Private Equity Performance: What Do We Know?
Robert S. Harris
University of Virginia - Darden School of Business
University of Oxford - Said Business School; European Corporate Governance Institute (ECGI); University of Oxford - Said Business School
Steven N. Kaplan
University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER)
Journal of Finance, Forthcoming
Fama-Miller Working Paper
Chicago Booth Research Paper No. 11-44
Darden Business School Working Paper No. 1932316
We study the performance of nearly 1400 U.S. buyout and venture capital funds using a new dataset from Burgiss. We find better buyout fund performance than has previously been documented – performance consistently has exceeded that of public markets. Outperformance versus the S&P 500 averages 20% to 27% over a fund’s life and more than 3% annually. Venture capital funds outperformed public equities in the 1990s, but underperformed in the 2000s. Our conclusions are robust to various indices and risk controls. Performance in Cambridge Associates and Preqin is qualitatively similar to that in Burgiss, but is lower in Thomson Venture Economics.
Number of Pages in PDF File: 43
Keywords: Private Equity, Venture Capital
JEL Classification: G2, G11
Date posted: September 23, 2011 ; Last revised: July 30, 2013