Giants at the gate : Investment returns and diseconomies of scale in private equity

@inproceedings{LopezdeSilanes2012GiantsAT,
  title={Giants at the gate : Investment returns and diseconomies of scale in private equity},
  author={Florencio Lopez-de-Silanes and Ludovic Phalippou and Oliver Gottschalg},
  year={2012}
}
  • Florencio Lopez-de-Silanes, Ludovic Phalippou, Oliver Gottschalg
  • Published 2012
We examine the determinants of private equity returns using a newly constructed database of 7,500 investments worldwide over forty years. One in ten investments does not return any money, whereas one in four has an IRR above 50%. Performance does not appear scalable: investments held by private equity firms at times of a high number of other simultaneous investments underperform substantially. The median IRR is 33% in the lowest scale decile and 14% in the highest. Results survive multiple… CONTINUE READING
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