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Bringing Public Market Precision to Private Markets

  • Strategy insight

April 29, 2026 | 7 min read

Scott Voss

Managing Director, Senior Market Strategist

David Butts

Principal, Quantitative Investment Science

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How proprietary investment-level benchmarks and attribution may unlock investment edge.

Private markets have long been defined by limited transparency and fragmented data. Traditional private equity benchmarking relies heavily on aggregated fund-level metrics, which can obscure the true drivers of performance. As a result, investors often struggle to determine whether a manager’s historical outperformance reflects repeatable skill or favorable market conditions.  That challenge is heightened in the current market environment, where wider dispersion across managers has made accurate benchmarking and performance attribution analysis more consequential than ever.

Amid these challenges, HarbourVest is seeking to enable deeper manager due diligence and more informed portfolio construction. Drawing on more than 40 years of experience in private markets, we’ve developed proprietary investment-level benchmarks built from more than 65,000 transactions across 25+ vintages—one of the deepest datasets in the industry.

By focusing on investment-level returns isolated from fund-level economics, these benchmarks can deliver a transparent and representative view of private equity opportunities, revealing insights that are unattainable with traditional fund-level benchmarking. As illustrated in Chart 1, investment-level granularity is critical for identifying sector-level performance dynamics. Information technology has shown strong cumulative outperformance relative to other sectors, despite periods of more recent underperformance, while financials have exhibited stronger momentum in recent years. These shifts underscore how sector leadership can vary by market environment and measurement horizon, highlighting the value of granular, investment-level analysis.

HarbourVest Global Buyout Sector Benchmarks:
Gross Performance (12/31/2006—9/30/2025)

Source: HarbourVest. As of September 30, 2025. The HV PE Benchmarks reflect a compilation of PE partnership and transactional data drawn from internal and external sources and related estimated valuations of such companies by HarbourVest for the illustrated period (which in turn are based on HarbourVest’s subjective assumptions). Performance is in USD. The global buyout sector returns are not representative of any HarbourVest fund, account, and is not representative of any HarbourVest investment experience. Gross of management fees and carried interest.

Source: HarbourVest. Annualized time-weighted returns presented in USD, gross of fees and carried interest, as of 9/30/2025. Consumer category combines Consumer Discretionary and Consumer Staples sectors. Investment Benchmarks not shown for Energy, Real Estate, and Utilities sectors, which represent <2% market weight as of 9/30/25. Downside deviation and Sortino ratio calculated with minimum acceptable return of 0%.

HarbourVest Private Equity Investment Benchmarks can provide:

  • Greater transparency at the sector, industry, and regional level:

    Revealing the true drivers of risk and return that fund-level benchmarks mask and enabling a more precise performance attribution analysis that can inform manager skill evaluation and investment selection.

  • Practical asset allocation guidance:

    Because these benchmarks are built from investment data, they allow us to answer actionable asset allocation questions—what are a portfolio’s active weights by sector and geography relative to the benchmark? How do active sector weights and timing decisions drive portfolio returns?

  • Enable more apples-to-apples comparisons with public markets:

    The benchmarks are calculated using time-weighted returns, making them more suitable for attribution and risk factor analysis, similar to the rigorous analysis typically performed on public market holdings. The data in Table 1 summarizes time weighted returns, drawdown risk, and risk-adjusted returns at the sector level, facilitating a more direct comparison of investment risk and return profile both within private markets and relative to public market analogues.

Critically, investment-level data allows for more precise benchmarking by sector and geography—two factors that meaningfully influence manager performance but cannot be isolated with fund-level benchmarks.

Key Applications

We have been actively using these benchmarks for the past five years to inform our own investment decisions in two critical areas:

Manager Evaluation: We apply a Brinson-style attribution framework—long standard in public markets—to private equity, decomposing performance into allocation decisions (where capital was deployed) and security selection (which assets were chosen within those exposures). Evaluating managers through this lens can clarify whether performance is driven by manager skill—such as company selection and operations—or by exposure to favorable segments of the market. Understanding past performance then provides an edge in being able to identify skilled managers, resulting in potentially better future performance.

Portfolio Construction: Insights from the benchmarks directly inform portfolio construction and allocation decisions by clarifying performance drivers and exposures across investments, sectors, and geographies, enabling more precise targeting of market and active weights. Additional analysis made possible by these investment-level benchmarks is incorporated into portfolio construction considerations to optimize diversification and potential alpha generation.   

Below, we dive deeper into what our benchmarks look like in action across these two applications.

Deep dive: Informing manager evaluation with GP Alpha Analysis

Building on the foundation of our benchmarks and an established performance attribution framework, our Quantitative Investment Science (QIS) team developed GP Alpha Analysis, a tool designed to assess GP performance with unprecedented granularity. By comparing a manager’s track record returns against a representative investment-level benchmark, we can isolate the extent to which value creation stems from sector allocation, geographic exposure, or deal selection, rather than broad market movements. In a market with inherently wide dispersion of returns across managers, deeper insight into manager skill has the potential to enhance alpha generation and improve investment selection.

GP Alpha Analysis: Gross performance attribution example

As of September 2025. Source: HarbourVest investment, monitoring, and due diligence activities. Not representative of any HarbourVest fund, account, and is not representative of any HarbourVest investment experience. Gross of management fees and carried interest. Performance in USD. For illustrative purposes only. Returns shown for deals covered by HarbourVest Index, which represent a subset of the manager’s investments. Simulated manager returns do not reflect HarbourVest investments. Past performance is not a reliable indicator of future results.

Example GP Alpha Analysis. Leveraging HarbourVest’s investment-level benchmarks, the analysis decomposes the gross return multiple of a manager track record into two components, Market Value and Excess Value, which attribute the contribution of the broad market benchmark return and the excess value or alpha added/detracted by the manager (left image). On the right, the Brinson-style analysis further decomposes the total alpha into sector allocation and company selection components. In this case the manager focused on software buyouts, a sector that performed strongly during the analysis period. As a result, a significant portion of the manager’s alpha was attributed to the tailwinds in the sector broadly — the analysis is therefore able to isolate the asset selection alpha that is the true value-add for the manager’s strategy.

GP Alpha Analysis packages this benchmarking and attribution work into a repeatable workflow that supports comparative manager analysis across strategies, sectors, geographies, and time periods.

GP Alpha Analysis supports a wide range of use cases, including primary fund investments, underwriting concentrated secondary opportunities, and evaluating direct co-investments. At HarbourVest, these insights are already being applied across the entire investment platform with 100+ active users complementing a rigorous qualitative due diligence framework.

In today’s environment of elevated interest rates, shifting market dynamics, and concentrated sector risk, GP Alpha Analysis helps HarbourVest pinpoint top managers with greater confidence and clarity.

Deep dive: Informing portfolio construction with investment-level insights

  • Strategic Allocation Decisions: Understanding performance drivers and exposures at the investment, sector, and geographic levels enables investors to more precisely monitor portfolio exposures and target active allocation weights.

  • Complementary Allocation Across Asset Classes: Investors can gain insight from the complementary geographic and industry exposures between private equity and public equity portions of their portfolio.

Sources: HarbourVest, MSCI.

*Consumer category combines Consumer Discretionary and Consumer Staples sectors.

  • Risk Factor Exposures: Time-weighted return benchmarks constructed from the investment-level can enable investors to evaluate risk factor exposures of their private and public market exposures together on a more like-for-like basis, to inform a total portfolio or TPA allocation framework.

  • Align Sector Allocations with Manager Strengths: Comparative manager-level analysis highlights where managers have demonstrated sector-specific selection skill, enabling more informed allocation decisions across generalists and sector specialists to enhance sector diversification and potential alpha generation.

A meaningful advancement in private markets investing

We believe HarbourVest’s proprietary benchmarks and the analytical tools built upon them represent a meaningful advancement in private markets investing.

Looking ahead, HarbourVest believes private markets investors will increasingly benefit from analytical rigor comparable to that long established in public markets. As transparency improves and datasets deepen, advanced attribution tools will play a critical role in strengthening investor confidence and improving investment outcomes for limited partners.

If you are interested in learning more about HarbourVest’s data-driven tools or how our QIS team can support your investment strategy, we welcome the opportunity to connect.

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About the HarbourVest Private Equity Benchmarks (“HV PE Benchmarks”)

HarbourVest’s proprietary benchmarks, created by the firm’s Quantitative Investment Science group, track the performance of PE and venture-owned companies. HarbourVest releases benchmark performance for companies in the following categories (i) Global Buyouts; (ii) US Buyouts, a subset of the Global Buyouts category; (iii) US Venture Capital; (iv) Global ex-US Buyouts, a subset of the Global Buyouts category; and (v) Europe Buyouts, a subset of the Global Buyouts category. An investment benchmark is similar to a scorecard, used to measure how well an investment is performing compared to a relevant counterpart. The HarbourVest benchmarks are based on HarbourVest’s proprietary dataset of over 65,000 investments that have been held in PE funds, representing more than $3.7 trillion of capital invested collectively as of September 30, 2025. We believe these benchmarks can provide recipients with differentiated information based on extensive private deal data and cash flow history, enabling transparency into performance drivers to provide more granular insights than is available with traditional PE benchmarks. 

Disclosure

HarbourVest Private Equity Benchmarks (“HV PE Benchmarks”). Market analysis is not representative of any HarbourVest product: The HV PE Benchmarks reflect a compilation of PE partnership and transactional data drawn from internal and external sources and related estimated valuations of such companies by HarbourVest for the illustrated period (which in turn are based on HarbourVest’s subjective assumptions). Returns are not representative of any HarbourVest fund, account, and are not representative of any HarbourVest investment experience. Returns are gross of management fees and carried interest. The HV PE Benchmarks data universe information has been developed internally based on information obtained from sources believed to be reliable; however, HarbourVest does not guarantee the accuracy, adequacy or completeness of such information or HarbourVest’s related valuation estimates or assumptions, which may be materially inaccurate. The HV PE Benchmarks are intended to be representative of the broader PE market and do not reflect any views, analysis, or recommendation by HarbourVest with respect to any particular investment and are not representative of the investment performance of any HarbourVest investment or the experience of any investor in any HarbourVest product. Past performance is not indicative of future results.

HarbourVest Partners, LLC (“HarbourVest”) is a registered investment adviser under the Investment Advisers Act of 1940. This material is solely for informational purposes and should not be viewed as a current or past recommendation or an offer to sell or the solicitation to buy securities or adopt any investment strategy. The opinions expressed herein represent the current, good faith views of the author(s) at the time of publication, are not definitive investment advice, and should not be relied upon as such. This material has been developed internally and/or obtained from sources believed to be reliable; however, HarbourVest does not guarantee the accuracy, adequacy or completeness of such information. The information is subject to change without notice and HarbourVest has no obligation to update you. There is no assurance that any events or projections will occur, and outcomes may be significantly different than the opinions shown here. This information, including any projections concerning financial market performance, is based on current market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons.

The HarbourVest Global Buyout Benchmark seeks to measure the performance, gross of fund fees, expenses and carried interest, of buyout investments made by private equity funds in private companies globally.

The HarbourVest U.S. Buyout Benchmark seeks to measure the performance, gross of fund fees, expenses and carried interest, of buyout investments made by private equity funds in private companies that are based in the United States.

The HarbourVest Europe Buyout Benchmark seeks to measure the performance, gross of fund fees, expenses and carried interest, of buyout investments made by private equity funds in private companies that are based in Western and Eastern Europe and the Nordics.

The MSCI USA Index is designed to measure the performance of the large and mid cap segments of the US market. With 576 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in the US.

The MSCI Europe Index captures large and mid cap representation across Developed Markets (DM) countries in Europe. The index covers approximately 85% of the free float-adjusted market capitalization across the European Developed Markets equity universe.

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Professional Investor Definition

“Professional Investor” under the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (the “SFO”) and its subsidiary legislation) means:

(a) any recognised exchange company, recognised clearing house, recognised exchange controller or recognised investor compensation company, or any person authorised to provide automated trading services under section 95(2) of the SFO;

(b) any intermediary, or any other person carrying on the business of the provision of investment services and regulated under the law of any place outside Hong Kong;

(c) any authorized financial institution, or any bank which is not an authorised financial institution but is regulated under the law of any place outside Hong Kong;

(d) any insurer authorized under the Insurance Ordinance (Cap. 41 of the Laws of Hong Kong), or any other person carrying on insurance business and regulated under the law of any place outside Hong Kong;

(e) any scheme which-

(i) is a collective investment scheme authorised under section 104 of the SFO; or

(ii) is similarly constituted under the law of any place outside Hong Kong and, if it is regulated under the law of such place, is permitted to be operated under the law of such place,

or any person by whom any such scheme is operated;

(f) any registered scheme as defined in section 2(1) of the Mandatory Provident Fund Schemes Ordinance (Cap. 485 of the Laws of Hong Kong), or its constituent fund as defined in section 2 of the Mandatory Provident Fund Schemes (General) Regulation (Cap. 485A of the Laws of Hong Kong), or any person who, in relation to any such registered scheme, is an approved trustee or service provider as defined in section 2(1) of that Ordinance or who is an investment manager of any such registered scheme or constituent fund;

(g) any scheme which-

(i) is a registered scheme as defined in section 2(1) of the Occupational Retirement Schemes Ordinance (Cap. 426 of the Laws of Hong Kong); or

(ii) is an offshore scheme as defined in section 2(1) of that Ordinance and, if it is regulated under the law of the place in which it is domiciled, is permitted to be operated under the law of such place,

or any person who, in relation to any such scheme, is an administrator as defined in section 2(1) of that Ordinance;

(h) any government (other than a municipal government authority), any institution which performs the functions of a central bank, or any multilateral agency;

(i) except for the purposes of Schedule 5 to the SFO, any corporation which is-

(i) a wholly owned subsidiary of-

(A) an intermediary, or any other person carrying on the business of the provision of investment services and regulated under the law of any place outside Hong Kong; or

(B) an authorized financial institution, or any bank which is not an authorised financial institution but is regulated under the law of any place outside Hong Kong;

(ii) a holding company which holds all the issued share capital of-

(A) an intermediary, or any other person carrying on the business of the provision of investment services and regulated under the law of any place outside Hong Kong; or

(B) an authorized financial institution, or any bank which is not an authorised financial institution but is regulated under the law of any place outside Hong Kong; or

(iii) any other wholly owned subsidiary of a holding company referred to in subparagraph (ii); or

(j) any person of a class which is prescribed by rules made under section 397 of the SFO for the purposes of this paragraph as within the meaning of this definition for the purposes of the provisions of the SFO, or to the extent that it is prescribed by rules so made as within the meaning of this definition for the purposes of any provision of the SFO.

The first of such classes of additional “professional investor”, under the Securities and Futures (Professional Investor) Rules (Cap. 571D of the Laws of Hong Kong), are:

(k) any trust corporation (registered under Part VIII of the Trustee Ordinance (Cap. 29 of the Laws of Hong Kong) or the equivalent overseas) having been entrusted under the trust or trusts of which it acts as a trustee with total assets of not less than HK$40 million or its equivalent in any foreign currency at the relevant date (see below) or-

(i) as stated in the most recent audited financial statement prepared-

(A) in respect of the trust corporation; and

(B) within 16 months before the relevant date;

(ii) as ascertained by referring to one or more audited financial statements, each being the most recent audited financial statement, prepared-

(A) in respect of the trust or any of the trust; and

(B) within 16 months before the relevant date; or

(iii) as ascertained by referring to one or more custodian (see below) statements issued to the trust corporation-

(A) in respect of the trust or any of the trusts; and

(B) within 12 months before the relevant date;

(l) any individual, either alone or with any of his associates (the spouse or any child) on a joint account, having a portfolio (see below) of not less than HK$8 million or its equivalent in any foreign currency at the relevant date or-

(i) as stated in a certificate issued by an auditor or a certified public accountant of the individual within 12 months before the relevant date; or

(ii)  as ascertained by referring to one or more custodian statements issued to the individual (either alone or with the associate) within 12 months before the relevant date;

(m) any corporation or partnership having-

(i) a portfolio of not less than HK$8 million or its equivalent in any foreign currency; or

(ii) total assets of not less than HK$40 million or its equivalent in any foreign currency, at the relevant date, or as ascertained by referring to-

(iii) the most recent audited financial statement prepared-

(A) in respect of the corporation or partnership (as the case may be); and

(B) within 16 months before the relevant date; or

(iv) one or more custodian statements issued to the corporation or partnership (as the case may be) within 12 months before the relevant date; and

(n) any corporation the sole business of which is to hold investments and which at the relevant date is wholly owned by any one or more of the following persons-

(i) a trust corporation that falls within the description in paragraph (k);

(ii) an individual who, either alone or with any of his or her associates on a joint account, falls within the description in paragraph (k);

(iii) a corporation that falls within the description in paragraph (m);

(iv) a partnership that falls within the description in paragraph (m).

For the purposes of paragraphs (k) to (n) above:

  • “relevant date” means the date on which the advertisement, invitation or document (made in respect of securities or structured products or interests in any collective investment scheme, which is intended to be disposed of only to professional investors), is issued, or possessed for the purposes of issue;
  • “custodian” means (i) a corporation whose principal business is to act as a securities custodian, or (ii) an authorised financial institution under the Banking Ordinance (Cap. 155 of the Laws of Hong Kong); an overseas bank; a corporation licensed under the SFO; or an overseas financial intermediary, whose business includes acting as a custodian; and
  • “portfolio” means a portfolio comprising any of the following (i) securities; (ii) certificates of deposit issued by an authorised financial institution under the Banking Ordinance (Cap, 155 of the Laws of Hong Kong) or an overseas bank; and (iii) except for trust corporations, cash held by a custodian.

Institutional Investor / Accredited Investor Definition

An institutional investor as defined in Section 4A of the SFA and Securities and Futures (Classes of Investors) Regulations 2018 is:

(a) the Singapore Government;

(b) a statutory board as may be prescribed by regulations made under section 341 of the SFA, as prescribed in the Second Schedule of the Securities and Futures (Classes of Investors) Regulations 2018;

(c) an entity that is wholly and beneficially owned, whether directly or indirectly, by a central government of a country and whose principal activity is —

(i) to manage its own funds;

(ii) to manage the funds of the central government of that country (which may include the reserves of that central government and any pension or provident fund of that country); or

(iii) to manage the funds (which may include the reserves of that central government and any pension or provident fund of that country) of another entity that is wholly and beneficially owned, whether directly or indirectly, by the central government of that country;

(d) any entity —

(i) that is wholly and beneficially owned, whether directly or indirectly, by the central government of a country; and

(ii) whose funds are managed by an entity mentioned in sub‑paragraph (c);

(e) a bank that is licensed under the Banking Act 1970;

(f) a merchant bank that is licensed under the Banking Act 1970;

(g) a finance company that is licensed under the Finance Companies Act 1967;

(h) a company or co‑operative society that is licensed under the Insurance Act 1966 to carry on insurance business in Singapore;

(i) a company licensed under the Trust Companies Act 2005;

(j) a holder of a capital markets services licence;

(k) an approved exchange;

(l) a recognised market operator;

(m) an approved clearing house;

(n) a recognised clearing house;

(o) a licensed trade repository;

(p) a licensed foreign trade repository;

(q) an approved holding company;

(r) a Depository as defined in section 81SF of the SFA;

(s) a pension fund, or collective investment scheme, whether constituted in Singapore or elsewhere;

(t) a person (other than an individual) who carries on the business of dealing in bonds with accredited investors or expert investors;

(u) a designated market‑maker as defined in paragraph 1 of the Second Schedule to the Securities and Futures (Licensing and Conduct of Business) Regulations;

(v) a headquarters company or Finance and Treasury Centre which carries on a class of business involving fund management, where such business has been approved as a qualifying service in relation to that headquarters company or Finance and Treasury Centre under section 43D(2)(a) or 43E(2)(a) of the Income Tax Act 1947;

(w) a person who undertakes fund management activity (whether in Singapore or elsewhere) on behalf of not more than 30 qualified investors;

(x) a Service Company (as defined in regulation 2 of the Insurance (Lloyd’s Asia Scheme) Regulations) which carries on business as an agent of a member of Lloyd’s;

(y) a corporation the entire share capital of which is owned by an institutional investor or by persons all of whom are institutional investors;

(z) a partnership (other than a limited liability partnership within the meaning of the Limited Liability Partnerships Act 2005) in which each partner is an institutional investor.

An accredited investor as defined in Section 4A of the SFA and Securities and Futures (Classes of Investors) Regulations 2018 is:

(i)  an individual —

(A) whose net personal assets exceed in value $2 million (or its equivalent in a foreign currency) or such other amount as the Authority may prescribe in place of the first amount;

(B) whose financial assets (net of any related liabilities) exceed in value $1 million (or its equivalent in a foreign currency) or such other amount as the Authority may prescribe in place of the first amount, where “financial asset” means —

(BA) a deposit as defined in section 4B of the Banking Act 1970;

(BB) an investment product as defined in section 2(1) of the Financial Advisers Act 2001; or

(BC) any other asset as may be prescribed by regulations made under section 341; or

(C) whose income in the preceding 12 months is not less than $300,000 (or its equivalent in a foreign currency) or such other amount as the Authority may prescribe in place of the first amount;

(ii)  a corporation with net assets exceeding $10 million in value (or its equivalent in a foreign currency) or such other amount as the Authority may prescribe, in place of the first amount, as determined by —

(A) the most recent audited balance sheet of the corporation; or

(B) where the corporation is not required to prepare audited accounts regularly, a balance sheet of the corporation certified by the corporation as giving a true and fair view of the state of affairs of the corporation as of the date of the balance sheet, which date must be within the preceding 12 months;

(iii) A trustee of a trust which all the beneficiaries are accredited investors; or

(iv) A trustee of a trust which the subject matter exceeds S$10 million; or

(v) An entity (other than a corporation) with net assets exceeding S$10 million (or its equivalent in a foreign currency) in value. “Entity” includes an unincorporated association, a partnership and the government of any state, but does not include a trust; or

(vi) A partnership (other than a limited liability partnership) in which every partner is an accredited investor; or

(vii) A corporation which the entire share capital is owned by one or more persons, all of whom are accredited investors.

Continuation solutions encompass a host of transaction types in which a GP secures interim liquidity and/or additional primary capital for their LPs in a strongly performing asset, or set of assets, that the GP will continue to own and control. Specifically, they include continuation funds, new funds created by GPs for the purpose of acquiring the asset(s) that continue to be managed by the same GP and capitalized by one or several secondary buyers, or equity recapitalizations involving a direct equity or structured equity investment into a portfolio company. These transactions can also include a parallel investment from the GP’s latest fund into that same pool of assets (a “cross-fund trade”).