U.S. private equity fund managers have had a fair measure of success lately. Last year, the median time it took a fund to close was 12.8 months, one of the shorter times on record, while over 87% of funds raised hit their target for the second year in a row.
General partners have been able to find success in large measure because of greater employment of niche and targeted strategies, as well as a greater focus on investor relations campaigns when courting limited partners. LPs have become more sophisticated, and choosy, shrinking the number of GPs to whom they commit. That, as well as the sheer sums of dry powder PE investors have yet to deploy, doubtless contributed to the surge in time between funds in 2015. So what does this mean for fundraising in the short term?