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PitchBook Analyst Note: Exploring Long-Dated PE Funds

Q2 2021

PitchBook Analyst Note: Exploring Long-Dated PE Funds

June 7, 2021

PitchBook Analyst Note: Exploring Long-Dated PE Funds
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Long-dated private equity funds with lifespans of 15 years or more have emerged over the past half-decade. Investors have multiple long-dated strategies to choose from, each with their own set of pros and cons, according to PitchBook's recent analyst note:
 
  • Core funds, offered by some of the largest PE firms, target companies with a lower risk/return profile than traditional PE funds, and compound growth over holding periods of 10 years or more. Other long-dated funds have emerged that target IRRs of 20% or more, and are more flexible in whether they will sell assets within a typical window of three to five years.
     
  • For long-dated funds, the most significant competition for assets comes from LP direct investors.
     
  • GP-led secondaries may also alter the competitive landscape for long-dated funds, since they allow traditional PE funds to act like long-dated funds