Data & Intelligence
2015 Global Limited Partners Survey
Key findings from the 2015 LP Survey:
- Over the next two years, 33% of LPs* plan to increase the percentage of their total PE allocation targeted at emerging markets (versus 41% in the 2014 survey), and 47% of LPs* anticipate increasing the dollar value of new commitments to EM PE funds (versus 54% in the 2014 survey).
- LPs identify measuring performance and benchmarking results, followed by transparency, as posing the greatest concern in the management of their EM PE portfolios.
- Latin America (ex. Brazil), Southeast Asia and Sub-Saharan Africa hold onto the top three spots in the ranking of most attractive emerging markets for GP investment, with Latin America (ex. Brazil) and Sub-Saharan Africa poised to see the largest influx of new capital from LPs over the next two years.
- Among all sectors, the highest percentage of LPs express interest in building exposure to healthcare and consumer services/goods via private equity in emerging markets, whether through generalist or sector-specific funds.
- EM PE portfolio performance continues to meet or exceed expectations for the majority of LPs (75%). Though return expectations for EM PE funds have cooled, LPs still expect 2014-vintage vehicles for emerging markets to outperform their developed markets counterparts.
- Across global private equity markets, Emerging Asia funds are expected to net the highest returns. More than half of LPs expect 2014-vintage funds focused on Southeast Asia, China and India to net returns of 16% or higher.
- LPs expect value creation to drive 60% of returns for EM PE funds, compared to 50% for developed markets PE funds. LPs anticipate leverage driving approximately 30% of returns for developed markets funds versus 10% for EM PE funds.
- Limited partners view political risk as the main deterrent for investing in eight of the ten emerging markets/regions identified in the survey.
Renuka Ramnath | Founder, Managing Director & Chief Executive Officer, Multiples Alternate Asset Management Private Limited
Brian Lim | Partner and Head of Asia and Emerging Markets, Pantheon Ventures
David Rubenstein | Co-Founder and Co-Executive Chairman, The Carlyle Group
Dr. Andrew Kuper | Founder and CEO, LeapFrog Investments
Torbjorn Caesar | Senior Partner, Actis
Drew Guff | Managing Director & Founding Partner, Siguler Guff & Company