/GettyImages-680315933-91f81d88fdf94febb48c085ed5bb0bdd.jpg "World's Top 10 Private Equity Firms by Total Equity 1")
Non-public fairness corporations handle funding capital obtained from institutional buyers or high-net-worth people (HNWI) to accumulate fairness possession of firms by means of a wide range of methods, together with leveraged buyouts and enterprise capital. Non-public fairness corporations function with long-term funding horizons, sometimes 5 to seven years.
After acquiring an fairness curiosity in an organization, the non-public fairness agency appears to be like to finally revenue by means of both promoting the corporate outright or by means of an preliminary public providing (IPO). When particularly giant investments are required, these corporations usually companion with different non-public fairness corporations to lift the mandatory capital and to cut back their threat. Most corporations specialise in a number of industries or funding methods the place they’ve specific experience.
A report by Non-public Fairness Worldwide (PEI) ranked the highest 300 corporations based mostly on whole non-public fairness fundraising over the five-year interval ending on June 1, 2021. These are the highest 10 non-public fairness corporations, in keeping with that report. Readers ought to be aware that non-public fairness AUM could also be a subset of an organization’s whole belongings underneath administration. We report non-public fairness AUM within the checklist under the place accessible.
Key Takeaways
- Non-public fairness is an alternate type of non-public financing, occurring away from public markets, wherein funds and buyers instantly spend money on firms or have interaction in buyouts of such firms.
- Non-public fairness investments are sometimes accessible solely to high-net-worth people.
- Non-public fairness can tackle varied varieties, from complicated leveraged buyouts to enterprise capital.
- Non-public fairness corporations are sometimes ranked by their belongings underneath administration (AUM) and success in returning good points to buyers.
- The Blackstone Group Inc. had probably the most AUM out of any non-public fairness agency in 2021.
1. The Blackstone Group Inc.
Based in 1985 and headquartered in New York, with places of work in London, Hong Kong, Beijing, and Dubai, The Blackstone Group Inc. (BX) leads with $881 billion in whole belongings underneath administration (AUM).
The corporate invests throughout a broad vary of market sectors, together with power, retail, and expertise. Whereas non-public fairness ($126 billion) is its largest class of investments, Blackstone additionally has lots of of billions of {dollars} in holdings in actual property, credit score, and hedge fund options. Amongst its 107 portfolio firms are monetary markets information and infrastructure supplier Refinitiv, digital household historical past providers supplier Ancestry, and relationship and social networking apps proprietor and operator Bumble.
2. KKR & Co. Inc.
KKR & Co. Inc. (KKR), previously Kohlberg Kravis Roberts & Co., has a complete AUM of $459 billion. Based in 1976 and headquartered in New York, KKR is understood for being one of many first corporations to have interaction in giant scale leveraged buyouts (LBOs), that are nonetheless one of many agency’s specialties.
Among the many agency’s noteworthy transactions are its 1989 leveraged buyout of RJR Nabisco and its 2007 buyout of TXU, the most important leveraged buyout on file. Amongst its present portfolio holdings are Fiserv Inc., Optiv, and PetVet.
3. CVC Capital Companions
CVC Capital Companions has practically $122 billion of whole AUM; CVC’s non-public fairness platforms handle $92 billion of belongings. Based in 1981, CVC employs over 650 individuals, together with 300 funding professionals, in 24 places of work worldwide. Its non-public fairness portfolio consists of 114 firms from throughout the globe.
4. The Carlyle Group Inc.
The Carlyle Group Inc. (CG) has a complete AUM of $293 billion, employs over 1,800 professionals worldwide, and operates by means of 26 places of work throughout 5 continents. The corporate was based in 1987 and is headquartered in Washington, D.C. Its company non-public fairness unit has AUM of $161 billion, and notable present holdings embody Supreme, Workforce Logiq, and Orion Breweries Ltd. of Japan.
5. Thoma Bravo
Thoma Bravo has each $91 billion AUM and over 40 years of expertise offering capital and strategic assist to skilled administration groups and rising software program and expertise firms. A number of the most notable firms in its portfolio embody McAfee, Conga, and Anchorage.
Non-public fairness corporations present monetary backing to startups and to private firms. For instance, after Airbnb needed to postpone its authentic plans for a 2020 preliminary public providing (IPO), the corporate raised greater than $1 billion in non-public fairness funding.
6. EQT
Based mostly in Sweden, EQT AB has a complete AUM of 73.3 billion euros, or practically $81.7 billion on the present change fee. Based in 1994, the agency has roughly 1,200 workers in 24 nations throughout Europe, North America, and the Asia-Pacific area. Flying Tiger Copenhagen is maybe its best-known portfolio firm amongst U.S. shoppers.
7. Vista Fairness Companions
With over $86 billion in belongings underneath administration, Vista Fairness Companions invests in software program, information, and technology-enabled organizations, completely. The corporate has strategic investments throughout firms in healthcare, promoting, and threat administration, amongst different industries. In September of 2019, Vista closed a $16 billion expertise fund, the most important fund ever raised by an unbiased PE agency.
8. TPG Capital
TPG Capital has a complete AUM of $109 billion. Based in 1992 by David Bonderman and Jim Coulter, TPG Capital is headquartered in San Francisco, California. The corporate has 12 further places of work throughout eight nations.
Among the many agency’s noteworthy transactions are its buyout of Continental Airways in 1993, its acquisition of Petco in 2000 (with Leonard Inexperienced and Companions), and its leveraged buyout (together with Bain Capital and Goldman Sachs Capital Companions) of Burger King in 2002. Amongst its present portfolio holdings are Chobani, Fender, and AirBnB.
9. Warburg Pincus LLC
Warburg Pincus LLC has over $73 billion in whole AUM, invested in additional than 235 firms. The agency’s roots are in E.M. Warburg & Co., based in 1939, and Warburg Pincus was established in 1966. Headquartered in New York, it has places of work in 13 nations.
10. Neuberger Berman Group LLC
Neuberger Berman Group LLC has $460 billion in whole AUM, together with $70 billion in non-public fairness. Citing greater than 25 years of expertise in different investments, Neuberger Berman employs greater than 648 professionals within the discipline in 25 nations worldwide.
Largest Non-public Fairness Corporations FAQs
Which Non-public Fairness Corporations Pay the Most?
Non-public fairness is a really profitable profession. In line with a Heidrick & Struggles survey, in 2019 common money compensation, together with bonuses, ranged from $1.1 million to $3.7 million for managing companions at non-public fairness corporations with lower than $20 billion in AUM.
Our analysis discovered that the full common pay in 2019 ran from $596,000 to $2.2 million for companions and managing administrators, relying on the agency’s AUM. Common compensation for associates and senior associates was much less variable throughout agency sizes, starting from $193,000 to $315,000.
In line with the H1B Database, which compiles the bottom salaries of all U.S. workers underneath the widespread H1B visa, in 2019, the corporations that paid the best figures for an Affiliate place had been Apollo International Administration, KKR & Co., and Brookfield Asset Administration. An Affiliate is usually the bottom rating worker at a non-public fairness agency. They’re sometimes of their mid to late 20s and have a previous background in funding banking, consulting, or different deal-related monetary providers.
Peak Frameworks is a finance profession prep platform based by non-public fairness and funding banking professionals. Peak Frameworks reviews that Apollo International Administration is continuously reputed to be the highest-paying non-public fairness agency by way of all-in compensation, paying their Associates upwards of $400,000 per 12 months.
Is Bain Capital Prestigious?
Bain Capital was based in 1983 and relies in Boston. The corporate employs over 1,000 workers at its world places of work. Bain is well-known largely because of its co-founder, Mitt Romney, who was the 2012 Republican presidential nominee. He has served because the junior United States senator from Utah since Jan. 2019.
Bain’s portfolio has included some main manufacturers since its inception, together with Clear Channel Communications, Canada Goose, Virgin Holidays Cruises, and Bugaboo Worldwide. Different main previous holdings embody Staples, Sports activities Authority, Guitar Middle, Gymboree, Houghton Mifflin, Domino’s Pizza, Burger King, The Climate Channel, and Brookstone.
Total, the fund has a desire for retail, eating places, and different shopper manufacturers.
How A lot Does a VP in Non-public Fairness Make?
In non-public fairness, your whole compensation sometimes relies on the AUM of the agency you’re working for. Corporations which have bigger AUMs often pay their Vice Presidents extra.
In line with the 2020 North American Non-public Fairness Funding Skilled Compensation Survey by Heidrick & Struggles, these within the Vice President place at corporations with an AUM of lower than $500 million had a imply whole money compensation of $329,000 in 2019. For corporations with an AUM of $10 billion to $19.99 billion, the imply whole money compensation was $592,000.
Which Non-public Fairness Corporations Are Publicly Traded?
The 4 largest publicly traded non-public fairness corporations are Apollo International Administration, Blackstone Group, Carlyle Group, and KKR.
Alternatively, Creation Worldwide, Bain Capital, TPG Capital, and Warburg Pincus are all non-public firms.
The Backside Line
Skilled buyers at non-public fairness corporations elevate a big fund (often from prosperous buyers) and re-invest these funds with a purpose to search the most important potential earnings. The character of the non-public fairness business is dangerous, as corporations usually have interaction in giant acquisitions and controversial leveraged buyouts. It’s also not completely remarkable for personal fairness corporations to lose billions of {dollars} or for the corporations to fold fully. Nonetheless, the corporations on this article have all emerged as the most important and most profitable non-public fairness corporations.