Many institutional investors have increased their allocations to private markets in recent years. The asset class is attractive because it has delivered high returns while having much less realized volatility than equities or fixed income. The combination of market-beating returns with diminished volatility is an alluring one, and it’s no surprise that these strategies are attracting more capital.
How Private Equity Works
Private equity firms can generate these returns due to their differentiated business models. Instead of investing in individual stocks or corporate bonds, PE shops buy entire companies. By improving operations and maximizing performance, private equity can add value and make the company worth more. The operator then typically seeks to monetize gains by selling the firm or engaging in an initial public offering (IPO).
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With the rush of institutional funds into private equity strategies, competition is rising. Which PE firms are standing above the rest of the pack? An organization named Private Equity International releases its PEI 300 list of the largest PE firms worldwide annually to answer this question.
The latest PEI 300 report came out in June and covers data through March 2024. The list adds up all the capital raised between 2019 and 2023, covering a broad time frame, including the pandemic and the subsequent economic reopening period. It took a minimum of $2.3 billion to earn a spot in this year’s top 300 rankings, and more than $50 billion to secure a place in the top 10. Here are the latest rankings:
| Private Equity Firm | Money Raised Over Five Years |
| 1. Blackstone Inc. (ticker: BX) | $124 billion |
| 2. KKR & Co. Inc. (KKR) | $103.2 billion |
| 3. EQT AB (OTC: EQBBF) | $99.1 billion |
| 4. CVC Capital Partners PLC (CVCA.XD) | $77.6 billion |
| 5. TPG Inc. (TPG) | $61.9 billion |
| 6. Carlyle Group Inc. (CG) | $60.2 billion |
| 7. Thoma Bravo LP | $59.1 billion |
| 8. Advent International LP | $52.9 billion |
| 9. Warburg Pincus LLC | $51.7 billion |
| 10. Hg | $51.4 billion |
Blackstone Inc. (BX)
After a rare stop at No. 2 in 2022, Blackstone has managed to secure its usual spot atop the list in both 2023 and now 2024. However, Blackstone’s total haul slipped to $124 billion for this latest ranking, falling slightly from last year’s $125.6 billion. This reflects the more challenging market conditions for some of the leading private equity shops amid rising competition and the high interest rate environment.
Regardless, Blackstone remains absolutely massive, with more than $1 trillion in assets under management (AUM), and public market investors can also enjoy the ride. Blackstone’s stock is publicly traded, and BX shares have risen about 190% over the past five years.
KKR & Co. Inc. (KKR)
KKR managed to top the PEI 300 list in 2022, briefly disrupting Blackstone’s time at the peak. Though KKR was unable to maintain its top billing, it held onto the No. 2 ranking this year. KKR grew its total AUM to $553 billion as of year-end 2023. Its total fundraising haul remained flat year over year, with it funding $103 billion in deals over the past five years. It is able to achieve such consistency due to its outsized returns; since 1976, KKR has achieved cumulative gross internal rates of return of more than 25% annually. That is more than double the S&P 500’s long-term compound annual growth rate, which is about 10%.
EQT AB (OTC: EQBBF)
After leaping from No. 6 to No. 3 in 2022, EQT has held onto that spot in the subsequent two editions of the ranking. From Stockholm, EQT has built an impressive multinational footprint. Most recently, it’s been expanding its exposure in fast-growing Asian markets, such as with its $7.5 billion acquisition of Baring Private Equity Asia in 2022.
After a rough 2023, EQT’s publicly traded shares have enjoyed a massive recovery. The company’s over-the-counter U.S. ticker has risen about 60% over the past 12 months. That’s an impressive result. And if Asian market activity picks up steam, EQT could make a push to overtake KKR and even Blackstone in the coming years.
CVC Capital Partners PLC (CVCA.XD)
CVC Capital Partners was this year’s biggest surprise in the private equity space. It shot up the ranking table from No. 15 to the fourth spot this year. With about $210 billion in AUM, CVC is a sizable outfit and it packed a huge fundraising punch over the past year.
CVC also enjoyed another milestone, with the successful listing of its stock on the Euronext Amsterdam exchange in April. The company is a whirlwind of deals. Just this summer, it has been in talks to sell a leading cricket sports franchise while taking a leading stake in a European pet food maker and offering to acquire a Polish software company. Time will tell if this momentum can lift CVC further up the power rankings in 2025.
TPG Inc. (TPG)
TPG was another private equity shop that climbed the list this year. The technology-focused firm entered the top 10 in 2023 and rose further to No. 5 in the latest edition of the rankings. Founded in 1992, TPG is growing quickly while taking advantage of the numerous opportunities in Silicon Valley and other leading software and technology areas. In May, TPG successfully closed its eighth Asia flagship fund, raising $5.3 billion. TPG is currently a leader in decarbonization-themed investments, and fast-moving developments in other growth areas like artificial intelligence and semiconductors could further bolster its prospects.
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Carlyle Group Inc. (CG)
Carlyle Group slipped a spot in this year’s ranking. The company is focused on Washington, D.C. and specializes in firms that service federal agencies. This includes industries such as aerospace, health care and media.
While Carlyle Group didn’t have the biggest fundraising wins in the industry this year, investors are upbeat. CG stock has rallied about 32% over the past 12 months. This could be tied to optimism around the upcoming presidential election, as a new administration may bolster spending and provide a tailwind for a variety of Carlyle’s businesses. Despite the rally, Carlyle shares remain in value territory, selling for 12 times forward earnings while offering a 3% dividend yield.
Thoma Bravo LP
Thoma Bravo is an American private equity firm that focuses on the tech sector. In particular, Thoma Bravo is a feared merger and acquisition player in the software space, as it is known for swooping in and buying firms at discounted prices. Thoma Bravo was highly active during the 2022 software market downturn, buying out Medallia, Anaplan, SailPoint and Coupa. And in April 2024, it announced plans to buy DarkTrace PLC, adding a big cybersecurity firm to its portfolio. All five of these were deals worth at least $5 billion, which speaks to Thoma Bravo’s ability to put large sums of money to work when opportunities arise.
Not all of Thoma Bravo’s deals work out. In 2021, for example, the company invested a reported $125 million into the cryptocurrency exchange FTX, which would go on to fail in dramatic fashion. But that comes with the territory of investing in cutting-edge technology. On the whole, Thoma Bravo has made several tremendous deals, giving it access to a continuous stream of investor capital, including its Fund XVI, which is reportedly on pace to raise $20 billion by year-end.
Advent International LP
Advent International was founded in 1984 as a spin-off from another investment management firm. Based in Boston, it is known for its large international footprint and being an active dealmaker in regions such as Eastern Europe and Latin America that are less-common stomping grounds for American PE shops.
Advent was in the news with its noteworthy $6.4 billion acquisition of Maxar Technologies in 2023. This builds on Advent’s proven expertise in the defense and security businesses. After entering the top 10 in 2023, Advent slipped a spot in the rankings this year. But given the unsettled geopolitical scene, Advent could be set to resume its climb in 2025.
Warburg Pincus LLC
After re-entering the top 10 at No. 10 last year, Warburg Pincus climbed another spot for the 2024 rankings. The company has a long history, with its private equity business running since 1966, and the company can trace its original roots back to Eric Warburg’s New York City banking business founded in 1939.
The firm has a storied history within the capital markets. Warburg Pincus has led more than 140 of its portfolio companies to successful IPOs over the years across more than a dozen different global stock markets. The company has a contrarian streak and has been willing to invest in out-of-favor sectors such as energy to maintain steady deal flow.
Hg
Slipping two spots this year, Hg rounds out the list at the No. 10 spot. Based in London, Hg is one of the largest European private equity firms out there. To that point, in 2020, Hg orchestrated the buyout of software company Visma. At the time, the $12.2 billion deal was the largest European software buyout in history.
Hg was founded in 1990, but only became fully independent in 2000, making it one of the youngest firms on this list. It also has about $70 billion in total AUM, making it one of the smaller overall players in the top 10. But it has been able to raise a prodigious quantity of funds given its dealmaking in hot sectors and strong returns for its investors.
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The Top 10 Largest Private Equity Firms in the World originally appeared on usnews.com
Update 07/24/24: This story was previously published at an earlier date and has been updated with new information.
