GCG’s Q1 2023 Middle Market Private Equity Update provides an overview of the latest trends in the private equity market.

Key findings include the following:

• Private equity Q1 2023 deal value is down by 19 percent from 2022 on an annualized basis. PE deal volume is down 34 percent during this same timeframe. The lower end of the middle market is starting to feel the impact of rising rates and economic uncertainty.
• Private equity fundraising during Q1 2023 is at its lowest level since 2018. Given the rapidly rising interest rate environment and economic concerns, this is not a surprise.
• We anticipate that Private equity fundraising will continue to meet some resistance for the remainder of 2023. That said, we expect a strong flow of funds to move back into PE as we get into a more stabilized interest rate and economic environment.
• The overall Private Equity appetite for deals continues to thrive. Part of the decline is a lack of sellers entering the market. This is to be expected. We expect PE to raise funds and the market to turn as we enter 2024.
• We continue to believe that we are setting up for a significant upward movement in PE deals as we get into the 2024 – 2026 period. Uninvested PE capital, sellers entering the market, and a stabilization/reduction in interest rates will drive activity during these years.

Click here for the full update.

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