This English version is a translation of the original in Japanese for information purposes only. In case of any discrepancy or inconsistency
between the Japanese version and its English version, the Japanese version shall always prevail.

JPEA Private Equity
Performance Measurement Survey(2020)

May 2022
The Japan Private Equity Association
PricewaterhouseCoopers Aarata LLC
Confidential目次

2Highlights

03

Survey overview

05

Survey results-

Since-inception IRRs

07-

Horizon IRRs

09-

Total value to paid-in multiples

11

Supplementary information-

Data collected for this survey

14-

Change of return calculation method

15-

Considerations for use of this survey

16-

List of participating companies

17

Highlights (1/2): Since-inception IRRs

3

The since-inception IRR through the end of 2020 for the funds surveyed in the 2009-17 vintage years was
16.1%

 The IRRs through the end of 2020 for eachfund group, where the funds surveyed aregrouped by fund inception year (vintage year),are shown in the lower right-hand chart- Considering that the investment period of most funds
is 10 years, with the first five years generally being
the investment execution period and the second five
years being the investment collection period, the IRRsof the most recent three-year vintages are shown forreference purpose only as they are not very
meaningful.

Trends of since-inception IRR through the end of each year
(Aggregate value of the funds of 2009-17 vintage years)

16.1%
15.4% 15.2% 15.9% 15.5% 16.0%

All the funds in the aggregate
were in an investment
execution period until 2013

2009

2010

2011

2012

11.8%

2013

2014

2015

2016

2017

2018

2019

2020

Since-inception IRRs by vintage year through 2020

 Aggregating the funds of the 2009-17 vintage,
the IRR since inception of the funds is
calculated to be 16.1% through the end of
2020. The IRRs since inception through the endof each year are shown in the upper right-handchart.

16.0%

18.9%

17.7%

IRRｓ of last 3 vintage-year
funds are for reference only

Not
Not
Not
Not
applicable disclosed* disclosed* disclosed*

Not
disclosed*

-0.4%
2009

2010

2011

2012

2013

2014

Vintage years mainly in
an investment collection stage

2015

2016

2017

2018

2019

2020

Vintage years mainly in
an investment execution stage*IRRs for vintage year groups with fewer than three funds surveyed are not disclosed

Highlights (2/2): Horizon IRRs

4

The ten-year horizon IRR (2011 to 2020) for the funds surveyed was 15.2%, which outperformed the
TOPIX over the same period by +5.6%.

 The IRRs of the funds surveyed over certain
time frames, calculated by aggregating the net
assets at the beginning and end of themeasurement period and the cash flows during
the measurement period to enable a
comparison with benchmarks such as TOPIX,
are shown on the right. The IRRs of the funds
surveyed outperformed the TOPIX Total Return
Index for each measurement period- The IRR for each measurement period includes theperformance of the funds which were in existence atthe beginning of the measurement period- Given the life cycle of private equity funds, if themeasurement period is short, the IRR is likely to beaffected by investment collections on a specific few
deals that occur during that period, and the IRR will
be highly skewed. Therefore, please refer mainly to
the IRRs over 5 years and 10 years in the chart on theright. 1-year and 3-year IRRs are calculated forreference purpose only.

Horizon IRRs as at the end of 2020
Return of TOPIX Total Return Index

Horizon IRR for all funds surveyed+5.6%pt

Reference only due to short measurement period

15.2%+5.3%pt
10.8%

9.9%

9.6%

7.4% 7.2%
5.5%
2.2%

1 year

3 years

5 years

10 years(2020)(2018-20)(2016-20)(2011-20)

Survey overview

1. Companies participating in the survey
27 of the full members of the Japan Private Equity Association (hereinafter referred to as the "JPEA")

2. Funds surveyed
Private equity funds managed by the participating companies, mainly invested in Japan, which were in existence between January
2008 and December 2020 (including funds liquidated on or before 31 December 2020), 94 funds in total

3. Periods for performance measurement
Fiscal periods ended in the 10 years from January 2011 to December 2020 of the funds surveyed, including liquidated funds

4. Method of survey- PricewarterhouseCoopers Aarata LLC (hereinafter referred to as “PwC Aarata”), commissioned by JPEA, asked theparticipating companies to provide the necessary data
- The participating companies provided PwC Aarata with the basic information, cash flow data and net asset value data at theend of each fiscal period of the funds surveyed- PwC Aarata calculated the internal rate of returns since inception of each fund (hereinafter referred to as the “since-inception
IRRs”, the internal rate of returns for 1, 3, 5 and 10 year horizons through the end of 2020 (hereinafter referred to as the“horizon IRRs”) and the total value to paid-in (TVPI) multiples

56Highlights

03

Survey overview

05

Survey results-

Since-inception IRRs

07-

Horizon IRRs

09-

Total value to paid-in multiples

11

Supplementary information-

Data collected for this survey

14-

Change of return calculation method

15-

Considerations for use of this survey

16-

List of participating companies

17

Survey results: Since-inception IRRs

7

Since-inception IRRs of the surveyed funds grouped by fund inception year (vintage year) through eachend of year are shown in the table below (the bottom row of each vintage year column shows the numberof funds included in each group)
Measurement
Group
Up to v.2008
Total
v.2009v.2010v.2011v.2012

Vintage year

v.2013v.2014v.2015v.2016v.2017v.2009-17 Total
Up to v.2017
Total(Reference only)
v.2018(Reference only)
v.2019(Reference only)
v.2020

Number offunds
surveyed

IRRs for the year ended

2020

35
2
1
3
3
8
5
2
7
9
40
75
8
1
6

4.10%
5
0

2019

2018

2017

2016

4.23%
6

5.35%
8

6.28%
13

1

1

2

1
1
Not disclosed
1
2
Not disclosed
2
2
16.02%
18.57%
7
7
17.67%
19.70%
5
5

1
13.62%
3

2
2-0.37%-1.66%
7
7
18.91%
22.96%
99
16.10%
15.96%
34
36
9.71%
9.89%
39
42
-1.10%-16.73%88
Not disclosed
1
1-12.66%61
12.38%
3
23.78%
2
3
20.86%
21.68%
7
7
22.85%
29.29%
5
5
Not disclosed
22-13.64%-18.26%7
7
12.18%-9.72%
9915.51%
15.93%
37
39
9.58%
9.21%
45
52
31.13%
8

2015

2014

8.05%
9.48%
17
22
Not disclosed
2
2
Not disclosed
1
1
10.57%
9.08%
3
3
20.14%
31.55%
3
3
19.66%
6.13%
8
8
38.60%
44.77%
5
5
2-15.49%72

15.15%
31
9.79%
48

15.38%
24
10.49%
46

2013

2012

2011

9.87%
23

8.11%
27

6.80%
33

3.84%
35

2

2

2

2

1
5.41%
3
26.48%
3-1.28%
850.30%
5

1-1.26%
3
16.18%
3-32.95%8

1-11.98%3-10.82%
3

1-98.34%
3

11.83%
22
10.12%
45

1.89%
17
7.60%
44

-5.53%
96.14%
42-8.04%
6
3.41%
41

Considerations for since-inception IRRs

8

Please consider the following when viewing the since-inception IRRs

General explanation of since-inception IRRs

Since-inception IRRs of grouped funds in multiple vintage years

 In this survey, the “since-inception IRR” means the annualized internal rate of return
since the inception of each fund. Since most private equity funds are closed-end, thesince-inception IRR is the most meaningful way to measure the performance.

 The since-inception IRR of a fund group with vintage years 2009-17 is calculated byassuming the funds started between 2009 and 2017 as once fund, not using aweighted-average method of funds or vintage years.

 The since-inception IRR is calculated by grouping the funds by vintage year, andaggregating the cash flows and the net assets at the end of the evaluation period of
the funds surveyed.

 In general, the calculation of the starting IRR for a grouping of funds with multiple
vintage years is greatly affected by the performance of funds with older vintage years.

 The since-inception IRR for vintage year groups with fewer than three funds surveyed
is not disclosed to avoid identification of individual funds.

Fair value measurement of portfolio investments

 The since-inception IRRs for the most recent three vintage years are calculated forreference purpose only. This is to take into account the nature of private equity
investments and the "J curve".
 The IRR for each year end includes the performance of the funds that started or
ended in the middle of each year. However, the performance of the funds liquidated
before the previous year are not included in the rates of each year. For example, theperformance of the fund, which ended in September 2019, is included in the IRR in
and before “To 2019” and is not included in and after “To 2020”.
 From this 2020 Performance Survey, a new return calculation method has been
adopted, whereby the since-inception IRR is calculated by vintage year, grouping thefunds started in the same year as if they were one large fund. For example, the sinceinception IRR for a group with a vintage year of 2013 is calculated by grouping thefunds that had their first cash flow in 2013 as if they were one fund. See page 15 for acomparison of the old method used in the reports through 2019 and the new method.
 The since-inception IRR of each vintage year group for each year is calculated for thefunds for which fiscal year ended in each calendar year (January 1 through December
31). However, the IRR of the funds for which fiscal year ends in January, February or
March is included in the performance of the previous calendar year of the year inwhich the fiscal year end belongs.

 Whether or not the portfolio investments held are measured at fair value will affect thecalculation of the since-inception IRR through the amount of fund net assets at yearend.
 For example, if you invest in 100 units at the beginning of a year and sell them at theend of 5 years after they have increased in value by 8% each year, the since-inception
IRR for each year will be calculated as 8% if you measure the investments at fairvalue. However, if you measure the investments at acquisition cost, the sinceinception IRR would be 0% for the 1st to 4th year, and only in the 5th year is thestarting IRR calculated to be 8%. Therefore, the since-inception IRR of an existing
fund may be calculated lower if the fair value measurement of portfolio investmentsthat earn a positive return has not been performed.

Comparison with benchmarks
 It is difficult to compare the performance of closed-end private equity funds tobenchmarks of other assets using since-inception IRRs. For this reason, this survey
intends to calculate the IRRs over a given time frame (“horizon IRRs”) to help you
compare the performance of closed-end private equity funds to the benchmarks.
Please refer to the next page and beyond for more information on horizon IRRs.

Survey results: Horizon IRRs

9

Horizon IRRs through the end of 2020 of the surveyed funds grouped by fund inception year (vintage year)
shown in the table below (the bottom row of each vintage year column shows the number of funds included ineach group)
Measurement GroupUp to v. 2008 Total
v. 2009v. 2010v. 2011v. 2012

Vintage year

v. 2013v. 2014v. 2015
v. 2016
v. 2017
v. 2018
v. 2019
v. 2020
Total
Return of TOPIX Total Return Index

Number of funds
surveyed
35(Reference only)
1 year:
2020
4.24%

5
0

2
1
3
3
8
5
2
7
9
8
1

Not disclosed

1(Reference only)
3 years:
2018-20-17.29%8

10 years:

2016-20-3.38%

2011-20
15.57%

Not disclosed

1
Not disclosed
182.94%
3

1
Not disclosed
22-4.86%
6.63%
7
7
7.63%
7.43%
5
5
Not disclosed
2
2
1.69%
2.68%
7
7
12.96%
20.94%
9912.01%
8
Not disclosed
1

5 years:

17

35

2

2

1
25.78%
3
7.88%
3
20.49%
8
12.47%
5

1

2

84
-

7.19%
48
7.39%

9.87%
45
2.15%

10.76%
41
5.50%

15.19%
38
9.60%

Considerations for horizon IRRs

10

Please consider the following when viewing the horizon IRRs

General explanation of horizon IRR
 In this survey, the “horizon IRR” means the annualized internal rate of return of funds
surveyed, grouped by vintage year, over 1 year (2020), 3 years (2018-20), 5 years(2016-20) and 10 years (2011-20) up to the end of 2020. Calculating IRRs over acertain time frame, while not very rigorous, enables the performance of private equity
funds, many of which are closed-end, to be compared to the performance of otherassets and benchmarks.
 The horizon IRR for each group of vintage years is calculated by aggregating the net
assets at the beginning and end of the measurement period and the cash flows during
the measurement period for the funds in each group.
 The horizon IRR for vintage year groups with fewer than three funds surveyed is notdisclosed to avoid identification of individual funds.
 “Number of funds surveyed” by vintage year includes the number of funds whichceased operations before the end of the measurement period (i.e. the end of 2020).
 Given the life cycle of private equity funds, most of which are operated for a period of
about 10 years, if the measurement period is short, the IRR is likely to be affected byinvestment collections on a specific few deals that occur during that period, and theIRR will be highly skewed. Therefore, IRRs for one-year and three-year horizons arecalculated for reference purpose only. (However, if fair value measurement isappropriately performed at every year-end as described on the right, IRRs for shortermeasurement periods will be more meaningful.) The horizon IRR of each vintage year group for each year is calculated for the funds
for which fiscal year ended in each calendar year (January 1 through December 31).
However, the IRR of the funds for which fiscal year ends in January, February or
March is included in the performance of the previous calendar year of the year inwhich the fiscal year end belongs.
 TOPIX Total Return Index is obtained from Bloomberg.

Difference and relationship between since-inception IRRs and horizon
IRRs
 The since-inception IRR is calculated by aggregating each fund’s all cash flows since
inception and the net assets at the end of the measurement period. The horizon IRR is
calculated by aggregating each fund’s net assets at the beginning and the end of themeasurement period and the actual cash flows during the measurement period, where
it is assumed the cash flow in the amount of the net assets occurred at the beginningof measurement period. Thus, the starting point of the calculation differs between thesince-inception IRR and the horizon IRR.

Fair value measurement of portfolio investments
 The horizon IRR is calculated as if there were cash flow in the amount of the fund's
net assets at the beginning of the measurement period, which may result in distortionsof the IRR depending on whether portfolio investments are measured at fair value asof the beginning date.
 For example, if a fund group includes a large number of funds which are performing
well but the portfolio investments are not measured at fair value, the horizon IRR ofthe group tends to be calculated relatively high. This is because the cash flows
deemed to have occurred at the beginning of the valuation period are the amount offund net assets based on acquisition cost, not fair value, while fair value measurement
does not affect the actual cash flows generated during the period (e.g. sales proceedsof investments).
 As an example of the specific horizon IRR, the 5-year IRR to the end of 2020 for theentire group of 41 target funds (10.76%) is calculated by aggregating the net assets at
the end of 2015 for all 41 target funds, assuming that cash flows in that amountoccurred on 1 January 2016, the beginning of the measurement period, andaggregating the actual cash flows of the funds from 2016 to 2020, and the net assets
as at 31 December 2020, the end of the measurement period. Whether or not theportfolio investments held are measured at fair value will affect both the amount offund net assets at the beginning and end of the valuation period.

Survey results: Total value to paid-in multiples

11

Total value to paid-in (TVPI) multiples as at the end of 2020 of the surveyed funds grouped by fundinception year (vintage year) shown in the table

Vintage year

Measurement Group

Number of funds surveyed

TVPI as at the end of 2020

Up to v.2008 Total

39

v. 20092

Not disclosed

v. 20101

Not disclosed

v. 20113

1.40x

v. 20123

1.56x

v. 20138

1.75x

v. 20145

1.79x

v. 20152

v. 2016

7

0.99x

v. 20179

1.43x

v. 2009-17 Total

40

1.50x

Up to v. 2017 Total

79

1.51x

(Reference only) v.2018

8

1.23x

(Reference only) v.2019

1(Reference only) v.2020

6

1.50x

Not disclosed

Not disclosed
0.94x

Considerations for total value to paid-in multiples
Please consider the following when viewing the TVPI multiples

General explanation of TVPI multiples
 The TVPI multiple as of the end of 2020 by vintage year is calculated using
the following method. The TVPI of the funds which ceased operations before
the end of 2020.
(1) Calculate the TVPI multiple of each fund using the following formula:
TVPI multiple＝Accumulated distributions + Residual value at the period end
Accumulated paid−in capital(2) Calculate the TVPI multiple by vintage year by weighting the TVPI
multiple of each fund with the accumulated paid-in capital The total figures are based on the funds of which vintage year is prior to 2017
(i.e. the funds that were more than three years old), aligning with the nature ofprivate equity funds that are designed to obtain medium-to-long-term returns.
The TVPI multiples for the funds launched in 2017 and thereafter are alsopresented for reference.
 The TVPI multiples for vintage year groups with fewer than three funds
surveyed is not disclosed to avoid identification of individual funds.
 Since the calculation of the TVPI multiples is not affected by time value ofmoney, TVPI multiples for a certain time frame are not calculated, while thehorizon returns are calculated for IRRs which are affected by time value ofmoney.

12

13Highlights

03

Survey overview

05

Survey results-

Since-inception IRRs

07-

Horizon IRRs

09-

Total value to paid-in multiples

11

Supplementary information-

Data collected for this survey

14-

Change of return calculation method

15-

Considerations for use of this survey

16-

List of participating companies

17Supplementary information: Data collected for this survey

1.

PwC Aarata, commissioned by JPEA, requested the participating companies by sending the letter “Data Request for Fund Performance Measurement”
to provide the following data:
Basic information of the funds surveyed•

Fund name•

Investment strategy and targets•

Size (commitment amount)•

Fiscal year end date•

Accounting standards•

Audit requirement•

Valuation method of the investees

 Cash flow data of the funds from inception to the end of the most recent fiscal period (for the liquidated or closed funds, to the end of the final fiscal
period or liquidation)
 Net asset value data of the funds as of the end of each fiscal period from inception to the most recent fiscal period (for the liquidated or closed funds, tothe final fiscal period or liquidation)
2.

The internal rate of return (hereinafter referred to as “IRR") is calculated using the following formula.
𝐼𝐼

0 = � 𝐶𝐶𝐶𝐶𝑖𝑖 (1 + 𝑟𝑟)
𝑖𝑖=1

−

𝑡𝑡 𝑖𝑖
365

+ 𝑉𝑉𝐸𝐸 (1 + 𝑟𝑟)

−

𝑇𝑇𝑇𝑇
365

𝐶𝐶𝐶𝐶𝑖𝑖 : i-th cash flow (-: inflow into the fund, +: outflow from the fund)𝑖𝑖 : Sequence of cash flow during the valuation period (1, 2, •••, I)
𝑟𝑟 : IRR
𝑡𝑡 𝑖𝑖 : Number of days from the first day of the valuation period to the i-th cash flow date
𝑉𝑉𝐸𝐸 : Value of the fund at the end of the valuation period
𝑇𝑇𝑇𝑇 : Number of total days in the evaluation period

14Supplementary information: Change of return calculation method

15

Some changes have been made to the return calculation method utilized in this FY2020 survey comparedwith that of prior years in light of global trends in investment performance measurement methods

Return calculation method through FY2019 (old method)

Return calculation method from FY2020 (new method)(1) Calculate IRR of each fund

(1) Assume one hypothetical fund where cash flows andvaluations of the funds surveyed are pooled(2) Calculate weighted average of IRR of the group by
each fund’s weight (*)

Comparison of old and new methods

 In the new method, fund size affects the return calculation
through the amount of cash flow, not the amount of the weight (*)
 If the return from one method is positive, the return from theother method can be negative Positive and negative returns from the new method areconsistent with positive and negative TVPI multiples
 When individual funds post significantly higher or lower returns,
returns under the new method generally tend to be more level( * ) W eight in the old method: each cash flow is weighted by the length of stay in the fund-W eight of Fund A: 10,000 * 100% = 10,000-

W eight of Fund B: 5,000 * 100% + 5,000 * 50% = 7,500(1st cash flow stayed in the fund for 4 years, and 2nd cash flow stayed in the fund for
2 years)(2) Calculate IRR of this hypothetical fundCalculation examples based on the old and new methods
Date

Fund A

Fund BIRR (New method)

2017/1/1(10,000)(5,000)(15,000)

2019/1/1

0(5,000)(5,000)2020/12/31

12,0008,200

20,200IRR

4.66%(6.47%)

0.28%

IRR of each fund

4.66%

(6.47%)(*)

10,0007,500

IRR (Old method):(0.11%)IRR (Old method)

WeightSupplementary information: Considerations for use of this survey

1.

This report does not disclose performance of any individual participating company or fund, and the information used in the preparation of this report will not be
disclosed to any other JPEA members and third parties other than PwC Aarata, a contractor for preparation of this report, except as set forth in the
Confidentiality Agreement between PwC Aarata and each participating company.

2.

The performance measurement made by PwC Aarata does not constitute an audit or assurance service, and PwC Aarata has not verified, validated or audited
the reliability or accuracy of data obtained from the participating companies.

3.

The funds in scope of this report are mainly the funds that invest in Japan, but include also the funds that invest mainly in Japan but have some foreign
investees. The funds also include carve-outs from global funds that have investments in Japan. However, the funds which invest in Japan as a small
proportion of their investment portfolio in comparison to global territories, for which the Japan portion cannot be carved out, are therefore excluded from thescope of this report.

4.

Valuation of investee companies are measured at fair value under International Financial Reporting Standards or U.S. GAAP, however, some funds measure
the investee companies at cost (minus impairment) or using certain valuation method specified in limited partnership agreements. Some funds may haveinvestments in the companies for which audited financial data is not available.

5.

The net asset value of each fund at the end of each period used to calculate the IRR is after deduction of the estimated carried interest and additional costs
that would be incurred if the investee were sold at the end of each period. However, these are not deducted for the funds for which such data are notavailable.

6.

The vintage year is generally defined as the year in which the first cash flow (initial drawdown) occurs. However, if it is impossible to calculate the IRR for theyear, such as when the first cash flow is close to the end of the year and/or only costs and expenses are paid in the first year, then the year in which the IRR
is first calculatable is the vintage year.

7.

The IRR is not disclosed if the number of the funds in each vintage year is less than three or if the number of the funds in each vintage year is three or more,
but all of these funds are managed by a single participating company. In addition, if the IRR of another fund can be estimated by disclosing the IRR, it is also
not disclosed.

8.

The IRR is calculated and presented on an annualised basis in principle. However, the IRR for the fund with a measurement period of less than one year is
not annualised.

16

List of participating companies

17

Participating companies (in alphabetical order)
Advantage Partners Inc.

Marunouchi Capital Inc.

Ant Capital Partners Co., Ltd.

MCP Partners Co., Ltd. (Formerly Mizuho Capital Partners Co., Ltd.)

Basic Capital Management, Limited

Mercuria Investment Co., Ltd.

Carlyle Japan, L.L.C.

New Horizon Capital Co., Ltd.

CAS Capital, Inc.

Nomura Capital Partners Co., Ltd.

CLSA Capital Partners (Japan) K.K.

Permira Advisors K.K.

Endeavor United Co., Ltd.

Ping An Japan Investment Co., Ltd.

iSigma Capital Corporation

Polaris Capital Group Co., Ltd.

Iwakaze Capital, Inc.

Rising Japan Equity, Inc.

J Will Partners, K.K.

T Capital Partners Co., Ltd.

Japan Industrial Solutions Co., Ltd.

Trustar Capital Partners Japan Limited (Formerly CITIC Capital Partners Japan Limited)

J-STAR Co., Ltd.

Unison Capital, Inc.

KKR Japan Limited

Yukon Capital Partners Co. Ltd.

The Longreach Group, Inc.

18

Disclaimer
The data within this report was measured by PricewaterhouseCoopers Aarata LLC (hereinafter referred to as “PwC Aarata”), which was commissioned by the Japan Private Equity
Association (hereinafter referred to as the "JPEA"), based on the data provided by the participating companies and the assumptions stated in "Supplementary information:
Considerations for use of this survey". The JPEA and PwC Aarata do not assume any responsibility for any inaccuracy in the data included in this report nor for the accuracy of theunderlying amounts submitted by the participating companies.
The performance measurement made by PwC Aarata does not constitute an audit or assurance service, and reliability, completeness or accuracy of the data used in the
preparation of the report, including the valuation data, has not been independently verified, validated or audited by PwC Aarata.
This publication has been prepared for provision of general information only, and does not constitute professional advice. You should not act upon the information contained in thispublication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information
contained in this publication, and, to the extent permitted by law, the JPEA and PwC Aarata, its member firms, its partners, employees and agents do not accept or assume any
liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any
decision based on it.
You are not allowed to make changes, additions or deletions to the contents in this report, including the names and brands of JPEA and PwC Aarata and this Disclaimer, for the
purpose of distribution of the modified report to third parties, without prior written consent of JPEA and PwC Aarata.
PwC refers to the PwC network member firms and/or their specified subsidiaries in Japan, and may sometimes refer to the PwC network. Each of such firms and subsidiaries is aseparate legal entity. Please see www.pwc.com/structure for further details.
This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.
© 2022 The Japan Private Equity Association. All rights reserved.