The prospect of a quick flip – selling a company for a healthy profit within two years of acquisition – is a source of both delight and despair to the private equity industry.

The delight arises from the wonderful things a quick flip will do for annualised returns. Sell a company for twice what you paid two years earlier and your return will be 41% a year, comfortably in the upper quartile of funds' performance, according to statistics published by the European Private Equity and Venture Capital Association. Wait a further three years for the same exit and your return falls to 15%, barely above average.