What is the average return of private equity?
Unlike listed equities, whose value can be observed continuously, private equity performance materialises over the long term. It is therefore measured using specific indicators, foremost among them net IRR.
Net IRR, an important performance metric
Net Internal Rate of Return (IRR) is a key measure of performance in private equity. “Net” means the return actually received by investors after management fees and carried interest have been deducted. IRR incorporates the time value of money and the timing of cash flows, making it possible to compare investments with different holding periods, although it can also be influenced by early distributions.
Figures to the end of 2025: approximately 10.7% per year over ten years
According to the 32nd edition of the “Net Performance of French Private Equity Players” study published by France Invest and EY in June 2026, French private equity generated an average net IRR of 10.7% per year over ten years to the end of 2025 and 10.8% since inception. Funds raised since 2008 and fully realised generated a net IRR of 14.6% and a multiple of 1.91x. At the end of 2025, ten-year performance was lower than at the end of 2024, against a more challenging economic and financial backdrop , while remaining at a high level.
Performance above public equity markets
Over the ten years to the end of 2025, French private equity generated a net IRR of 10.7%, compared with 9.5% for the CAC 40, 8.9% for the CAC All Tradable and 5.5% for the CAC Mid & Small, according to the Public Market Equivalent (PME) methodology used by France Invest / EY.
| Asset class | Annualised return over 10 years to the end of 2025 |
|---|---|
| French private equity — net IRR | 10.7% |
| CAC 40 | 9.5% |
| CAC All Tradable | 8.9% |
| CAC Mid & Small | 5.5% |
| Fully realised PE funds — 2008+ vintages | 14.6% |
Source: France Invest / EY, “Net Performance of French Private Equity Players”, 32nd edition, June 2026 — data to the end of 2025. Comparisons with public equity markets calculated using the PME methodology.
📌 Key takeaways
- Net IRR for French private equity: approximately 10.7% per year over 10 years to the end of 2025.
- Historical performance above that of the CAC 40 over the same period under the PME methodology.
- But averages do not tell the whole story: performance remains highly dependent on the strategy, vintage and fund selected.
Private equity returns by strategy
Behind the broad term private equity are strategies with different risk and return profiles. Strategy, vintage and the market environment all play an important role in observed performance.
Buyout (LBO)
Buyout strategies, or LBOs, generally target mature and profitable companies. Over the ten years to the end of 2025, this strategy generated a net IRR of 13.1% and a multiple of 1.51x, according to the France Invest / EY study.
Infrastructure and growth capital
Infrastructure strategies invest in assets related to sectors such as energy, transport and digital infrastructure. Growth capital, meanwhile, supports established companies in financing and accelerating their growth plans.
At the end of 2025, their respective ten-year net IRRs stood at 10.2% for infrastructure and 9.2% for growth capital.
Venture capital: high potential, but significant dispersion
Venture capital finances young, innovative companies. Some investments may generate very high multiples, while others can result in a significant or even total loss of invested capital.
Its average ten-year net IRR stood at 6.5% at the end of 2025, with significant dispersion across funds.
Secondaries and private debt
Secondary strategies involve, among other approaches, acquiring interests in existing funds. They can provide greater visibility into the underlying assets and help mitigate certain effects of the J-curve.
Private debt, meanwhile, offers risk and return profiles that differ from traditional private equity. To explore this topic further, read our guide to private debt .
| Strategy | 10-year net IRR | Multiple |
|---|---|---|
| Buyout | 13.1% | 1.51x |
| Infrastructure | 10.2% | 1.32x |
| Growth capital | 9.2% | 1.35x |
| Venture & growth | 6.5% | 1.27x |
| Total private equity | 10.7% | 1.41x |
Source: France Invest / EY, “Net Performance of French Private Equity Players”, 32nd edition, June 2026 — data to the end of 2025.
Performance dispersion: the key issue
Significant differences across funds
A market average does not necessarily reflect the performance achieved by an individual investor. Results can differ significantly depending on the asset manager, strategy, vintage and companies held within the portfolio.
Two investors with exposure to private equity can therefore experience very different outcomes depending on the funds selected.
Why fund selection matters
Unlike public equity markets, investors cannot simply buy an index representing the entire private equity market. Investing requires the selection of specific funds and managers.
The team’s track record and stability, investment strategy, valuation discipline, sourcing capabilities and ability to create operational value are therefore important elements of the investment analysis.
Diversification to reduce concentration risk
Concentrating an allocation across a limited number of funds increases exposure to manager-specific and vintage-specific risks.
Diversification across multiple managers, strategies, geographies and investment years can help spread these risks more effectively.
How is private equity performance measured?
IRR alone is not sufficient. A fund’s performance should be assessed using several complementary metrics.
IRR, TVPI, DPI and MOIC: key metrics
TVPI measures the total value created, both realised and unrealised, relative to invested capital. DPI measures the proportion of capital already distributed to investors. RVPI represents the residual value of the portfolio, while MOIC measures the multiple generated on invested capital.
Each metric provides a different perspective: DPI shows the amount actually distributed, TVPI reflects the total value of the portfolio, and IRR measures the rate at which that value has been created.
To learn more: how should the performance of a private equity investment be measured?
The J-curve: returns are often negative in the early years
At the beginning of a fund’s life, fees and capital calls generally occur before portfolio companies have had sufficient time to create value or be exited.
This dynamic can produce a J-curve , which is characteristic of many private equity funds.
Factors influencing returns
Private equity performance depends on factors including entry valuations, financing costs, the economic environment, transaction activity and exit conditions.
Periods of high valuations can increase acquisition prices, while a slowdown in exit markets can extend holding periods and delay distributions.
However, the market environment is only part of the equation. The quality of the assets selected, the price paid, operational value creation and the manager’s ability to execute exits remain critical.
How can investors access private equity performance?
Direct access to institutional private equity funds may require substantial minimum commitments.
Private Corner, a French asset management company authorised by the AMF under number GP-20000038, structures vehicles that enable private wealth management professionals and their clients to access a range of private assets strategies.
The assessment of investment opportunities includes the analysis of the teams’ track records, their stability, the strategy, alignment of interests and portfolio characteristics.
Conclusion
At the end of 2025, French private equity generated a net IRR of 10.7% per year over ten years, according to France Invest / EY. Funds raised since 2008 and fully realised generated a net IRR of 14.6% and a multiple of 1.91x.
These historical averages do not, however, reflect the performance of every fund. Differences across strategies, vintages and managers can be significant. Fund selection and diversification therefore remain essential when constructing a private equity allocation.
For private investors, one of the key considerations is how to access these strategies through suitable investment vehicles .
Source of performance data: France Invest / EY, “Net Performance of French Private Equity Players”, 32nd edition, June 2026 — data to the end of 2025.
Disclaimer. This content is provided for informational and educational purposes only. It does not constitute investment advice, a personalised recommendation or an offer to subscribe. The figures cited are taken from the France Invest / EY study published in June 2026 and relate to performance to the end of 2025. They represent historical data and market averages and are not indicative of the performance of any particular fund. Past performance is not indicative of future performance. Investing in private equity involves, among other risks, the risk of partial or total loss of invested capital and liquidity risk. Before making any investment, investors should review the fund’s regulatory documentation and assess whether the investment is appropriate for their circumstances and objectives.
FAQ
What is the average return of private equity?
At the end of 2025, French private equity generated a net IRR of approximately 10.7% per year over ten years. Funds raised since 2008 and fully realised generated a net IRR of 14.6%, according to France Invest / EY.
Why did private equity returns decline in 2025?
France Invest / EY recorded a decline in returns between 2024 and 2025 against a more challenging economic and financial backdrop. The ten-year net IRR nevertheless remained at 10.7% at the end of 2025.
Which private equity strategy has delivered the strongest historical performance?
Performance varies across periods and vintages. Over the ten years to the end of 2025, buyout funds, for example, generated a net IRR of 13.1% according to France Invest / EY data.
Has private equity historically outperformed public equity markets?
Over the ten years to the end of 2025, France Invest / EY measured a net IRR of 10.7% for French private equity compared with 9.5% for the CAC 40 under the PME methodology. These historical figures are not indicative of future performance.
How can private investors access private equity?
Access can be provided through dedicated investment vehicles distributed by private wealth management professionals. Private Corner structures and distributes a range of solutions providing access to private assets strategies.
