PE hold periods compress under pressure to show returns

The article notes typical PE hold periods of 4-6 years but argues pressure to show returns often compresses the timeline, leading to re-sales, asset stripping, or mergers when the math fails by year three.

“Typical hold periods range from 4 to 6 years, but pressure to show returns often compresses the timeline.⁶ When the math does not work at year three, the firm does not wait until year six to find out if things improve.”

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