Sneak peek: Our latest Global Markets Snapshot, which tracks returns data across indexes and sectors, will get a wide release in Tuesday's newsletter. Weekend readers can get it early here.
Summer hits: As we reach the unofficial end of summer, we wanted to share some of our most popular research over the past few months that you might have missed: | | | | | |
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| General partner franchises continue to prosper | | When it comes to the business of being a GP, the seven largest US-listed alternative asset managers provide an excellent looking glass through which we can peer. This week, we released our Q2 Public PE and GP Deal Roundup, which extracts the key PE metrics posted by Blackstone, KKR, Apollo, Carlyle, Ares, TPG, and Blue Owl in a strictly "GP" context. We use their earnings reports to monitor all things PE-related, such as trends in capital deployment, realization, fundraising, and performance. In the report, we also track transactions that involve private GPs as targets. This allows us to gauge consolidation prospects for the industry as well as demand for minority stakes, also known as GP stakes—a strategy that has gained significant investor interest over the last few years. Key takeaways from this quarter's report: • Stakes in GPs changed hands at a brisk pace in Q2, with nearly half representing control transactions by strategic buyers, such as TPG's blockbuster deal for Angelo Gordon. The other half represented minority stakes acquired by dedicated GP stake funds, such as Blue Owl's investment in Stonepeak, a $56 billion AUM infrastructure manager. • Perpetual capital at these GPs surpassed $1.2 trillion, or 38.4% of total AUM. Perpetual capital has an indefinite duration, and the industry's largest managers are in a footrace to push these assets as high as the market will allow. Over the last year, perpetual AUM at these managers has grown by 13.2% outpacing total AUM growth of 9.8%.  • The big seven managers all posted positive returns in their respective PE portfolios, with a median gross return of 3.1%. This marks the third consecutive quarter of low-single-digit positive returns. On a TTM basis, these managers posted a median gross return of 9%, below the 13% return on the S&P 500 during the same span. • PE capital deployed remains soft, with TTM value down 22.3% YoY. Still, there are signs of improvement as Q2 deployment figures were higher QoQ for most of the public PE firms. • PE fundraising rebounded from a weak Q1 but is still down 57.4% YTD. Total fundraising across all strategies of the seven firms combined for $106.7 billion in Q2—a 6.4% increase from Q1. This ended a three-quarter skid of sequential declines. However, on a TTM basis, most managers are still tracking below their prior run rates. While the PE industry is well off its 2021 peak on most operating metrics, being a GP is still a very good business. One only needs to look at the healthy deal flow in GP stakes and the strong performance of the publicly listed GP stocks. Collectively, these seven alt managers now command $313 billion in market value, nearly twice that of the $174 billion in market cap of the top seven US-listed traditional asset managers. Clearly the market is signaling for now that the good times will continue to roll for GPs and their alt management franchises—and investors are taking notice. For more data and analysis, download our free US Public PE and GP Deal Roundup. | | Enjoy the read!
Tim Clarke
Lead Analyst, Private Equity | | | | | | | |
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Can any space tech startup thrive in SpaceX's shadow?
While trips to Mars may be far on the horizon, VC is still betting on the sector. Our Vertical Snapshot covers the key players and areas for potential growth and competition.
These include startups launching satellites and others working toward pharmaceutical development in space: | | | | | | For clean energy founders, it feels like boom times again
VC-backed clean energy startups brought in $5.4 billion in Q2—their best quarter since 2021.
Driving the industry's resilience is major investment into solar and hydrogen tech, per our Clean Energy Report.
For new opportunities, look to geothermal energy and nuclear fusion, where technologies are targeting our reliance on fossil fuels: | | | | | | While consumer spending on video games has remained healthy, VC funding has stayed flat.
Gaming startups raised $1.1 billion across 110 deals in Q2—showing funding in H1 to be on par with 2020 levels.
According to our Gaming Report, the development segment has outpaced content as startups look for new ways to help create the next big games.
Emerging opportunities within the sector include startups focused on cloud gaming and user-generated content sandboxes for players: | | | | | |
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A trio of webinars later this month:
Sept. 11: In this Emerging Tech Talk, analyst Eric Bellomo hosts Drew Marconi, CEO and co-founder of Intelligems, to discuss trends in e-commerce. Register here.
Sept. 13: We're teaming up with J. Thelander Consulting to discuss how compensation trends at VC and PE firms have changed in recent years, and what to expect going forward. Register here.
Sept. 20: Our US PE analyst team will revisit their 2023 forecasts from the start of the year, covering exits, fund returns, take-private activity, and more. Register here.
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Our insights and data featured in the press: - Why Instacart is entering the public markets at a time of cautious enthusiasm. [Bloomberg]
- This year, 59 high-yield bonds have been issued to refinance outstanding leveraged loans, up from 25 over the entirety of 2022. [FT]
- London tech unicorns are becoming much harder to spot. [City A.M.]
- Gaming VC activity remains subdued. [VentureBeat]
- Why some parts of the healthcare industry have remained resilient, while others are harder hit by the economic climate. [MedCity News]
- After a decade of favorable conditions, challenger banks "may now be experiencing the impacts of rising inflation, higher interest rates, and lower growth prospects." [Sifted]
If you're a journalist interested in interviewing our analysts or requesting data, contact our PR team.
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Highlights from our other recent research:
Market updates
Thematic research
Industry & tech research
Coming next week (subject to change) - UK Private Capital Breakdown
- Greater China VC Report
- Emerging Tech Indicator
- US VC-Backed IPO Outlook
- Analyzing GenAI Applications in E-Commerce
- Cardiovascular Disease and Heart Health
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| | Since yesterday, the PitchBook Platform added: | | 394 Deals | 2524 People | 595 Companies | 21 Funds | | | | | | |
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