A private equity fund has raised globally $595 billion in 2019, less than what they raised in the preceding two years, media reported.  However, in 2019 fundraising was the third-highest ever, only surpassed by 2017 and 2018 when private funds generated $ 628 billion each. Many of the funds are raised their targeted corpus from their investors, however, fell from third-year i.e. 2,398 in 2017 to 1,790 in 2018 and 1,316 in 2019, indicating that investors are only willing to back select funds and showing an increasing average ticket size of a fund. In the year 2019 saw $393 billion in buyout deals and $224 billion in venture capital deals announced, compared to $493 billion and $271 billion, respectively in 2018. ‘This was boosted in part by sky-high valuations, which saw the average buyout deal size hit a 10-year high of $490 million,’ media reported.
The impact of high valuations on future performance has weighed heavily on fund managers and many have been slowing the pace of their dealmaking as they make sure not to overpay for acquisitions, the report said. Due to this, dry powder, or unutilized capital funds has continued to climb and hit a new high of $ 1.43 trillion as the end of 2019.
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