Chris Witkowsky

According to fresh research from Goldman Sachs, average distribution-to-paid-in multiples (DPI) for the 2019-22 vintage era is 80% lower than the equivalent 2007-14 vintage set.

As more GPs seek alternatives to traditional exit paths for their older investments, continuation funds have grown more popular for certain assets.

Driving activity was strengthening pricing, which was helped along by a stabilization in interest rates last year, along with an overall improvement in economic outlook.

Until some of the more inefficient aspects of the continuation fund process are smoothed out, these deals are not likely to become routine exit options alongside IPOs and strategic sales.

A disconnect exists in the industry between GPs who view continuation funds as a desirable way to hold certain assets beyond the limits of a traditional private equity fund, and LPs who generally would prefer a regular exit.

Opinions vary, and the real-world impacts of the rules are uncertain – lawyers are up in arms, while GPs are worried and dreaming of money flowing out of firms like a homeowner with a plumbing issue. 

In the wake of the most sweeping regulations since the financial crisis, Gensler was grilled this week by members of the Senate’s Banking, Housing and Urban Development committee about the new private fund rules.

For GPs with funds in the market, any extended fundraising delay could cause headaches as they have deadlines to meet, deals to close and employees to pay.

The promotions come as Lazard’s capital advisory group continues to expand. It has about 100 professionals in eight offices around the world with an expectation of continued growth.

The fund of funds platform, which includes commitments to venture funds as well as private credit, continues to operate.