A clearer view of private equity: what matters now

Below, we answer the three questions we hear most often from clients and their advisors. The full paper goes considerably deeper: private equity’s performance drivers, detailed exhibits on manager return dispersion, the importance of a strong sourcing engine, the complexity of creating value in companies, and KKR's five decades of investing with conviction through different market cycles. Read the full piece here

1. Can private equity continue to outperform?

Yes, but choosing the right manager has never mattered more.

Private equity remains a long-duration asset class where returns are driven less by daily sentiment and more by a manager's ability to build real value over time. However, you have to choose the right manager to capture that outperformance.

Over the past 25 years, private equity has delivered roughly 4-5% of annualised net excess return over public equities. Yet the gap between top- and bottom-quartile managers runs over 1,400 basis points, versus about 300 in public markets¹. In other words, the who matters far more than the what.

Read the full paper to see how durable performance is delivered: we quantify the dispersion of performance, show how excess returns shift across different public-market regimes, and walk through the operational playbook in the context of a real portfolio-company transformation.

2. Are deals getting done?

Yes, for managers with well-fueled sourcing engines and the conviction to deploy through the cycle.

Deployment has recovered, with just over $900 billion invested industry wide in 2025. However, deal count fell, meaning activity remains uneven. Few managers have enough conviction amid the uncertainty to continue making new investments.

The full paper details where our deal flow really comes from, why less than a third of it relies on other sponsors, and the historical evidence that private equity's strongest excess returns arrive precisely when public markets are hardest.

3. Are managers still able to exit investments?

Yes, but selectively, and demand is strong for high-quality assets.

2025 was the second-best year ever for exits by dollar value, yet that figure was carried by a handful of megadeals, while the total number of exits fell and roughly $4 trillion of assets remain unsold across the industry. In this market, operational improvement has become an increasingly important driver of exits.

Explore the full paper to understand the shifting “buyout math” now reshaping the industry, our discipline around when to monetise, and why multiple exit pathways matter more than ever.

_{1 - Past performance is not indicative of future results.}

_{IMPORTANT INFORMATION}

_{This general discussion is presented for educational purposes only and should not be viewed as a current or past recommendation or a solicitation of an offer to buy or sell any securities or to adopt any investment strategy.}

_{Private investments are speculative and not suitable for all investors, nor do they represent a complete investment program. Private investments include numerous risks, including illiquidity risk, which means investments are typically required to be held for a period before they are eligible for redemption. Investors in private strategies may also realize higher fees, and some assets may have valuations which could be difficult to verify. There can be no assurance that any investment strategy will be successful.}

_{Copyright 2026 © Please consult www.kkr.com for further important disclosures. All rights reserved.}