Private Equity Dealmakers Gaining Confidence
Private equity GPs and LPs are more upbeat about getting deals done this year amid an improving economic environment, according to BluWave’s latest Private Equity Insights Report.
The data showed that in the second quarter of 2023, private equity firms increased their year-over-year portfolio company project activity related to sales and marketing by about 20%, compared with 10% in technology and 8% in human capital.
In the fourth quarter of 2023, private equity firms advanced diligence projects at a 38% greater rate than in the same period of 2022, and increased the amounts spent on due diligence projects by more than 25% during this same time, the report found.
BluWave believes the timing of these types of significant investments signals the early stages of a new economic cycle beginning.
“While we might not see new records for M&A activity in 2024, there are strong indications the private equity industry has already started gearing up for the next 6-8-year growth cycle,” said Sean Mooney, founder and CEO of BluWave.
The report is derived from an analysis of BluWave’s proprietary data involving thousands of projects across due diligence and value creation made by the private equity industry and its dealmakers.