Key Takeaways
- • US private equity AUM reached $3.128 trillion as of September 2024, the highest level since December 2020, reflecting sustained growth across the sector over the past five years.
- • Between 2022 and 2023, 37 SEC-registered US private equity and venture capital firms more than doubled their AUM, with a median growth rate of 8%, signaling accelerated expansion among mid-market and emerging managers.
- • One Madison Group LLC demonstrated exceptional growth with a 3,119% increase in AUM, expanding from $189 million in 2022 to $6.08 billion in 2023, including a separately managed account worth $6 billion disclosed in April 2024.
- • Structural incentives embedded in buyout fund models—particularly fee-based compensation tied to AUM—drive aggressive growth targets, with 100% AUM expansion over three years described as "extreme but structural" by HEC Paris Business School professor Oliver Gottschalg.
- • Median AUM for fast-growing firms stabilized at approximately $946 million in 2023 versus $954 million in 2022, with most high-growth firms originally operating below the $1 billion threshold prior to expansion.
Summary
US private equity assets under management reached a post-pandemic peak of $3.128 trillion as of September 2024, according to S&P Global Market Intelligence data. This milestone represents the sector's highest AUM level since December 2020 and underscores sustained recovery and expansion in the American private equity market following pandemic-era volatility.
The growth trajectory accelerated notably among emerging and mid-market managers. Between 2022 and 2023, 37 SEC-registered US private equity and venture capital firms achieved AUM greater than 100% growth, with a median expansion rate of 8% across the cohort. The majority of these firms operated below $1 billion in AUM during 2022, with notable exceptions including CIVC Partners LP, Aquarian Holdings Investment Management LLC, and Multicoin Capital Management LLC, which entered the analysis period with larger asset bases.
One Madison Group LLC emerged as the standout growth performer, expanding AUM from $189 million in 2022 to $6.08 billion in 2023—a 3,119% increase. The firm, which focuses on industrials, consumer discretionary, and consumer staples sectors, subsequently reported a separately managed account valued at $6 billion in its Form ADV filing submitted in April 2024. This exceptional expansion exemplifies opportunities for specialized managers targeting specific subsectors within the private equity landscape.
The structural incentives driving such aggressive growth were articulated by Oliver Gottschalg, professor at HEC Paris Business School and researcher specializing in middle-market private equity performance. According to Gottschalg, fee-based compensation models create powerful economic incentives for AUM expansion, as firms generate revenue through management fees charged on assets under management independent of investment performance. While 100% AUM growth over three years represents an extreme outcome, such targets constitute standard structural features embedded within buyout fund agreements and GP compensation frameworks.
The growth trajectory accelerated notably among emerging and mid-market managers. Between 2022 and 2023, 37 SEC-registered US private equity and venture capital firms achieved AUM greater than 100% growth, with a median expansion rate of 8% across the cohort. The majority of these firms operated below $1 billion in AUM during 2022, with notable exceptions including CIVC Partners LP, Aquarian Holdings Investment Management LLC, and Multicoin Capital Management LLC, which entered the analysis period with larger asset bases.
One Madison Group LLC emerged as the standout growth performer, expanding AUM from $189 million in 2022 to $6.08 billion in 2023—a 3,119% increase. The firm, which focuses on industrials, consumer discretionary, and consumer staples sectors, subsequently reported a separately managed account valued at $6 billion in its Form ADV filing submitted in April 2024. This exceptional expansion exemplifies opportunities for specialized managers targeting specific subsectors within the private equity landscape.
The structural incentives driving such aggressive growth were articulated by Oliver Gottschalg, professor at HEC Paris Business School and researcher specializing in middle-market private equity performance. According to Gottschalg, fee-based compensation models create powerful economic incentives for AUM expansion, as firms generate revenue through management fees charged on assets under management independent of investment performance. While 100% AUM growth over three years represents an extreme outcome, such targets constitute standard structural features embedded within buyout fund agreements and GP compensation frameworks.
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