Performance and Public Market Equivalent Report 2021

This report has been produced by the British Private Equity and Venture Capital Association (“BVCA”) to demonstrate the returns generated for investors by our members to 31 December 2021 and to compare these returns to equivalent investments in the public equity markets – using the FTSE All Share Total Return Index and MSCI Europe Gross Total Return Index as the benchmarks.

The performance statistics in this report are taken from the BVCA’s Performance Measurement Survey, an annual survey of fund level cash flows and valuations collected from our members. The public market equivalent analysis uses the same underlying data set.

With a significant presence in the UK, developed over the past 40 years, private equity and venture capital investments provide companies with the finance and know-how to deliver sustainable business growth. Active ownership, over the medium to long term, delivers economic and social value to those involved in the businesses (from employees, management and owners on the one hand, to customers and suppliers on the other) and a wide group of stakeholders (from local communities and local and regional economies, to national policy makers focused on issues such as climate change, diversity and inclusion and social issues).

Both private equity and venture capital firms are focused on delivering sustainable growth for the companies in which they invest: venture capital funds typically support early stage and younger companies, holding minority stakes in the businesses, while private equity funds typically acquire controlling stakes in more established businesses.

The Performance Measurement Survey (PMS) looks at funds which invest in businesses at all stages of the growth lifecycle – from venture capital funds specialising in start-ups to large buyout funds investing in global corporations. We at the BVCA firmly believe that our asset class offers exciting investment opportunities for pension schemes and other investors and the results of the Performance Measurement Survey and this Public Market Equivalent analysis show us why.

For the 2021 Performance Measurement Survey, we received responses from 114 members out of a total eligible pool of 164 members, a response rate of 70%. For comparison, in 2020 we received response from 119 members out of a total of 158 who were eligible. The full Performance Measurement Survey Report is available to read here and a shorter highlights paper can be found here.

This report uses the data collected for the 2021 Performance Measurement Survey and applies two main Public Market Equivalent (‘PME’) methodologies to compare the performance of the private equity and venture capital funds in our database to public equity markets, specifically the FTSE All-Share Total Return Index and the MSCI Europe Gross Total Return Index.