There are at least 70 dedicated private equity secondaries funds in market targeting an aggregate $84 billion, Secondaries Investor data shows.
That figure is $11 billion shy of the record $95 billion collected in final closes across secondaries vehicles last year. Dedicated vehicles for the strategy collected just $42 billion the year prior.
The top of the list comprises Lexington Partners‘ Lexington Capital Partners X, which seeks $15 billion, $1 billion more than its predecessor fund’s hard-cap; Strategic Partners‘ Strategic Partners Fund IX, which is seeking $13.5 billion, $2.4 billion more than its last programme; and Landmark Partners‘ 17th flagship, which is seeking $6 billion.
The lion’s share of funds focus on private equity secondaries – only 15 of the 70 vehicles will not take some amount of PE exposure. The next most popular sub-category is venture capital, with at least 18 funds fully or partially dedicated to the strategy. Six funds focus in some way on infrastructure, two to debt and two to real estate.
Fuelled by the maturation of private capital markets and an increasing view that secondaries can be a credible liquidity option, secondaries strategies have become a dependable fixture of the alternatives ecosystem. According to Peter Martenson, a partner at Eaton Partners and global head of secondaries & directs, overall returns for the asset class have been good to very-good on a risk-adjusted basis. LPs reward good sponsors with additional funds more often than not, as Coller Capital‘s latest LP survey found.
Secondaries funds have broadened much past simply buying LP interests, Martenson added.
“The secondaries market will only grow larger as the private capital markets continue to grow, which means there will continue to be larger and more esoteric, focused, niche secondary solutions to answer this search for liquidity [in alternative markets].”