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Private Equity Institutional Investor - Trends for 2015 Survey

Author: Probitas Partners
Date: December 2014

Overview of Survey Findings

The following summarizes the top-line findings from the survey:

  • Steady interest in private equity. Investors are focused on redeploying
    the large amounts of capital that have been returned to them over the
    last couple of years, freeing up their private equity allocations, though
    many of them are more focused on re-ups rather than increasing new fund
    manager relationships.
  • Continued focus on smaller buyout and growth capital funds. Investors
    remain focused on smaller and middle-market buyout and growth capital funds
    in the United States and Europe to diversify portfolios and commit capital to
    strategies where managers can prove recurring added value.
  •  . . . But many investors fear that purchase price multiples in these sectors are
    too high. Even as investors express interest in the sector, they are concerned
    that the high prices now being paid will drive down future returns.
  • Interest in emerging markets rebounded slightly as China came back into
    favor. The return of the IPO market in China has increased investor interest in
    China — though not to its previous highs of three or four years ago; political
    unrest or uncertainty in markets like Russia and Turkey muted interest in
    those geographies.
  • U.S. venture capital interest increased from last year’s low point. Increasing
    IPO activity caught investor attention, although the interest is mainly coming
    from North American investors; European and especially Asian investors
    remain unimpressed.
  • Investors are increasingly creating co-investment programs. Investors are
    increasingly targeting co-investments in an effort to enhance overall and net
    returns, and say that they are devoting the resources to create internal coinvestment
    programs; this is especially true of the largest investors.

Geography: Global

Type of study: Consulting research

Relevant for: All

Source: Probitas Partners