pricing of mezzanine debt and help compensate lenders for the additional risk they assume.
April 19, 2024
Deal Default Analysis by Investment Year
Embarking on a journey through time, the Deal Default Analysis chart serves as our compass, guiding investors through the peaks and valleys of investment risk. Reflecting the percentage of deals defaulted over time, calculated from the total number of deals with a TVPI less than 1, this tool aids in assessing investment risk. Clear spikes in 2007/2008, 2019, and 2022 signal challenging economic and market conditions, reminiscent of the Global Financial Crisis and subsequent tumultuous periods. In navigating these turbulent waters, understanding risk is paramount for investors seeking safe harbors amidst uncertainty.
April 11, 2024
Financing Structure at Entry by Investment Year (Median)
The Financing Structure at Entry by Investment Year (Median) chart serves as a critical gauge for finance professionals, offering a comprehensive view of a company's financial dynamics over time. By analyzing the distribution of equity and debt at the point of investment across different years, investors gain valuable insights into the company's debt management strategies, its capacity for financial agility, and its overall financial robustness. This metric enables investors to assess the company's ability to navigate debt levels effectively, maintain flexibility in capital allocation, and sustain its financial health throughout its growth trajectory, thereby informing investment decisions and risk management strategies with a deeper understanding of the company's financial landscape.
April 4, 2024
US Deal Default rates by stage 2005-2023
In the wake of the 2008 Global Financial Crisis (GFC), venture capital defaults surged to a peak in 2009 (1), marking a turbulent era for investors. However, post-crisis, a semblance of stability emerged as defaults converged (2), offering a glimpse of recovery. By 2009, default rates for VC and Growth deals normalized to 45% and 20% respectively, signaling a return to equilibrium amidst ongoing efforts to mitigate risks. A steady decline in defaults ensued, guiding the industry towards resilience. Yet, the onset of the COVID-19 pandemic in 2020 unleashed a fresh wave of uncertainty, pushing defaults back to crisis levels (3). As financial professionals navigate these stormy waters, the tale of VC defaults underscores the cyclical nature of the market and the imperative of adaptive strategies in times of crisis.
March 26, 2024
TVPI & Revenue CAGR vs EV/EBITDA 2005-2023
The Great Financial Crisis (GFC) brought a sharp pricing dip, swiftly followed by a V-shaped recovery (1). Subsequent deals delivered outstanding returns and stable revenue growth (2). In 2019, revenues surged, peaking in 2020 (3). However, from 2020 to 2022, pricing reached unprecedented levels while money multiples dipped, alongside a downward trend in revenue CAGR (4). Amidst these fluctuations, the financial sector's resilience and adaptability endured, navigating through the complexities of the economic landscape.
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Download our comprehensive guide today to discover strategic approaches for securing private market investments amidst 2025's financial challenges. Equip your insurance company with the tools to navigate regulatory demands, mitigate risks, and maximize returns in a volatile market environment.
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Download our whitepaper to gain deeper insights into how these tools can transform your portfolio strategy.
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Download our comprehensive guide today to discover strategic approaches for securing private market investments amidst 2025's financial challenges. Equip your insurance company with the tools to navigate regulatory demands, mitigate risks, and maximize returns in a volatile market environment.
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With private market assets under management expected to surpass $15 trillion globally by 2025, the sector is poised for another dynamic year. For professionals navigating private equity, venture capital, and other alternative assets, staying ahead of emerging trends will be crucial to maintaining a competitive edge. Understanding key shifts in technology, regulation, and market dynamics will be vital for making informed decisions and seizing new opportunities.
In this whitepaper, we will explore the top trends shaping the private markets in 2025, including the rise of AI, the expansion of private wealth, the growth of private debt, the influence of U.S. political leadership, and the increasing importance of data-driven decision-making.
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Download our whitepaper to gain deeper insights into how these tools can transform your portfolio strategy.