The Latest Global Private Equity Industry Statistics Explained
As of 2021, global private equity assets under management (AUM) reached a record $7.4 trillion.
The statistic provided indicates that by the year 2021, the total value of private equity assets being managed globally had reached an all-time high of $7.4 trillion. Private equity assets under management represent the collective value of investments in privately-held companies or assets that are managed by private equity firms on behalf of their investors. The increase in the AUM to $7.4 trillion suggests a growing interest in private equity as an investment option, driven by factors such as potential higher returns compared to traditional investments, diversification benefits, and access to specialized expertise in areas such as mergers and acquisitions or operational improvements within portfolio companies. This record figure reflects the significant role that private equity plays in the global financial landscape and underscores the continued attractiveness of private equity investments for institutional and individual investors seeking to maximize their returns.
Private equity deals in 2020 were worth $592 billion globally, falling by 10% as compared to the previous year’s value.
The statistic indicates that the total value of private equity deals globally in 2020 amounted to $592 billion, representing a 10% decrease from the previous year’s total. This decline suggests a slowdown in private equity activity possibly due to the global economic uncertainty and challenges posed by the COVID-19 pandemic. The reduced value of private equity deals could be attributed to factors such as decreased investor confidence, disruptions in financial markets, and difficulties in conducting due diligence and completing transactions in a remote working environment. However, private equity remains a significant component of the global financial landscape, and the decrease in deal value in 2020 may reflect a temporary setback rather than a long-term trend.
As of 2020, there were over 7,000 private equity firms across the globe.
The statistic “As of 2020, there were over 7,000 private equity firms across the globe” indicates the significant presence and growth of the private equity industry. Private equity firms play a crucial role in the global economy by providing capital to privately-held companies in exchange for ownership stakes. The large number of firms suggests a competitive landscape in the industry, catering to various investment preferences and opportunities. This statistic also highlights the attractiveness of private equity as an investment asset class, drawing interest from investors seeking potentially high returns through strategic investments in businesses. The sheer quantity of firms globally underscores the widespread impact and influence of private equity in shaping economic growth and development.
In 2020, private equity firms spent more than $400 billion on company buyouts.
In 2020, private equity firms collectively invested over $400 billion in acquiring companies through buyouts, making it a substantial year for private equity activity. This statistic highlights the significant role that private equity plays in the global economy, with firms strategically acquiring businesses with the aim of driving growth, improving efficiency, and ultimately maximizing returns for their investors. The large amount of capital deployed in buyouts also reflects the confidence that private equity investors have in their ability to identify and capitalize on attractive investment opportunities, even amidst economic uncertainties.
North America accounted for 54% of all private equity investments globally in 2020.
The statistic indicates that North America was responsible for over half (54%) of all private equity investments made worldwide in 2020, signaling a significant concentration of private equity activity in the region. This suggests that a substantial portion of global private equity capital flows and investments were directed towards companies based in North America or operating within the North American markets. The dominance of North America in private equity investments highlights the region’s attractiveness to investors, potentially due to factors such as a large and diverse market, robust regulatory environment, and a thriving entrepreneurial ecosystem. This statistic underscores the importance of North America as a key player in the global private equity landscape in 2020.
63% of private equity deals done in 2020 involved technology companies.
The statistic “63% of private equity deals done in 2020 involved technology companies” indicates that a significant portion of private equity investments in 2020 were focused on technology firms. This suggests a strong interest and confidence in the technology sector among private equity investors during that year. Companies in the technology industry likely presented attractive investment opportunities, potentially due to their growth potential, innovation, and resilience in the face of economic uncertainties brought on by the global pandemic. The statistic implies that private equity firms saw value in technology companies as promising assets for generating returns and driving growth during a challenging economic environment.
Global private equity buyout deal volume declined by 16% in 2020 due to the effects of the pandemic.
The statistic indicates that the total value of global private equity buyout deals decreased by 16% in 2020 compared to the previous year. This decline can be attributed to the impact of the COVID-19 pandemic, which resulted in economic uncertainty, market volatility, and disruptions to business operations. Many companies postponed or canceled buyout deals as they focused on navigating the challenges brought about by the pandemic, such as supply chain disruptions, declining consumer demand, and financial instability. The decrease in buyout deal volume reflects the cautious approach of investors during a period of heightened uncertainty and highlights the broader economic repercussions of the global health crisis on the private equity industry.
The healthcare sector globally accounted for 18.5% of total private equity investment in 2020.
The statistic “The healthcare sector globally accounted for 18.5% of total private equity investment in 2020” indicates that nearly one-fifth of all private equity investments made worldwide in 2020 went into the healthcare sector. This substantial allocation underscores the significance of healthcare as an attractive investment opportunity, likely fueled by factors such as the ongoing COVID-19 pandemic, technological advancements, demographic shifts, and increasing healthcare spending globally. Private equity investors are drawn to the healthcare sector due to its potential for growth, innovation, and resilience, making it a key area of focus for investment strategies in light of its critical role in society and potential for financial returns.
Asia Pacific private equity deal value rose to $169 billion in 2020, up 19% from 2019.
In 2020, the total value of private equity deals in the Asia Pacific region increased to $169 billion, marking a significant rise of 19% compared to the previous year. This statistic indicates a strong and resilient private equity market in the region despite the challenges posed by the global pandemic. The increase in deal value suggests that investors and businesses in the Asia Pacific region continued to actively pursue investment opportunities and transactions, highlighting a sense of confidence and optimism in the private equity sector.
In 2020, ESG (Environmental, Social, and Corporate Governance) factors became major considerations in private equity with 85% firms embracing ESG principles.
The statistic highlights a significant shift in the private equity industry in 2020, where Environmental, Social, and Corporate Governance (ESG) factors emerged as prominent considerations for firms. The fact that 85% of private equity firms embraced ESG principles demonstrates a widespread recognition of the importance of sustainable and responsible investing practices. This shift signifies a move towards integrating ethical, social, and environmental considerations into investment decisions, indicating a broader trend towards responsible investing within the private equity sector. By prioritizing ESG factors, firms can align their investment strategies with long-term sustainability goals, potentially improving financial performance while also benefiting society and the environment.
The annualized private equity return over 10 years for public pension funds ended June 2020 was 9.57%.
The annualized private equity return of 9.57% over a 10-year period ending in June 2020 reflects the average annual rate of return earned by public pension funds from their investments in private equity assets during that time frame. This statistic indicates that, on average, public pension funds experienced a consistent and positive return on their private equity investments over the 10-year period, outperforming many traditional asset classes. The 9.57% annualized return suggests that these funds were able to generate significant growth on their investments in private equity, which can contribute to the overall financial health and sustainability of the pension funds in question.
Private equity deal value in the industrial sector increased by 44% globally in 2020.
The statistic indicates that the total value of private equity deals within the industrial sector experienced a significant rise of 44% worldwide in the year 2020. This increase suggests a notable surge in private equity investments within the industrial sector, showcasing growing interest and confidence from investors in this particular industry. Factors such as market dynamics, technological advancements, or changing consumer behaviors may have contributed to this uptick in private equity deal value. The statistic reflects a positive trend in private equity activity within the industrial sector, highlighting opportunities for further investment and potential growth in this sector.
Megadeals ($5 billion or more), which are largely carried out by private equity firms, accounted for 26% of total deal value in 2020.
The statistic indicates that in 2020, large-scale transactions known as Megadeals, valued at $5 billion or more, constituted a significant portion of the total deal value, capturing 26% of the market. These Megadeals were predominantly executed by private equity firms, suggesting that such entities played a substantial role in shaping the financial landscape during that year. This data highlights the significant influence and activity of private equity firms in driving high-value transactions, which are likely to have a notable impact on various industries and markets.
Emerging markets attracted $24 billion of private equity investment in 2020.
The statistic “Emerging markets attracted $24 billion of private equity investment in 2020” indicates the total amount of capital that was invested by private equity firms in businesses and projects located in countries categorized as emerging markets during the year 2020. This figure reflects the level of interest and confidence from private investors in the growth potential and opportunities present in these developing economies. The influx of $24 billion in private equity funding signifies a significant injection of capital that can support and drive economic development, innovation, job creation, and overall market expansion in emerging markets.
The private equity industry in Latin America attracted $4.1 billion in new investments in 2020.
The statistic that the private equity industry in Latin America attracted $4.1 billion in new investments in 2020 signifies a significant influx of capital into the region’s private equity sector during a challenging economic environment. This substantial amount reflects continued interest from investors in funding businesses and projects in Latin America, despite the global uncertainties brought about by the COVID-19 pandemic. The growth in private equity investments could be driven by perceived opportunities for high returns, market potential, and the region’s growing economic influence. This statistic suggests confidence in the region’s businesses and potential for growth, highlighting the importance and attractiveness of Latin America as an investment destination for private equity firms.
GPs of private equity funds have $802 billion in registered funds targeting launch in 2021.
The statistic indicates that general partners (GPs) of private equity funds have collectively raised $802 billion in funds that are registered and targeted for launch in 2021. This means that private equity firms have amassed a significant amount of capital from investors which they plan to deploy into various investment opportunities throughout the year. The size of these registered funds underscores the strong interest from investors in private equity as an asset class and reflects the potential for these funds to drive significant investments and acquisitions in companies across different sectors in the coming year.
In 2020, there was a surge of nearly 20% in capital targeted at private equity real estate funds.
The statistic indicates that in 2020, there was a substantial increase of almost 20% in the amount of capital being directed towards private equity real estate funds. This surge suggests a growing interest and confidence from investors in the real estate sector despite the challenges posed by the global pandemic. The significant rise in capital targeted at private equity real estate funds could be attributed to factors such as low interest rates, potential for higher returns in real estate investments, and the perception that real estate is a tangible asset that can provide a level of stability in uncertain economic times. Overall, this statistic reflects a notable shift in investment behavior towards real estate as investors seek opportunities for growth and diversification in their portfolios.
According to Preqin, as of 2021, the average global private equity fund has a life span of 13.6 years from launch to liquidation.
The statistic provided by Preqin states that the average global private equity fund has a life span of 13.6 years from the time it is launched to when it is fully liquidated. This means that private equity funds typically have a relatively long-term investment horizon, with fund managers actively managing the fund’s portfolio of investments over an extended period of time before realizing and distributing the returns to investors. The 13.6-year life span figure provides insight into the patient and strategic nature of private equity investing, highlighting the commitment required by both fund managers and investors to see investments through to maturity and achieve optimal returns.
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