Where will PE be in 2 years?
With private equity funds slowly returning less capital to LPs, valuations for deals remaining high, and almost all firms using credit facilities to juice returns, will private equity be as attractive an asset class as it once was? Will there be too many players bidding on deals for there to be any value to be created?
Any and all thoughts welcome.
As an asset class it still outperforms everything else, and I don't see that changing.
you realize average fund life is 7-10 years? so 2 years ... nothing
On that note, they will continue to rake in massive management fees to sustain themselves and continue to point to one off really good deals to raise more capital then lock it up.
2019
I don't see it making it past 2020.
ST it'll be fine, but if interest rates keep increasing they're gonna get screwed. Even right now, 25-30% of capital in PE funds is uninvested
25-30% of capital un-invested is typical though. That's how funds are set up, you raise money and it take 5 to 6 years to invest it, you run out and raise another fund.
Interest rates have been much much higher historically, and returns were better than they are now...
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