PitchBook Publishes Benchmarking and Fund Performance Report
August 13, 2013
PitchBook has released its quarterly Private Equity and Venture Capital Benchmarking & Fund Performance Report. Powered by the PitchBook Platform and sponsored by RR Donnelley, this report examines more than a decade of global PE and VC fund performance. Several metrics are featured in this report, including IRRs, fund return multiples, fund cash flows and PitchBook’s NAV Index. We've also added a new performance metric known as Public Market Equivalents (PME). Using indices from Russell Investments to develop PME vehicles, the report compares the relative performance of alternative asset classes against public equities.
Some highlights include:
• PE funds have generated annual returns about 3x greater than those produced by the public markets over the last twelve years
• Despite trailing the public markets, returns for both PE and VC have been relatively strong; since 2009, the CAGR is 9.6% for PE funds and 7.4% for VC funds
• Private equity funds notched an 11.1% return in 2012, while VC funds trailed with a 4.5% return
• Identifying top quartile managers is significantly more important in venture than in private equity