Public equity markets have rebounded a full two years after hitting their financial crisis lows, but private equity is still stuck in a lull.
Although confidence is way up and funds are out bidding again, fundraising hasn't picked up much traction. Early first quarter numbers are out and the 92 private equity funds that closed around the world closed from January to March brought in $42.3-billion (U.S.). That's the lowest total since 2003, according to Preqin, which tracks private equity funds.
However, there is some hope on the horizon. Another 110 funds held an interim close last quarter, raising $26.3-billion in total toward their overall targets.
To compare these numbers with the 'glory days' back in 2007 and 2008, total private equity fundraising used to hit between $125-to-$200-billion on a quarterly basis.
Moreover, fundraising continues to eat up a lot of time. For the funds that closed last quarter, average marketing time was 16 months. That's much better than the 20 month average in 2010, but still far off the 10.6 months average in 2005.
At the moment fundraising is dominated by buyout funds, which are followed by venture funds.
Two of the biggest funds that closed last quarter came from Canada. Birch Hill closed their Fund IV, worth $1.04-billion, and Catalyst Capital closed their Fund III, raising $1-billion (U.S.)
The biggest fund worldwide was EnCap Investments' EnCap Energy Capital Fund VIII, worth $3.5-billion.