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2Q 2014


BENCHMARKING & FUND PERFORMANCE Housing crisis devastates mid-2000s PE real estate fund performance



CONTENTS 4 5 6 7 8 9 10-11 12 13 14 15 16 17 18 19



PE & VC KS PME Benchmarks KS PME Case Study: Healthcare

ADLE Y BOWDEN Senior Director, Analysis

Content, Design, Editing & Data ALLEN WAG NER Editor ALE X LYKKEN Senior Financial Writer

Global IRR by Fund Type

PETER FOG EL Senior Data Analyst ANDY WHITE Senior Data Analyst

Global Quartiles & Benchmarks

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Global Secondaries Fund Returns

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Global Real Estate Fund Returns

EDITORIAL [email protected] SALES

Global PE IRRs

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Global PE Fund Return Multiples U.S. PE Fund Cash Flows Global VC IRRs COVER IMAG E CREDIT

Global VC Fund Return Multiples U.S. VC Fund Cash Flows Select Top Funds by IRR Methodology

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3 P I TC H B O O K 2Q 2014 G LO B A L P E & VC B E N C H M A R K I N G & F U N D P E R FO R M A N C E R E P O R T

Introduction Previous versions of our Benchmarking Report One very interesting development is that net included mostly private equity (PE), venture cash flows from PE funds are on pace to hit record capital (VC), debt and fund-of-funds performance highs in 2013. Through 3Q 2013, PE firms have data and metrics; however, PitchBook carries fund distributed close to $200 billion back to their returns information on several other fund types. limited partners, while LPs have contributed $89 To that end, we have included sections on the real billion. This seems to show that investors have estate and secondaries asset classes, in addition to been taking advantage of high valuations and the the usual IRRs, quartiles, multiples public-market frenzy to exit their and cash flows for PE and VC portfolio companies. Net cash flows funds. As we did last quarter, this report Rather unsurprisingly, real estate opens with our PE and VC KS PME from PE funds are funds that closed in the middle of Benchmarks, which compare the on pace for record performance of specific vintages the decade have performed terribly, highs in 2013. with the median IRRs for 2005-2007 of each fund type with the public vintages all below 0%. But the asset markets. On page six, we take a look class has since recovered, with more at how healthcare-focused private recent vintages matching or nearing IRR levels seen equity funds have performed against the Russell in the early part of the last decade, when the housing 3000® Healthcare Index. bubble expanded in the U.S. For example, the 2010 We hope the information contained in this report and 2011 vint