General Partner Persistence in European Private Equity

Abstract

This thesis investigates the persistence in General Partner performance in European private equity based on fund data between 1985 and 2023. We find strong evidence of persistence, particularly among the top and bottom performing managers. The findings remain when controlling for related fund characteristics and when using interim performance measures. Secondly, we conclude that higher performing General Partners are more likely to raise subsequent and larger funds. Lastly, our results suggest that skills and expertise of General Partners are plausible drivers of persistence, while consistent risk-taking or persistent luck are less likely explanations. These findings provide applicable insight to private equity investors' decision-making and pave the way for future research in private equity, especially on net asset valuations and persistent luck in General Partner performance.