Is destiny worth the distance? On private equity in emerging markets
Darolles, Serge Ain Tommar, Sara Jurczenko, Emmanuel
Darolles, Serge
Ain Tommar, Sara
Jurczenko, Emmanuel
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Working paper
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Supervisor
Publication Year
2018
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Book
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Publication NUmber of pages
52
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Abstract
We study the performance determinants of private equity investing in emerging markets (EM) compared to developed markets (DM) using a novel dataset. Using a multilevel linear model specification, our results suggest that performance in emerging markets in highly dependent on geographical and cultural proximity. The effect is significantly higher for GPs investing in both markets compared to pure DM- and EM-players respectively. Cross-cultural and geographical effects are enhanced when the GP investment teams are also culturally close using different measures. Our results also show that the realized returns are highly dependent on the investment period, the investment style and the GP’s experience on each market.
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Keywords
Private Equity Investing, Private Equity Performance, Emerging Markets