NAIC Membership Profile
NAIC represents a vibrant and growing population of diverse-owned private equity firms and hedge funds, with a track record and ongoing performance that is competitive with the broader market. A growing number of institutional investors are allocating increased capital to our members as evidenced by frequent over subscription.
NAIC members cover the broad spectrum of diversity. People of color and women are in leadership positions at all NAIC member firms.
The NAIC is comprised of more than 185 member firms, including private equity (growth and buyout) firms, venture capital, private equity, real estate, funds of funds, hedge funds, and other strategies.
NAIC Member Fundraising
Since 2010, Annual Fundraising for NAIC Membership has grown 2,000%.
However, nearly half comes from public pension funds. This may likely be due to an increase in the number of emerging and diverse programs over the last five to seven years. Funds of funds and “other” investors, including insurance companies, foundations and government agencies, are the next two largest investor groups.
*2021 data as of April 1, 2021
NAIC Member Investments and Deals
NAIC represents a vibrant and growing population of diverse-owned private equity firms and hedge funds, with a track record and ongoing performance that is competitive with the broader market. In fact, in a recent study, upper quartile Diverse PE Funds in the NAIC Private Equity Index outperformed the upper quartile funds in both U.S. Buyout and U.S. Private Equity cohorts. Consequently, a growing number of institutional investors are allocating increased capital to our members as evidenced by frequent over subscription.
Between 2010 and 2022, dealflow through NAIC membership, in aggregate, has increased 731% (Figure 2).
Invested in Member
Employees at NAIC Member Portfolio Companies by State
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Total Employees: 554,688
Internationally, NAIC portfolio companies employ over 126,000 employees.
NAIC Member Firm Investments
NAIC members invest in companies that employ 554,688 in the United States and over 573,000 employees globally. Private equity allows these companies to grow, hire more staff, and create broader wealth distribution. NAIC member portfolio companies specialize in a wide range of industry sectors. These companies hire employees in healthcare, restaurants and hotels, retail, software and more. IntelligentNAIC has compiled a list of the Top 10 industry sectors where NAIC member firms have investments.
Global Employee Impact by Industry
NAIC Members have international investments that employ 19,000 employees internationally. *(All data as of August 12, 2022)
NAIC Member Performance and Analysis
For the period 1994 through 2018, diverse PE funds, represented by the NAIC Private Equity Index, recorded a net IRR of 18.96 percent, a net MOIC of 1.54x and DPI of 0.69x. For the continuous reporting period of 2011 to 2018, the NAIC Private Equity Index reported a net IRR of 20.99 percent, a net MOIC of 1.48x and a net DPI of 0.53x.
Implications for Investors
Diverse private equity managers have once again proven to be a fertile hunting ground for alpha generation. In addition, because returns are produced through diverse deal flow and thinking, it may be possible for investors in women- and diverse-led private equity funds to further diversify their investments, even within their private equity allocations.
NAIC Private Equity Index Versus Burgiss Median Quartile by Vintage Year
Research is the foundation for every investment decision and often helps drive investor behavior. The NAIC publishes studies that offer in-depth insight into the performance of diverse managers, the industries in which they invest and the benefits of instituting emerging manager programs.
2021 Performance Study
The 2021 NAIC Performance Study concluded that diverse managers again beat their benchmarks, including the Burgiss median, for net IRR, MOIC and DPI from 1998 to 2020 and from 2011 to 2020. Diverse managers – represented as The NAIC Private Equity Index – also posted higher net multiples on invested capital than the median Burgiss private equity fund.
The Managers in the Market (MINT) Report is a quarterly compendium of tear sheets for NAIC Member firms that are currently fundraising, have recently closed funds or have funds that are coming to market within the next twelve months. The MINT Report is widely distributed to a growing list of over 100 institutional investors nationwide and serves as a special resource for allocators seeking to invest with high-performing diverse managers. To request access to the distribution list, click below.
Since 2015, 27 diverse-owned firms have raised 54 oversubscribed funds, highlighting investor interest in our members’ investment strategies and their long standing track record in delivering superior returns for limited partners. The following are some of the recently oversubscribed funds that were raised by NAIC members:
NAIC Home Run Club
The NAIC Home Run Club recognizes deals completed by NAIC member firms that have returned at least 4X to their limited partners. This will be an ongoing tribute to those diverse managers who have generated superior return.