Burgiss Private Capital Classification System
Necessity is the Mother of Invention
Formal standards underpin the progress of nearly every segment of commerce, but private capital is a notable laggard. Everyone in the industry agrees on the need for standards, but despite earnest efforts, little progress has been made by industry groups.
When we first began to create and assemble a database of fund performance, the dual problems of fund identity and classification were at the top of our agenda and we had to invent our way out of them. You can’t create a benchmark for European Buyouts unless you reliably classify funds as being in Europe and having a focus on Buyouts. But what makes a Buyout fund a Buyout fund? What is the "definition" of Europe?
The Burgiss Private Capital Classification System (PCCS), first published in 2016, is a set of taxonomies and the rules that govern them. The accompanying chart shows how we use the PCCS to identify a fund as Buyout.
In part because the PCCS is transparent, uses an objective approach and has a formal change process, it has also been embraced by large swaths of the academic community, who use the Burgiss Manager Universe (BMU) for independent research into private capital and implicitly accept their definition and assignment. Here is a partial list of research from this collaboration.
And even more pervasively, there are hundreds of institutions across the globe using this the PCCS through their adoption or use of the Burgiss Manager Universe data, including those that subscribe to 3rd-Party risk models that use Burgiss data. Of course, as with any mature classification system, the PCCS is subject to yearly review and revision.