Private Equity & Private Markets

Institutional private equity, buyout, growth, and venture-style funds — including feeder vehicles, evergreen structures, and retail-access platforms.

Market Size

Private equity is a multi-trillion-dollar global asset class; private markets have become a primary source of growth capital for mid-market and late-stage companies.

Typical Returns

Target net returns vary widely by strategy and vintage: Buyouts often target ~12–18% net IRR; Growth equity ~12–20%; Secondaries ~10–15%; Distressed/special sits can be higher but more cyclical.

Overview

Private equity (PE) involves buying stakes in private companies (or taking public companies private) and improving them over multi-year hold periods through operational upgrades, strategic repositioning, and financial structuring. Typical PE strategies include leveraged buyouts (LBOs), growth equity, carve-outs, roll-ups, and special situations. The core tradeoff is illiquidity for an “illiquidity premium”: PE targets higher returns than public markets, but capital is generally locked up 7–12 years, with distributions coming unevenly over time. Investors access PE through institutional funds, interval/evergreen funds, BDCs, and (in limited cases) secondary marketplaces and SPVs.

Key Benefits

Illiquidity premium: potential for higher long-term returns than public equities (with higher dispersion)
Operational value creation (not just multiple expansion): margin improvement, pricing, add-on acquisitions
Access to private-market deal flow and companies not available in public markets
Downside tools: covenants, control rights, board seats, and active ownership
Diversification versus public equities (though correlated in downturns, but typically with lag)
Potential inflation resilience in sectors with pricing power and contracted revenues

Platform Reviews

In-depth analysis using our three-pillar evaluation framework

View All

iCapital (Institutional Capital Network, Inc.)

Private Markets Access (Private Equity, Private Credit, Hedge Funds, Real Estate, Structured Investments)B2B Fintech Infrastructure for Advisor-Mediated Private Markets Access

Advisor-only private markets infrastructure—iCapital is not a self-directed investing platform. It powers feeder funds and workflows that let advisors place clients into institutional alternatives at lower minimums, but adds an extra layer of fees and creates platform/advisor dependency.

Updated Feb 23, 2026

Latest Research & Analysis

View All

private-equity-private-markets•Feb 23, 2026

Private Equity vs. Venture Capital Returns: Performance Metrics, Fund Structures, and Allocation Strategy

Compare private equity vs venture capital returns, risk, liquidity, and fee structures. Includes IRR, DPI, MOIC, TVPI, and PME benchmarks from Cambridge Associates, fund structure comparisons, and a tier-by-tier allocation framework for accredited investors.

How to Start Investing in Private Equity

Choose your access route (based on liquidity + minimums)

Most investors access PE via: (1) traditional closed-end funds (high minimums, long lockups), (2) evergreen/interval funds (lower minimums, periodic liquidity), (3) publicly traded vehicles (BDCs, asset managers), or (4) secondaries/SPVs (deal-by-deal exposure, higher complexity).

Set an allocation and timeline (PE is slow money)

PE cash flows are irregular: capital is called over time, and distributions may not start for 2–4 years. Plan for 7–12 years of illiquidity and avoid investing capital you’ll need for near-term expenses.

Understand fees + the J-curve

Typical fee model is 2% management fee + 20% carried interest (varies by fund). Early years can show negative performance due to fees and costs before value creation and exits (the “J-curve”).

Diversify across vintage years and strategies

PE outcomes are highly dispersed. Diversify across 3–5 funds (or a diversified evergreen fund) spanning multiple vintage years and strategies (buyout, growth, secondaries) to reduce single-vintage risk.

Private Equity Risks

Important considerations before investing in private equity & private markets

Illiquidity: capital typically locked 7–12 years; liquidity windows (if any) are limited and not guaranteed
Fee drag: management fees + carry can materially reduce net returns, especially in average funds
J-curve: early-year negative returns and limited distributions can surprise investors
Leverage risk: buyouts often use debt; downturns can impair equity quickly and refinancing can be difficult
Valuation opacity: marks are appraisal-based (not market-clearing) and can lag real conditions
Vintage risk: entry valuations and financing conditions at the time of investment matter a lot
Manager dispersion: top-quartile funds can vastly outperform median funds; selection risk is significant
Concentration risk: some funds concentrate by sector, geography, or deal size; risk can be hidden

Due Diligence Checklist

Assess manager track record by vintage year (not just blended IRR); look for consistency across cycles
Evaluate strategy fit: buyout vs growth vs secondaries vs special situations (risk/return drivers differ)
Understand fee stack: management fee, carry, fund expenses, deal fees, monitoring fees, leverage costs
Review portfolio construction: number of companies, sector concentration, deal size, geographic exposure
Check leverage profile: average debt/EBITDA, covenant terms, maturity walls, and refinancing sensitivity
Scrutinize valuation policy: how marks are set, frequency, third-party involvement, and write-down behavior
Liquidity terms (if evergreen/interval): gates, quarterly limits, and circumstances where redemptions can be suspended
Alignment: GP commitment, hurdle rates, clawbacks, and whether the GP earns fees on committed vs invested capital

Real-World Examples

Buyout example: Acquire a founder-owned industrial services business, install professional management, expand margins, add bolt-on acquisitions, exit to a strategic buyer in 5–7 years.

Growth equity example: Invest in a profitable B2B software firm to fund sales expansion and international growth without taking full control; exit via strategic sale or IPO.

Secondaries example: Purchase LP interests at a discount or invest in a GP-led continuation vehicle to reduce J-curve and gain faster distributions (with its own pricing risks).