mcp Annual Investor Survey 2024

About the 2024 Survey

Despite rising geopolitical tensions and amidst a resilient macro environment, private equity allocations remain strong, underpinning the ongoing attractiveness of the asset class. The results of mcp’s 12^th Annual Investor Survey point to a positive future for the private equity asset class, with continued strong investor appetite and an improved outlook on valuations relative to last year.

The report captures the views of private equity investors around the world – offering insights into their investment strategies and preferences as they navigate the current market environment.

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Key Survey Findings

Private Equity Allocations Remain High

30% of institutional investors now allocate more than 15% of their portfolio to the asset class, compared to 23% last year.
Institutional investors are increasing their allocation to secondaries: 13% allocate more than 25% of their private equity allocation to secondaries, a 5% increase vs. last year

Geopolitical Tensions Top Concern

Last year, an economic recession was the #1 concern for investors.
This year, 41% of respondents selected geopolitical tensions as their main concern regarding market activity over the next 12 months
These results against the backdrop of the ongoing war between Ukraine and Russia, escalating tensions in the Middle East, and the mounting trade conflict between the U.S. and China.

Private Equity Buyout Multiples Stable

Three quarters of respondents believe PE multiples will remain flat at current levels (58% of respondents) or trend higher by one to two EBITDA turns (16% of respondents)
One quarter of respondents expect a decrease in PE multiples.
This is in stark contrast to last year’s results, where more than half of investors expected multiples to decrease.

SPECIALIST SECONDARY FUNDS NOT A PRIORITY

35% of investors prefer investing in generalist secondaries funds, allowing them to capture the benefits of both GP-led and LP-led transactions within the same fund.
Only 19% of investors prefers investing in secondaries via a specialist fund (LP or GP-led).
At the same time, specialization of investment teams around either transaction type was selected as a key priority by respondents for secondaries firms in the near term

*All information based on the mcp Annual Investor Survey released in November 2024.

About the 2024 Survey

Key Survey Findings

Private Equity Allocations Remain High

30% of institutional investors now allocate more than 15% of their portfolio to the asset class, compared to 23% last year.

Institutional investors are increasing their allocation to secondaries: 13% allocate more than 25% of their private equity allocation to secondaries, a 5% increase vs. last year

Geopolitical Tensions Top Concern

Last year, an economic recession was the #1 concern for investors.

This year, 41% of respondents selected geopolitical tensions as their main concern regarding market activity over the next 12 months

These results against the backdrop of the ongoing war between Ukraine and Russia, escalating tensions in the Middle East, and the mounting trade conflict between the U.S. and China.

Private Equity Buyout Multiples Stable

Three quarters of respondents believe PE multiples will remain flat at current levels (58% of respondents) or trend higher by one to two EBITDA turns (16% of respondents)

One quarter of respondents expect a decrease in PE multiples.

This is in stark contrast to last year’s results, where more than half of investors expected multiples to decrease.

SPECIALIST SECONDARY FUNDS NOT A PRIORITY

35% of investors prefer investing in generalist secondaries funds, allowing them to capture the benefits of both GP-led and LP-led transactions within the same fund.

Only 19% of investors prefers investing in secondaries via a specialist fund (LP or GP-led).

At the same time, specialization of investment teams around either transaction type was selected as a key priority by respondents for secondaries firms in the near term