PE returns: optimistic expectations For all the challenges and uncertainty that GPs have to navigate, the survey findings reveal that respondents remain confident of delivering returns in the mid-to-high teens, with GPs generally more sanguine about return prospects than a year ago. Asked to forecast net returns in 2025 for the PE industry as a whole, EMEA and North American respondents estimate an average of 17.1%, while APAC respondents expect an average of 17.4%. Interestingly, survey respondents expect slightly lower returns for their own funds. APAC and EMEA respondents each estimate their funds will deliver net returns for 2025 of 16.5% on average, and North American respondents estimate net returns of 16.8%. Overall, respondents’ estimates for net returns are more optimistic than one year ago, with predictions for their own funds up from an average of 15.8% to 16.6%, and predictions for average net returns for the industry as a whole up from 16.5% to 17.1%. “The expectation of a 17% net return implies a 2.4-2.6 gross multiple on invested capital across a five-to-six-year period. That might be ambitious for deals done at high entry valuations at the peak of the market in 2020 and 2021, but is realistic for deals in 2023, 2024 and 2025, given the entry multiples and the financing mix and value-creation playbooks that PE sponsors have refined,” Bolsinger says.
What do you estimate the net return for 2025 to be for your fund and the PE industry? (%) Means shown
TotǸl
16.6
17.1
AsiǸ-PǸcific
16.5
17.4
EMEA
16.5
17.1
North AmȃricǸ
16.8
17.1
16.0 16.2 16.4 16.6 16.8 17.0 17.2 17.4 17.6
Your fund (%)
Thȃ PE industry (%)
10
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