Private equity’s perennial performance

Preliminary performance figures compiled by Thomson Financial in collaboration with the European Private Equity and Venture Capital Association (EVCA) were presented at the EVCA Investors’ Forum in Geneva yesterday and they show that despite the credit crunch, private equity buy-out returns hit a record high of 16.1% in 2007.

The performance figures relating to the private equity industry as a whole on a pooled average basis show an overall 11.7% return by the asset class, net of management fees and carried interest with venture capital returning 4.5%.

Within those broad buyout and venture capital bands it was the large and medium buyout funds that proved to be the best performers last year showing returns of 21.9% and 17.4% respectively. On the venture capital (VC) front, funds dedicated to development stage VC were the ones to watch, as funds specialising in that particular stage generated returns of 7.8%.