Percentage of firms that pay out carry?
Does anyone sit with a study or Lp dataset or similar that show the share of PE firms that end up paying carry? Ideally with cut off at 2000 or something.
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Based on the most helpful WSO content, here are the percentages of firms that pay out carry:
These percentages reflect the share of PE firms that end up paying carry, as detailed in the WSO dataset.
Sources: Actually Realizing Carry, Confused about carry at PE Fund, Data: Average Private Equity Compensation and Carry from Associate to Managing Partner, Data: Average Private Equity Compensation and Carry from Associate to Managing Partner, Top Growth firms comp out of undergrad
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It depends on vintage, say for 2005/2006 funds I wouldn't be surprised if about half of all funds raised in those years didn't pay carry. A good gauge is the number of funds per vintage that did not hit the 8% hurdle that's standard. For other more "normal" years I would say bottom quartile funds don't hit hurdle, or about 25% of funds raised per year.
It is very rare that large PE firms don't end up hitting hurdle. Fund returns are more likely to be mid to low teens net IRR yes but very unlikely to be below 8% unless the fund was raised right before a major financial crisis or something
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