In this final installment of our Private Markets Due Diligence blog series, we’re highlighting some important questions to ask when evaluating evergreen funds, specifically those related to valuation and deal allocation, as well as (everyone’s favorite topic) fees.
Our last couple of blog posts – which focused on deal flow, investment types and structural differences – have hopefully provided some useful reference points as you conduct due diligence on evergreen private fund structures.
As showcased in the first blog in our series discussing private markets, the opportunity set within the asset class is large and inefficiencies exist that ultimately can lead to outsized risk/return characteristics. However, in what is an increasingly complex industry, not all private market investment opportunities are created equal.
You’ve no doubt heard about or read about the ever-declining number of public market stocks available to investors today. For instance, the Wilshire 5000 Index used to contain 5,000 stocks; today that number is closer to 3,500.