State of the Markets: The Rise of the Private Equity Industry
Bruce Lynn: Discussion Leader
According to a recent Financial Times article (May 2019) the number of companies owned by private equity firms (approx. 8,000) exceeds the number of public owned companies by about 2:1. Even more remarkable is that this growth has occurred in a relatively short period of time, the last 20 years.
This trend has not gone unnoticed by pension funds or other “accredited investors” that have been increasing their investments in well known (KKR, Blackstone, Carlye Group, etc.) and less well known firms among the 4,000 in the industry. According to a recent E & Y report investors have placed approx. 10% of their assets in the PE “asset class” which manages about 6 trillion of assets. Note: public companies are valued at 30trillion
As this growth has occurred, the recent WeWork debacle (i.e. PE owned company valued at 48BN fails to complete IPO even at a 9BN valuation) has brought into focus the ideas about “performance” or “ valuation” of private companies versus their more well-known public company “cousins”.
Join your peers at DMA to learn more about staying up to date on this industry, its risks and potential rewards
Readings:
Pitchbook_Ex-unicorn stocks are tanking in a post-WeWork world
Pitchbook_3Q_2019_US_PE_Breakdown
McKinsey_Private equity-markets-come-of-age-Private-Markets-Review-2019
ey-Private Equity_a-new-equilibrium-report