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How liquidity constraints, extended holding periods, and elevated dry powder are shaping capital deployment, exit dynamics, and performance dispersion across private equity.
The State of Private Equity, Part 1: Concentration Driving a Narrow Recovery
Private Equity
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The State of Private Equity, Part 1

Returns: Divergence of Performance

Performance continues to tell a more nuanced story. Strong public-market returns have narrowed the historical 10-year outperformance of private equity relative to the S&P, though top-quartile funds still deliver IRRs above 20%.

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Historically, multiple expansion and cheap debt accounted for a significant portion of returns. Without those tailwinds, managers must increasingly rely on EBITDA growth and operational improvement to drive performance. Forward-looking estimates suggest median private equity returns of approximately 14% net of fees, supported by dispersion, control positions, and operational value creation.

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