Private Equity: The Asset Class That Has Outperformed Markets for 30 Years, and How to Access It

An Asset Class Most People Don't Know About

There is an asset class that has delivered 12.4% net per year over the last ten years. It has only recently become available to individual investors. And most people have never heard of it: private equity.

What is Private Equity?

Private equity is investing in companies that are not publicly traded.

No stock on a screen, no real-time quotes. You become a shareholder in an SME, a growing company, or a company undergoing transformation, usually through a specialized fund that buys, develops, and then sells these companies at a profit.

In the stock market, you buy a listed share that you can sell in seconds. In private equity, you commit to locking up your money for 8 to 12 years, the time it takes for the fund to buy companies, develop them, and then sell them. This illiquidity is the trade-off for a historically higher return.

Private equity comes in several forms:

• Venture capital: funding startups,
• Growth capital: supporting growing SMEs,
• LBO: leveraged buyouts,
• Infrastructure.

Each segment has its own risk and return profile.

The Numbers Don't Lie

According to the 31st annual France Invest / EY study, published in July 2025 and covering 1,079 funds analyzed, the net IRR of French private equity stands at 11.3% per year since the industry's inception, and 12.4% over a 10-year horizon as of the end of 2024.

The outperformance compared to other asset classes is documented over the last ten years:

• 12.4% net per year for private equity,
• 8.9% for the CAC 40 with dividends reinvested,
• 8.3% for the CAC All Tradable.

These figures are calculated using the PME (Public Market Equivalent) method, which allows for a fair comparison taking into account cash flows over time.

Over the period 2013-2022:

• commercial real estate showed a 5.6% annual return,
• international hedge funds around 4 to 5%,
• private equity led with 14.2% over those same ten years.

The 3.5-point gap compared to the CAC 40 over ten years represents a considerable difference in final capital. 100,000 euros invested for ten years yields about 236,000 euros at 9% annually, and 321,000 euros at 12.4%. That's 85,000 euros more over the same period.

How It Works in Practice

The cycle of a private equity fund follows a well-established logic.

• The first years are devoted to fundraising and acquisitions.
• The development phase then lasts from 3 to 7 years, during which the manager works to improve the profitability of the companies held.
• Exits occur between years 6 and 10, in the form of sales to industrial players, IPOs, or sales to other funds.

You must understand the J-curve. In the early years, the apparent return is negative: fees and investments weigh on the net asset value before gains appear.

This is the very nature of the asset class. An investor who becomes impatient halfway through misses precisely the phase of value creation.

What Has Changed for Individuals

For decades, private equity was reserved for institutions and family offices, with entry tickets of several hundred thousand euros.

Since 2024, ELTIF 2.0 vehicles and some accessible FCPR allow investments from 1,000 euros, with regulated taxation.

The French private equity market represents about 135 billion euros in assets under management in 2025. In 2024, 26 billion euros were invested in 2,692 projects, up 16% compared to 2023.

What Not to Forget

The historical performance is real and verified. But private equity has structural constraints that would be dishonest to overlook.

• Performance dispersion between the first and fourth quartile of managers reaches 31.6 points of annualized IRR as of the end of 2024. Selecting the manager is therefore as important as the asset class itself.
• Illiquidity is a real constraint: your capital is immobilized, with no possibility of early exit in classic funds.
• The J-curve requires patience that not all investors are ready to accept.

Choosing the wrong fund can be as destructive as choosing the right one is rewarding.

Private Equity Is Not a Substitute for Your Emergency Savings

It's an additional layer in an already solid wealth architecture, for the part of your capital that you can commit for the long term.

I would even say the top layer: when you've already built emergency savings, invested in real estate, the stock market, and possibly cryptos, and want to move to the next level.

Done correctly, with a rigorously selected manager and an assumed horizon, it's one of the most powerful wealth decisions you can make. It is also, by nature, the one that requires the most method, exactly the value that Axone-Capital places at the heart of every allocation.