Private equity showed a gradual decline in 2022, but fundraising and company investment and exit activity remain comparable to the pre-pandemic levels seen in 2018 and 2019.
Fundraising: In 2022 private equity partnerships holding final closes raised $870 billion across 2,211 partnerships (unless otherwise noted, all data is from PitchBook and 4Q numbers are very preliminary). The dollar amount is 16% lower than 2021, but partnerships plunged by 47%. 4Q had final closes totaling $166 billion, down 21% from 3Q. The number of funds totaled 407, down 20%.
Buyouts: New buyout investments for 2022 totaled 12,985, down 14% from 2021. Dollar volume fell 9% to $837 billion. 4Q saw 2,625 new investments, a 20% decrease from 3Q, but dollar volume rose 27% to $239 billion.
VC Investments: The year produced 51,020 rounds of new investment in venture capital (VC) companies, down 16% from 2021. Announced volume of $509 billion was down 31%. 4Q saw 9,280 new rounds, a 20% decline from 3Q, and dollar volume fell 21% to just $81 billion.
Exits: Last year saw 2,901 buyout-backed private M&A exits, down 23% from 2021, with proceeds of $590 billion, down 26%. 4Q had 551 private exits, down 22% from 3Q, with proceeds of $132 billion, down 2%. The year’s 201 buyout-backed IPOs dropped 55% from 2021, with proceeds of $33 billion, down 75%. 4Q IPOs numbered 50, down 21% from 3Q, and proceeds of $8 billion declined 27%. Venture-backed M&A exits for the year totaled 2,625, down 24% from 2021. Announced dollar volume of $110 billion fell 57%. The final quarter had 462 exits, down 20% from 3Q, and value of only $7 billion, plunging 72%. The year’s 317 venture-backed IPOs sank 51% from 2021, with proceeds of $41 billion, falling 75%. There were 106 in 4Q, up 33% from 3Q, but the $8 billion of proceeds fell 47%.
Returns: In 3Q, and in the two prior quarters, private equity fell by only about 35% of the public equity market’s decline. With the upcoming 4Q valuations being subject to annual audits, continued moderate declines are likely.
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