You do not have to be a multi-millionaire or a chief executive looking for a job with a pot of gold at the end of it to benefit from private equity deals, say the bosses at SVG Capital, a FTSE 250 company set up nine years ago to invest purely in the sector.

'The returns from private equity investments are consistently higher than the general stock market delivers,' says Nick Ferguson, chief executive and chairman-elect of SVG Capital. 'I can seen no reason to invest in private equity unless you get higher returns. There is no point otherwise.'

Ferguson and his colleague, Andrew Williams, left Schroders to join SVG in 2001. 'We commissioned a study and found that the fastest-growing and largest sector was high net worth individuals. This tied in with what we knew: that there were investors who wanted a piece of private equity but who could not get in to deals because they did not have the $10 million minimum stake.

'Our whole purpose is to provide easy access to top-quality private equity for private savers. The direction of our marketing for the past three or four years has been towards those people. We knew they were happy to look at alternative assets because they were the drivers buying hedge funds and property.'

Even allowing for the dotcom bubble bursting, Ferguson and Williams say that the track record in private equity investment has been solid. 'It is hard to lose money in private equity investment although some do better than others,' says Ferguson. 'Two of the most successful funds in America in anybody's league table are the Yale Endowment and Harvard Endowment funds. Yale has between 15 to 22 per cent in private equity historically and currently 17.5 per cent in its model. Yale was up 19.2 per cent last year.

'Endowments are a good parallel for private investors. They have to pay current expenses, such as scholarships and new labs, but also have to save for the future. Private savers should position their portfolios this way, and managers at, for example, Morgan Stanley and Goldman Sachs, are coming around to this.'

SVG outperformed the stock market by 14 per cent last year. It has averaged 13.2 per cent above the stock market in each of the nine years since it was founded in 1996. SVG Capital is not alone in this field. Its full-year results for 2004 show that Candover, HG Capital and Pantheon have also outperformed the FTSE All Shares index for the past four years, with Graphite and Electra tracking it closely.