Understanding private equity fees

Private equity fees, often perceived as high, are due to the very nature of this asset class. Unlike in public markets, managers conduct in-depth preliminary work involving complex due diligence (financial, operational, market, legal, and ESG) to identify the best opportunities.They then actively participate in transforming companies (strategy, growth, digitalization, internationalization) with a long-term vision (5 to 7 years), which justifies higher costs. These fees must be analyzed in relation to net performance: historically, private equity has delivered returns superior to those of public markets (approximately 13.5% vs. 7–8% IRR ). Fees are also higher at the outset (J-curve), as they finance investment work already underway. Finally, at Altaroc, fees are optimized and come with access to top-tier funds, strong diversification, and expert monitoring, all aimed at achieving high net performance over the long term.