PitchBook Flags Potential Bottleneck In 2022 Fundraising

Fundraising may be more challenging in the second half of the year than in the first, according to PitchBook's comprehensive U.S. PE Breakdown of the U.S. market published on April 11. "The current fundraising demand from GPs is simply overwhelming LPs' ability to supply capital," write the authors. Several factors are at play: (1) megafunds are closing at meaningful step ups, (2) fund drawdowns have shortened and fundraising frequency accelerated, and (3) the number of funds in the market is at an all-time high.

To illustrate the first of these points, PitchBook reports that nine funds seeking $20 billion or more are raising or have already closed in 2022. Prior to this year, only seven funds of this size had ever been raised.