NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Private Equity Performance: Returns, Persistence and Capital

Steven Kaplan, Antoinette Schoar

NBER Working Paper No. 9807
Issued in June 2003
NBER Program(s):   CF

This paper investigates the performance of private equity partnerships using a data set of individual fund returns collected by Venture Economics. Over the sample period, average fund returns net of fees approximately equal the S\&P 500 although there is a large degree of heterogeneity. Returns persist strongly across funds raised by individual private equity partnerships. Better performing funds are more likely to raise follow-on funds and raise larger funds than funds that perform poorly. This relationship is concave so that top performing funds do not grow proportionally as much as the average fund. Finally, market entry in private equity is cyclical. Funds (and partnerships) started in boom times are less likely to raise follow-on funds, suggesting that these funds subsequently perform worse. Several of these results differ markedly from those for mutual funds.

download in pdf format
   (306 K)

email paper

This paper is available as PDF (306 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w9807

Published: Kaplan, Steven and Antoinette Schoar. “Private Equity Performance: Returns, Persistence and Capital Flows." Journal of Finance 60 (August 2005).

Users who downloaded this paper also downloaded these:
Kaplan and Stromberg w14207 Leveraged Buyouts and Private Equity
Bernstein, Lerner, Sorensen, and Stromberg w15632 Private Equity and Industry Performance
Ljungqvist and Richardson w9454 The cash flow, return and risk characteristics of private equity
Jegadeesh, Kraussl, and Pollet w15335 Risk and Expected Returns of Private Equity Investments: Evidence Based on Market Prices
Harris, Jenkinson, and Kaplan w17874 Private Equity Performance: What Do We Know?
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us