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PE healthcare slump: Q1 PE deal volume in healthcare services fell to a low since 2020. Our new research breaks down sector performance, standout deals, and the impact of changing market conditions. Read it here.
Comp sheets: The last of our Q1 guides on key trends in public company valuations and financials are here: agtech, enterprise SaaS, medtech, and mobility tech. |
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A message from Fidelity Private SharesSM
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Raise the bar on fundraising
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PitchBook and Fidelity Private Shares LLC are not affiliated. |
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What volatility means for private fund NAVs
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The sharp spike in market volatility following President Trump's tariff announcement on April 2 rattled public markets—but its effects have yet to show up in private fund valuations.
Due to the lag inherent in private fund reporting, Q1 NAVs will reflect little of the recent dislocation, and LPs may not see the true impact until the end of Q2 or later.
To bridge this gap, PitchBook's Private Capital Return Barometers provide a near real-time view into private market conditions.
As of April 8, nowcasted returns turned decisively negative across most private strategies: PE (-2.7%), VC (-3.3%), private credit (-2.0%), and natural resources (-5.0%), with desmoothed figures showing even deeper declines—VC, for example, at -8.3%.
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| Click for a bigger version of this chart on implied returns. |
Public equity proxies support these signals and suggest even greater markdowns. The Morningstar PitchBook Buyout Replication Index, designed to track public companies with buyout-like characteristics, declined 12.7% unlevered and 20.4% levered between April 2 and April 8.
These moves suggest mounting pressure on private valuations and challenging exit conditions.
Meanwhile, our VC-Backed IPO Index, which tracks post-listing performance of venture-backed companies, was down 30% YTD as of April 3, underscoring the continued fragility of the late-stage VC and public listing environment.
With macro volatility persisting and asset prices under pressure, the exit environment remains constrained, further limiting liquidity for LPs and prolonging the wait for distributions.
Until conditions stabilize, real-time tools like Barometers and public indexes offer a critical lens into fast-moving developments that NAVs will take quarters to fully reflect.
Read more in our free analyst note: What Volatility Means for Private Fund NAVs
Clients can access prior editions of our LP-focused weekly commentary in this dedicated workspace.
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Sustainable investors focus on materiality, merit, opportunity
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Just a couple of years ago, private fund managers were jumping at the chance to make public pledges to integrate ESG analysis into their investment processes, highlight how they incorporate DEI considerations into their hiring and investment decision-making, and capitalize on opportunities in the climate and energy transition spaces.
Much has changed.
In the US, LPs and GPs fear litigation due to their ESG and DEI programs.
Government funding supporting renewable and low-carbon energy development has been rolled back.
The Trump Administration's pro-fossil fuel stance is expected to make it more challenging for alternative energies to compete with oil & gas producers.
Additionally, economic uncertainty created by rapidly changing trade policies has pulled focus and resources away from sustainability and toward the navigation of these uncharted waters.
Against this backdrop, some have said that ESG, DEI, and other realms of sustainable investment are dead. However, large segments of the market disagree.
In Europe and other parts of the world, analysis and mitigation of material ESG risks is still table stakes.
In the US, many believe that there is much more work to be done on the DEI front, particularly in the private markets, and data supports this view. Despite litigation risk, some are actively seeking ways to persevere with their programs, focusing on proving that DEI and merit are not only compatible but complementary.
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| Fundraising has slowed, but a lot of capital has been raised. |
Furthermore, even amid a broader fundraising slowdown, climate PE and energy transition infrastructure specialists investing exclusively in climate and transition-related assets raised $148 billion from 2022 to 2024. When including funds with a broader mandate that invest to some degree in these spaces, the number shoots to $420 billion.
While not immune to the macro and sector-specific headwinds these funds face, investors still see financial and Impact opportunity in spite of—and sometimes even because of—the retraction in government support.
For more data and analysis on how ESG, DEI, Impact investing, and other sustainable investing topics are evolving, read our new analyst note: The State of Sustainable Investing in the Private Markets
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