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The Outlook for the Private Equity Funds of Funds Market

by Joe Childs

  • 20 May 2010
  • PE

Preqin’s Funds in Market database monitors the private equity fundraising market including the activity of fund of funds managers. It shows that the amount of capital raised by funds of funds in Q1 2010 was down by approximately 73% compared to Q1 2009, while the number of vehicles holding a final close was down by 65% from the same period last year. The number of funds of funds closing in the first quarter of this year was down by 61% relative to the final three months of 2009, although the amount of capital raised was only down by 30%, mainly due to Axiom Asia Private Capital exceeding its USD 750 million target to close on USD 950 million.

The number of private equity funds of funds that have the potential to make their first commitments during 2010 is considerable, however. While just over 60 vehicles have a 2009 vintage, 23 funds of funds are already confirmed as being 2010-vintage and a further 67 could hold an interim or final close before the end of the year. Although it is likely that some of these will not hold closings this year as anticipated, the number hoping to deploy capital in the near future is encouraging for general partners.

More than 150 private equity funds of funds are currently raising capital, including 21 vehicles that have been brought to market by first-time managers. A further 63 funds of funds are expected to be launched by 54 managers before the end of the year.

For more information on the private equity fundraising market please see how Funds in Market can assist you.

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