Updated with correction
U.S. private equity funds earned a pooled mean 17.7% internal rate of return and U.S. venture capital funds earned 8.2% for the year ended Sept. 30, according to data released Wednesday by Cambridge Associates.
For the quarter, the domestic private equity IRR was 5.1%, up from 1.6% in the second quarter. Venture capital returned 3.7%, an increase from 0.4% the previous quarter, according to a news release from Cambridge.
Private equity funds made capital distributions of nearly $16.7 billion in the third quarter, up 28% from the second quarter and the highest level in three years. Investor contributions increased to about $20 billion in the quarter, a 5.2% increase from the second quarter.
“For the third quarter, contributions again outnumbered distributions, as they have for more than three years running,” said Andrea Auerbach, managing director and head of U.S. private equity research at Cambridge Associates in the new release. “We also saw the exit environment continue to improve, with realizations actually increasing faster than investments. In addition, credit availability during the third quarter continued on a path towards pre-recession levels.”
Cambridge executives could not be reached for further comment by press time.