Two Ways Successful Private Equity Funds Stand Out Early On
It’s difficult to analyze private equity fund performance in the first few years of its life cycle because net cash flows are generally still negative – fund managers are in the process of acquiring and bolstering private companies. But a study of more than 300 US buyout funds found that there are two early indicators of whether a fund will ultimately land in the top or bottom quartile of PE fund performance: early distributions and a shallow J-curve.
“Analysis of current immature funds can also . . .
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