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Private Equity Holds Record Levels of Dry Powder
AIC Trends Report Shows Dry Powder Levels Rose to $353 Billion as of December 2017

WASHINGTON – The U.S. private equity industry has amassed $353 billion of dry powder as of December 2017, according to the American Investment Council’s (AIC) 2018 Q2 Private Equity Trends Report, released today. This figure marks a 44 percent increase from the $245 billion of US-based callable capital reserves in December 2016.

Dry powder levels continue to hit historic levels and reflect the robust and fast-paced fundraising environment over the last few years,” said Bronwyn Bailey, AIC Vice President of Research and Investor Relations.

Despite record levels of dry powder, Q2-2018 saw total private equity investment drop to $41 billion, a 49 percent decline from this point last year. Prior to 2018, U.S. private equity investment had steadily increased since 2009. In addition, fundraising volumes fell to $19 billion, equity contributions remained level, and exit volumes decreased to $51 billion.

Investment volume in private equity slowed this quarter, a reversal of the upward trend we saw in almost every successive year over the last decade,” said Bailey. “With record levels of dry powder, fund managers are well-positioned to invest more capital in growing businesses and industries across the country.”

Below are key findings from the report. Read the full report here.

  1. U.S. PE Investment Volume Falls: U.S. private equity investment volume fell to $41 billion in Q2-2018 from $80 billion in Q2-2017.
  2. Equity Contributions Remain Level: Total equity financing for leveraged buyouts remained at 41.1 percent, the same level it was at the end of Q2-2017.
  3. U.S. Fundraising Falls: U.S. private equity fundraising volume fell to $19 billion, a 65 percent decrease from $55 billion in Q2-2017.
  4. Dry Powder Grows: Callable capital reserves of global buyout funds rose to $353 billion by December 2017, a 44 percent increase from $245 billion in December 2016.
  5. Exit Volumes Decrease: U.S. private equity exit volume fell to $51 billion, a 54 percent decrease from $110 billion in Q2-2017.