Invest Europe

You Ask, We Answer #15: How are private equity valuations really made?

Videos

1:07

•

14 Nov 2025

Private equity and venture capital invest to transform companies that grow in value over time.

Tags:

You Ask, We Answer Videos

th_you-ask-we-answer-15-how-are-private-equity-valuations-really-made-14-nov-2025.jpg

It is the only way for PE, VC funds to generate net returns for their long-term investors.

Valuations are updated quarterly and reflect listed market movements, but with less volatility. Fund managers mark assets up or down carefully, using conservative assumptions. Every valuation is independently audited, and Invest Europe endorses the International Private Equity and Venture Capital Valuation (IPEV) Guidelines, the global standard also endorsed by 40 PE, VC professional bodies. The evidence? Listed private equity valuations, for example, are consistently conservative. Research shows direct listed PE exits achieved +39% uplift over last reported valuations, and funds of funds achieved +49%. This informed and prudent valuations model benefits millions of Europeans, from pensioners to policyholders, delivering long-term net returns rooted in real company performance.