PE Program Fund Performance Review

Since inception in 1990 to September 30, 2012, the Private Equity (PE) Program has generated $21.7 billion in profits for CalPERS. Given the young, weighted-average age of the portfolio (6.4 years) this amount will continue to grow as the portfolio matures.

All information on this page is as of September 30, 2012.

September 30, 2012 is the latest private equity performance information available. At the end of each quarter, the General Partners report on the value of invested capital. They have up to 120 days to provide Limited Partners with financial data, so there is generally a two-quarter "lag" in performance reporting.

How to Read the Performance Review Table
The table, which is updated quarterly, provides information on the status of the CalPERS private equity commitments. The left-hand column lists all funds to which CalPERS has committed capital. The column "Capital Committed" identifies the original amount CalPERS agreed to invest in each fund. "Cash In" represents capital contributed for investments and management fees. "Cash Out" represents distributions CalPERS has received back from the fund.

Reported performance may reflect a variety of factors. One fund may be in the formative stage when management fees have a larger negative impact on results in the initial years (see our Private Equity Performance Review section that discusses the J-Curve Effect). Another fund may be realizing investments in some companies and distributing the proceeds to investors. Performance may also be influenced by the performance cycle within industries or the strategies in which funds invest, such as technology versus manufacturing, or venture capital versus buyout. There are no generally accepted standards, practices, or policies for reporting private equity valuations. Generally, private equity partnerships take 10 to 12 years to realize full value. Most General Partners tend to have a conservative valuation approach, and as a result interim reported values could differ materially from the values realized when portfolio companies are sold. For these reasons it is not always meaningful to compare the interim returns or multiples for funds, particularly for funds of different vintage years or investment strategies.

In evaluating private equity performance, CalPERS emphasizes using both the realized IRR along with "Cash Out & Remaining Value" divided by the Cash In. Interim IRRs by themselves are not the best indicators of how a fund is performing or how it will perform over its full life.

Note: The table below reflects the performance of all active PE partnership investments as of September 30, 2012.  The table does not include any exited partnership investments. The reported value figures shown are representative of CalPERS' position in each investment. For funds formed during or after a vintage year of 2008, the investment multiple was noted as "N/M" which means Not Meaningful. Industry practice dictates that these funds are in the early stages of their investment life cycle and any performance analysis done on these funds would not generate meaningful results as private equity funds are understood to be long-term investments. It is strongly advised that you review our information on the J-Curve Effect: Earning Acceptable Returns under the Private Equity Performance Review area for detailed explanation. The term "N/A" means Not Available. Partnership investments ending with a 1 are using cash adjusted market values.

N/M    Internal rates of return (IRR) and multiples are not meaningful in the early years of a fund nor are they indicative of future performance.

On a quarterly basis, The PrivateEdge Group at State Street Corporation provides CalPERS with a summary of the PE portfolio, which is based on cash flow data and activity data that is provided by The PrivateEdge Group, Grove Street Advisors, and various PE program external resources and staff.

Figures in the table will not aggregate to the amounts listed in the Private Equity Performance Review in the Current External Private Equity Managers area since that review contains additional investments, including direct investments in private companies. As a result of confidentiality agreements, CalPERS does not disclose the identity of companies or individual portfolio company performance figures. These agreements may be required by certain investors or by the fund manager to maximize returns by protecting a competitive advantage in identifying, analyzing, investing, and exiting businesses. Compliance with the confidentiality agreement is a condition of investing in private equity funds.