UK private equity outperforms pension funds

BVCA survey says VC and private equity funds have made almost double the returns of pension fund assets over the last decade

UK private equity and venture capital (VC) funds have made almost double the returns of pension funds and the FTSE All-Share in the past 10 years, the British Venture Capital Association (BVCA) has reported.

Intended to highlight the performance of independent British private equity firms, the research found that VC and private equity had witnessed a combined 10-year internal rate of return of 14.9% in 2014 – nearly double the 7.8% and 7.6% returned by UK pension funds and the FTSE respectively.

The report also marked the highest performance for VC funds since the recession and the first time that since-inception returns for pre-2002 funds have been positive since the BVCA began its annual Performance Measurement Survey.

This “comfortable outperforming” of British private equity was said to be down to improved stability with UK GDP having returned to its pre-recession peak, which in turn had helped restore confidence among businesses and investors.

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