More funds raising capital than ever before

  • Globally 1,061 funds closed on $550 bln in capital in 2015
  • Blackstone’s $18 bln flagship was 2015’s biggest U.S.-focused fund
  • KKR’s $10 bln pool is biggest U.S.-focused fund yet to close

Private equity fundraising has hit a fever pitch.

Some 1,630 funds worldwide are in the market trying to raise $488 billion, according to Preqin, which provides data and intelligence to the alternative assets industry. The current total is greater than the prior peak set in 2008, when 974 funds sought $482 billion, Preqin said.

Globally, 1,061 funds closed on $550 billion in investor commitments in 2015, compared 1,334 funds that closed on $555.2 billion in 2014, Preqin said.

“More capital was concentrated among fewer managers [in 2015],” said William Clarke, a Preqin communications analyst.

Private equity also posted another record year for dry powder. The level of unspent capital reached $752 billion in 2015, up from $695 billion in 2014. Fund managers are finding it “increasingly challenging” to put capital to work into attractive opportunities, Preqin said.

Venture emerged as the sector with the most funds seeking capital. Currently, 751 VC funds are in the market targeting $85 billion, compared to 318 buyout funds aiming for $241 billion, Preqin said.

The biggest U.S. fund to close in 2015 came from the Blackstone Group, which in December raised $18 billion for its latest flagship pool. Warburg Pincus came in second, collecting $12 billion with its latest offering.

The largest U.S. fund still in the market is KKR’s flagship, which is targeting $10 billion.

In second place is TPG, which is seeking $8 billion with its latest pool, Preqin said. (Buyouts has reported that TPG is targeting $10 billion for its newest flagship fund.) In third place is Vista Equity Partners, which is reportedly aiming for $8 billion for its newest fund.

The five largest U.S.-focused funds that closed in 2015 are:

  1. Blackstone Capital Partners VII, $18 bln
  2. Warburg Pincus Private Equity XII, $12 bln
  3. Lexington Capital Partners VIII, $10.1 bln
  4. GS Mezzanine  Partners VI  LP, $8 bln
  5. TA XII, $5.3 bln

The five largest U.S.-focused funds still in the market are:

  1. KKR Americas Fund XII, $10 bln
  2. TPG Partners VII, $8 bln*
  3. Vista Equity Partners Fund VI, $8 bln
  4. Green Equity Investors VII, $7.5 bln
  5. Thoma Bravo Fund XII, $7 bln

(*Buyouts has reported that TPG’s target for Fund VII is $10 billion. TPG declined comment.)

Action Item: Read the Preqin report here: http://bit.ly/1PKU2fH

Preqin fig 1

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