The last five years have been the best in the history of the private equity industry, but the same macroeconomic tailwinds that helped drive growth during this time also obscured the fact that many firms failed to achieve the margin goals they initially set out to achieve. As the industry moves into a new economic cycle, firms cannot rely on multiple expansion to deliver the returns investors demand. Those that have strong deal theses and plans for achieving value will emerge as the winners.
Bain and CEPRES recently collaborated on important research into how funds fared during the last downturn, including how various factors affected deal outcomes, how timing before, during and after the crisis affects returns, and which sectors and subsectors held up well (or fared poorly).
Moving forward, Bain and CEPRES will expand their joint research efforts and also develop ground-breaking products that will provide the private equity industry with powerful new capabilities to improve investment performance.