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PrivateCapitalMarketUpdate8thAnnualGlobalFundFinanceSymposium
HeadofPrivateEquityChristopherElvin
21stMarch2018,NewYork
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Defini7ons
2017Round-up
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1,733 1,807 1,947 2,189 2,242 2,388 2,582 2,829
332 371 400474 472
551604
638
447559
593706 749
803780
811
162210
221
276 296324
386418
102114
141
173 186194
230229
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Jun-17
AUM($
bn)
AssetsUnderManagementbyAssetClass,Dec2010toJune2017
PrivateEquity PrivateDebt RealEstate Infrastructure NaturalResources
GlobalPrivateCapitalAUMataRecordHigh-$4.9tn
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StellarPrivateCapitalFundraisingCon7nues-$810bnRaisedin2017
179 226 238317 370 361
440 48256
76 87
108115 136
128124
3326 29
4942 50
6667
4044
62
7673
100
108116
1211
31
3331
44
2621
0
100
200
300
400
500
600
700
800
900
2010 2011 2012 2013 2014 2015 2016 2017
AggregateCapitalRaised($bn
)AnnualAggregateCapitalRaisedbyAssetClass,2007-2017
PrivateEquity RealEstate Infrastructure PrivateDebt NaturalResources
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Distribu7onsCon7nuingtoOutstripCall-UpsandDriveFundraising
-400-300-200-100
010020030040050060070080090010001100
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 H12017
PrivateCapital:CapitalCalledUpandDistributed,2000-H12017
CapitalCalledup($bn)
CapitalDistributed($bn)
NetCashFlow($bn)
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RecordLevelsofCapitaltoInvest-$1.7tn
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17
DryPo
wde
r($b
n)
PrivateCapitalDryPowder,2006-2017
Infrastructure
NaturalResources
PrivateDebt
RealEstate
PrivateEquity
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S7llaSellers’Market
-50
50
150
250
350
450
550
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2010 2011 2012 2013 2014 2015 2016 2017
AggregateDe
alValue
($bn
)
No.ofD
eals
PrivateEquity-BackedBuyoutDealsGlobally,2010-2017
No.ofDeals DealValue($bn)
-50
50
150
250
350
450
550
0
500
1000
1500
2000
2500
2010 2011 2012 2013 2014 2015 2016 2017
AggregateExitVa
lue($bn
)
No.ofE
xits
PrivateEquity-BackedBuyoutExitsGlobally,2010-2017
No.ofExits ExitValue($bn)
Investors
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12,500Ac7veIns7tu7onalInvestorsGlobally
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LimitedPartnerEvolu7on
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UseofAlterna7veStructuresCon7nuestoGrow
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PerformanceMedianPublicPensionFundNetReturnsbyAssetClass(AsatJune2017)
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AreAlterna7veAssetsMee7ngLPExpecta7ons?
5%
29%
12% 7% 10%21%
69%
60%
66%68% 65%
61%
26%
12%22% 25% 25%
18%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
PrivateEquity HedgeFunds RealEstate Infrastructure PrivateDebt NaturalResources
Prop
or]o
nofRespo
nden
ts
InvestorViewsonPor^olioPerformanceOverthePast12MonthsRela]vetoExpecta]ons
ExceededExpecta]ons
MetExpecta]ons
FallenShortofExpecta]ons
Challenges
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KeyChallengesfor2018
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
MarketVola]lity
DealFlow
Performance
Fees
Valua]ons
InvestorViewsontheKeyIssuesin2018
NaturalResources PrivateDebt Infrastructure
RealEstate HedgeFunds PrivateEquity
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
FeePressure
MarketVola]lity
DealFlow
Performance
Valua]ons
FundManagerViewsontheKeyIssuesin2018
NaturalResources PrivateDebt Infrastructure
RealEstate HedgeFunds PrivateEquity
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FundraisingMoreCompe77veThanEver
74%
82%
80%
75%
31%
73%
26%
18%
18%
20%
43%
25%
0%
0%
20%
50%
26%
20%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
NaturalResources
PrivateDebt
Infrastructure
RealEstate
HedgeFunds
PrivateEquity
FundManagers-FundraisingClimateTodayvs.12MonthsAgo
MoreChallenging
NoChange
LessChallenging
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InvestorsareFindingSourcingFundsMoreChallenging
18%
28%
48%
49%
38%
50%
77%
65%
43%
50%
52%
45%
5%
7%
9%
1%
10%
5%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
NaturalResources
PrivateDebt
Infrastructure
RealEstate
HedgeFunds
PrivateEquity
InvestorsViewsonAbilitytoFindA^rac7veInvestmentOpportuni7esvs.12MonthsAgo
HardertoFindAarac]veOpportuni]es NoChange EasiertoFindAarac]veOpportuni]es
Outlookfor2018
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RecordNumberofPrivateCapitalFundsinMarket–3,766VehiclesTarge7ng$1.4tn
1,624 1,561 1,6191,845 1,949
2,0982,235
2,651
2,965
3,766
888699 607
758 797 733 793946 1,008
1,369
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Mar-18
PrivateCapitalFundsinMarket,Jan2009toMar2018
No.ofFundsinMarket AggregateCapitalTargeted($bn)
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PrivateCapitalFundManagersConfidentinFindingValue
70%
77%
74%
64%
66%
29%
20%
24%
30%
27%
1%
3%
2%
6%
7%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
NaturalResources
PrivateDebt
Infrastructure
RealEstate
PrivateEquity
AmountofCapitalFundManagersPlantoDeployin2018vs.2017
MoreCapital
SameAmountofCapital
LessCapital
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Ins7tu7onalPlansfor2018
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…AndfortheLongerTerm
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FurtherInforma7onTodiscussPreqin’sservicesandresearchpleasevisitwww.preqin.comorcontactChristopherElvin-celvin@preqin.com.