The private equity industry has long been subject to misconceptions. To some, it’s a shadowy corner of finance — opaque, aggressive, and inaccessible. But this caricature misses the mark. In reality, private equity is a dynamic, collaborative and increasingly transparent industry, built on deep sector expertise, operational rigour, and long-term value creation.
At its best, private equity offers investee companies stability and strategic guidance, especially in turbulent times. Over the past year, as trade tariffs and geopolitical tensions rattled public markets, many companies found refuge in private ownership. For investors, too, private equity can offer a sense of security. Unlike public markets, which are prone to volatility and sentiment swings, private equity investments are held with solid conviction, and are actively managed by teams with deep domain knowledge and a long-term horizon.
Yet even as the industry matures, myths persist — particularly around how private equity firms realise value. One of the most enduring misconceptions is that IPOs are the primary, or even the preferred, exit route. The truth is far more nuanced.
IPOs: The Exception, Not the Rule
While IPOs dominate headlines and often capture investor attention, particularly when activity slows, they account for only a small share of private equity exits. Even during strong bull markets, public listings typically account for just 10 – 20% of exit activity by value at best. In the past year, that figure has been even lower. At HarbourVest Global Private Equity (HVPE), 90% of exits we achieved were through mergers and acquisitions (M&A), not IPOs.
