Private Equity Portfolio Companies: A First Look at Burgiss Holdings Data

Abstract

This paper provides a first look at newly available data on the holdings of private equity (PE) funds. Because research has been hampered by the lack of comprehensive, high-quality data on portfolio companies, this new source offers the potential for a wide range of research. Provided by Burgiss, a global provider of data and analytics to investors in PE funds (limited partner investors or LPs), the data are gathered from the financial reports of general partners (GPs) to LPs who are Burgiss clients. The sample covers over 45,000 investments in funds’ portfolio companies (in buyout and venture capital); moreover, the coverage is expected to grow through a phased release process. The paper describes preliminary findings on sample characteristics and offers a high-level view on aspects of performance in hopes of inspiring additional research. Returns to investments in portfolio companies are highly variable and skewed. This is particularly true of venture capital where many investments turn out worthless and average performance is boosted by a few spectacular successes that create the bulk of fund value. Performance is related to a number of factors (including investment size, duration of the investment and levels of fund raising), with patterns differing for buyout and venture capital investments.

Keywords: Private Equity, buyouts, venture capital, portfolio company

JEL Classification: G12