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Limited Partners

Key learnings from the 2018 Annual Institutional Investors Survey

We recently released the 2018 Annual Institutional Investors Survey, which draws on survey responses from 50+ allocators of capital.

We recently released the 2018 Annual Institutional Investors Survey, which draws on survey responses from 50+ allocators of capital. We wanted to get a pulse on their current sentiment around private market strategies as well as their plans for 2019 and beyond. Respondents range from sovereign wealth funds to family offices to public pensions. Read a quick summary of some key findings below.

Allocations

How do you anticipate your target allocation to the following asset classes or strategies changing in the next 24 months?

Respondents expect the average allocation for private market strategies to grow from 30.9% to 32.5%.


How do you expect your pace of capital calls for the following private markets strategies to change over the next 12 months?

Respondents anticipated the biggest spike in activity from private debt funds.


When managing your alternatives portfolio, how do you spend your time as a proportion of your workday?

Roughly three-quarters of LPs' time is spent sourcing and conducting due diligence on managers, as well as monitoring existing ones.

LP/GP relationships

Have you committed to a first-time fund?

Investors are largely willing to consider first-time funds


When considering a fund commitment, how important are the following factors? (Where 1 is least important and 6 is most important.)

Like many public market investors today, cost is the biggest concern for private market LPs, with management and performance fees, respectively, ranking highest on the list.

Access points

How do you source managers or deals?

A plurality of respondents rely solely on their in-house team and 90% employing an in-house team in some capacity.

Return expectations

Which return metrics do you use to evaluate your private market investments?

With only a few exceptions, LPs utilized multiple return metrics to assess the performance of their private market investments.


What are your long-term return (IRR) expectations for private market strategies?

VC garnered the loftiest return expectations with respondents expecting an average IRR of 19.8%.

Want to learn more about allocating capital in the private markets? Download our guide.

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