Private Equity consists in investing in unlisted companies at different stages of their development, with the objective of creating value and then selling these companies a few years later targeting a significant capital gain for the investors.
We select Private Equity funds amongst the best performers of the markets and negotiate a privileged access for our clients.
Maxime Jouret
Global Deputy-Head of Private Markets
Private Equity: how it works?
A Private Equity manager creates a fund by raising capital, mainly from institutional investors, with the strategy to take equity stakes in unlisted companies.
A Private Equity fund generally has a legal life of several years. During the first years, the fund gradually invests in the capital of unlisted companies as a minority or majority shareholder. Then the Private Equity manager supports them in the implementation of a value-added strategy. Over the last years of the fund’s life, the portfolio companies are successively sold and the sale proceeds are distributed to investors (there is a risk of capital loss and profits are not guaranteed).
There is an important diversity of strategies in the Private Equity market, notably depending on investment stage (Venture Capital, Growth, Buyout…), value creation approach, investment sectors and targeted geographies.
Why invest in Private Equity?
INVEST IN THE REAL ECONOMY
Private Equity funds aim to support and grow the companies in which they invest. By committing in these funds you gain access to high quality and growing unlisted companies which are frequently led by entrepreneurs.
Source: Invest Europe
DIVERSIFY YOUR WEALTH
Private Equity solutions present an interesting risk-return profile. Whatever the economic cycle, Private Equity investments enable to diversify your wealth.
Source: BNP Paribas Wealth Management, Strategic-A as of Oct. 2022. Bonds: Bank of America Merrill Lynch EMU Corp IG (Jan. 1996 – Oct. 2022); Equity: DJ EuroStoxx 600 (Dec. 1987 – Oct. 2022); Private Equity: Cambridge Associates DM (Dec. 1986 – Oct. 2022).
SEEK ATTRACTIVE RETURNS
In a context of volatile public markets and a complex macro economic environment, Private Equity solutions present a real investment opportunity to seek sustainable and attractive returns over the long term.
*Horizon IRR (Internal Rate of Return) is a capital-weighted pooled calculation that shows the IRR for a certain range in time. For example, the one-year horizon IRR figures in the report may show the IRR performance for the one-year period beginning in Q2 2020 through the end of Q1 2021 while the three-year horizon IRR is for the period beginning in Q2 2020 through the end of Q1 2023. Past performance is not a reliable indicator of future performances. No guarantee is given on the success, profitability, return or benefit of this investment.
**As of 30/09/2022 with preliminary quarterly returns.
Source: Pitchbook 2022.
Why Invest in Private Equity with BNP Paribas Wealth Management?
- Draw on the expertise of BNP Paribas Wealth Management seasoned team of dedicated Private Equity specialists.
- Gain a unique access to Private Equity funds normally reserved to institutional investors.
- Benefit from a tailored asset allocation of your wealth thanks to a selection of funds among the best performing Private Equity managers in the world.
- Leverage on an international team of experts who have a proven track record since 1998.