Time to engage – or fade away. What all owners should learn from the shakeout in private equityp

In December 2008, we predicted a significant shakeout in the private equity industry leading to the disappearance of 20 to 40 per cent of private equity firms. Since then, several private equity firms have gone out of business, some have reduced their current fund commitments, and others have reduced their teams, including senior partners. In July 2009, we forecast that private equity’s limited partners would - on average, but with significant variation - stay committed to this asset class or even increase their allocation relative to other asset classes. In the past six months, limited partners have indicated that they are willing to commit new funds and in fact have done so, write Heino Meerkatt and Heinrich Liechtenstein of the Boston Consulting Group and IESE Business School.