Private equity’s expanding exit playbook: why a slowdown in IPOs shouldn’t worry you

Group 1 - The private equity industry is often misunderstood, characterized as opaque and aggressive, but it is actually dynamic, collaborative, and increasingly transparent, focusing on long-term value creation [1] - Private equity provides stability and strategic guidance to investee companies, especially during turbulent times, offering a sense of security to investors compared to volatile public markets [2] - A common misconception is that IPOs are the primary exit route for private equity firms, whereas the reality is more complex [3] Group 2 - IPOs account for only a small share of private equity exits, typically 10-20% during strong bull markets, and in the past year, this figure has been even lower, with 90% of exits at HarbourVest Global Private Equity achieved through mergers and acquisitions [4] - Most exits occur through trade sales to corporates or sponsor-to-sponsor transactions, which provide liquidity while keeping the company private, making them efficient and predictable [5] - Continuation vehicles have emerged as a new exit route, allowing private equity managers to retain ownership of high-performing assets while providing liquidity options for investors [6] - The market for continuation fund transactions has significantly grown since 2022, exemplified by HarbourVest's investment in Froneri, which is undergoing a €3.6 billion capital injection [7]