2024 Hamilton Lane Market Overview: New Data Debunks Private Markets Myths

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[{"type":"text","content":"Report highlights findings around valuations, fundraising, GP-leds and sustainable investment returns\nCONSHOHOCKEN, Pa., March 7, 2024 /PRNewswire/ -- Hamilton Lane (Nasdaq: HLNE), a leading global private markets investment management firm, published its 2024 Market Overview today. This year's report offers a data-backed counter narrative to several commonly held misconceptions about the private markets asset class.\n\n \n \n \n \n \n \n\n \nThe firm's annual Market Overview is a comprehensive, data-driven review and analysis of private markets investment activity over the prior year, featuring predictions for the year ahead, underscored by Hamilton Lane's industry-leading database encompassing $18.9 trillion in assets and 52 vintage years.\nThe 2024 Market Overview addressed the following myths:\nMYTH: Private market valuations are inaccurate: It's not the first time private market valuations have been criticized, but this past year's skepticism toward how private markets value their holdings has been notable. There are a few reasons why we believe both the valuations are realistic and there is unlikely to be a downturn driven solely by inflated valuations today.MYTH: The fundraising market is bleak: To be clear, private markets fundraising indeed remains challenged, however, the overall picture is more nuanced, with 2023 shaping up to be the seventh-largest fundraising year in history. Also, Hamilton Lane's Private Wealth Survey showed that nearly 75% of respondents plan to increase their allocation from the prior year.MYTH: GP-led secondaries are terrible, and/or are just like co-investments (especially single-asset deals): Using a buyout index as a proxy for co-investments (CI), the data shows that while returns between single-asset GP-leds and co-investments are similar (with a slight advantage to CI), the risk profile is quite different. Single-asset GP-led secondaries historically have a tighter return band, and much lower loss ratios than co-investments.(See chart: \"Co-Investment\" vs. Single Asset Continuation Vehicles)MYTH: A focus on sustainability will ruin future returns: One of the most hotly-debated myths is that sustainable investments sacrifice performance, which at one point in time might have been a justified stance. As illustrated below, sustainable investment trailed behind non-sustainable investment for ...

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