Secondaries funds best performer in Q3

The strategy itself had higher IRRs and return multiples than any other fund types traded during the period, according to Setter Capital.

Secondaries funds that were traded on the market during the third quarter of 2016 had higher performance figures than any other strategy, according to data from Setter Capital.

Private equity secondaries funds delivered 16.5 percent internal rates of return and 1.59x multiples on average, according to the Toronto-based advisory firm’s September Price Report. Venture capital and buyout were the next best performing strategies, delivering IRRs and multiples of 12.7 percent and 1.43x, and 9.73 percent and 1.43x respectively.

Cleantech was the worst performing strategy with a minus 3.06 percent IRR and a 0.99x multiple on average.

Secondaries funds and funds of funds are increasingly using the market to dispose of stakes. Such sellers include Ardian, which was close to closing a deal to sell stakes held in its 1999, 2001 and 2004-vintage secondaries funds to Blackstone’s Strategic Partners as of mid-October, as Secondaries Investor reported.

Setter Setter based its data on 755 funds it priced during the three months to 30 September. This included 326 buyout, 112 venture, 12 secondaries funds and eight cleantech funds.

Source: Setter Capital