There are nearly 25x the number of actively-held, private equity companies than there are publicly traded companies.
Private equity markets are significantly smaller in total capitalization compared to public equity markets, despite having many more companies.
As of late 2024/early 2025 data, private equity and venture capital combined had approximately $11 trillion in assets under management, which is about 12% of the size of the public equity markets valued at around $87 trillion.
Meanwhile, the number of companies backed by private equity or venture capital is roughly 25 times higher than the number of public companies, which total around 8,800 global constituents. There are currently over 215,000 companies with either private equity or venture capital backing.1
In comparison, the MSCI ACWI Investable Market Index, which covers 99% of the global public equity opportunity set, has approximately 8,800 constituents as of September 30.
This size discrepancy reflects that public companies tend to be larger on average, often including very large market capitalizations above $3 billion, whereas private equity firms hold stakes in many smaller companies.
The private equity market is broad and diverse but remains a fraction of the capitalization seen in public markets, even though it includes a significantly greater number of companies overall.
Data from Cambridge Associates shows that private equity has consistently outperformed stocks for the past 25 years. The comparison is between the returns of roughly 1,500 private equity funds and the Russell 3000, which is an index made up of the 3,000 largest U.S. public companies.
During the 25-year period ending with December 31, 2022, private equity saw an average annual return of 13.33%, while the Russell 3000 saw an average return of 8.16%.3
But those returns don’t necessarily tell the whole story. First, private equity is considered a high-risk investment. Yes, you have a chance of getting a return that’s higher than the stock market. However, you also have a greater chance of losing your money, given that private equity often invests in startups. Private equity funds also tend to have high fees, which can cut into returns.
Additionally, private equity funds are highly illiquid. When you invest in one of these funds, you’re often committing your money for many years before you can expect a return. As a result, you’re faced with the opportunity cost of the investment returns you could have made elsewhere during that time.
Source: