HarbourVest Global Private Equity (HVPE)

HarbourVest Global Private Equity (HVPE) offers a unique exposure to private companies globally. Huge amounts of shareholder value has been created outside of public markets, and HVPE provides an excellent way for public market investors to access this potential. As we discuss in the Portfolio section, HVPE’s exposures to SpaceX (first invested in 2009), Anthropic (2024) and Databricks (2013) have seen very rapid valuation growth of late. In fact, of the 20 largest “unicorns”, defined as private companies with a valuation of over $1 billion, HVPE has an exposure to 15 of them. As such, HVPE provides a broad exposure to the most in-demand, innovative companies globally that are making financial headlines.

Over the long term, HVPE has delivered strong returns that have outperformed quoted equities. However, over the past five years returns have been relatively muted, especially compared with public markets. HVPE’s share price total return is now ahead of the NAV total return over five years, a result of the discount narrowing (see Discount section). HVPE’s NAV performance is in-line with the closest comparable peer – Pantheon International (PIN), but ahead of the Morningstar peer group average. A result of surging confidence in equity markets, the FTSE All-World ETF is well ahead of all of these comparators.

As we discuss in the Gearing section, as a result of actual distributions being below expectations for a number of years, leverage within the trust and the underlying HarbourVest funds has been ticking up. The board sees future secondary sales as a release valve to improve liquidity, which should enable them to manage gearing even if organic distributions continue to underwhelm. With the team working on secondary sales in the background, we believe that HVPE’s higher gearing should be less cause for concern.