Hellman & Friedman's Long-Term Play: Reshaping Private Equity Resilience in an Exit-Driven Era

In an industry increasingly fixated on rapid monetization, Hellman & Friedman (H&F) has carved a distinct path. While most private equity firms prioritize short-term exits to capitalize on market cycles, H&F has doubled down on a long-term investment philosophy, extending holding periods and leveraging alternative liquidity strategies. This divergence has sparked both admiration and skepticism, particularly as the firm navigates a market where corporate buyers and secondary transactions are reshaping exit dynamics.

A Contrarian Approach to Exit Timelines

Traditional private equity strategies emphasize holding companies for three to five years before exiting via IPOs, acquisitions, or secondary sales. However, H&F's average holding period—76 months globally and 87 months in Europe—far exceeds industry norms, according to Pitchbook dataVerisure Owner Hellman & Friedman Bucks Private Equity Conventions^[1]. CEO Patrick Healy has openly championed this shift, describing the firm's evolution from a “deal firm” to an “investment firm” focused on long-term value creationVerisure Owner Hellman & Friedman Bucks Private Equity Conventions^[1]. This approach allows H&F to avoid the pressure of immediate exits while maintaining control over its portfolio companies.

For example, H&F's 2013 acquisition of HUB International was recently valued at $29 billion after a $1.6 billion private IPO-style transactionVerisure Owner Hellman & Friedman Bucks Private Equity Conventions^[1]. Similarly, Verisure, acquired in 2011, is preparing for a public listing that could value it at over $23 billion. These strategies—often involving continuation vehicles or private IPOs—enable H&F to provide liquidity to limited partners (LPs) without fully divesting its stakes.

Navigating a Shifting Exit Landscape

The broader private equity market is witnessing a surge in corporate buyers, who now account for 48% of all exits in 2023Private Equity Exit Strategies And Market Trends 2025^[2]. These buyers often pay premium valuations—14.8x EV/EBITDA—compared to financial buyers, but require clear synergies to justify the pricePrivate Equity Exit Strategies And Market Trends 2025^[2]. H&F's long-term approach aligns with this trend, as extended holding periods allow portfolio companies to build capabilities (e.g., technological integration or geographic expansion) that enhance merger appeal.

Secondary market activity has also grown, reaching $180 billion in 2023Private Equity Exit Strategies And Market Trends 2025^[2], offering firms like H&F additional liquidity avenues. However, the firm has largely avoided secondary sales, opting instead for continuation vehicles—a strategy that preserves its ownership while enabling partial exits. This contrasts with peers like Apollo Global Management, where CEO Marc Rowan has advocated for faster exits in a challenging market environmentVerisure Owner Hellman & Friedman Bucks Private Equity Conventions^[1].

The Resilience Factor: Risks and Rewards

H&F's strategy is not without risks. The firm's tenth fund, for instance, has a net internal rate of return (IRR) of 5.9%, significantly below the 12% median for its vintage yearVerisure Owner Hellman & Friedman Bucks Private Equity Conventions^[1]. Some LPs have expressed concerns about the trade-off between long-term value and immediate returns. Yet, H&F's leadership remains steadfast, rejecting diversification into credit, real estate, or secondaries in favor of large-scale buyoutsVerisure Owner Hellman & Friedman Bucks Private Equity Conventions^[1].

This resilience is partly fueled by macroeconomic tailwinds. Middle-market M&A activity is rebounding as interest rate cuts and improved private company earnings create favorable conditionsHow to Ensure a Successful Private Equity Exit^[3]. H&F's extended holding periods position it to capitalize on these trends, as its portfolio companies mature into more attractive acquisition targets.

Conclusion: A Model for the Future?

Hellman & Friedman's approach challenges the conventional wisdom that private equity success hinges on rapid exits. By prioritizing long-term value creation and leveraging alternative liquidity tools, the firm has demonstrated a unique form of fund resilience. However, its strategy's viability depends on continued market confidence and the ability to outperform peers in a landscape where speed and flexibility are often prized. As the industry debates the merits of H&F's model, one thing is clear: the exit-driven market is evolving, and firms that adapt—or defy—norms will shape its future.