Private equity US market insights and trends

Themes, trends and insights on the US private equity landscape. Explore what leaders are positioning for in 2024.

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PE Pulse is a quarterly global report that provides data and insights on private equity market activity and trends. The following analysis dives deeper into how US respondents are experiencing the market, along with their sentiments on how 2023 came to a close. 

Deal activity,1 after witnessing a decline in 2H22, remained resilient in 2023 despite continued macroeconomic headwinds.

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    Deal value-volume for significant deals, US$100m and above

    • In Q1 of 2020, PE deal value is US$ 53b with 45 deals
    • In Q2 of 2020, PE deal value is US$ 14b with 27 deals
    • In Q3 of 2020, PE deal value is US$ 96b with 71 deals
    • In Q4 of 2020, PE deal value is US$ 94b with 71 deals
    • In Q1 of 2021, PE deal value is US$ 130b with 108 deals
    • In Q2 of 2021, PE deal value is US$ 161b with 93 deals
    • In Q3 of 2021, PE deal value is US$ 142b with 93 deals
    • In Q4 of 2021, PE deal value is US$ 124b with 74 deals
    • In Q1 of 2022, PE deal value is US$ 132b with 74 deals
    • In Q2 of 2022, PE deal value is US$ 121b with 71 deals
    • In Q3 of 2022, PE deal value is US$ 69b with 52 deals
    • In Q4 of 2022, PE deal value is US$ 46b with 38 deals
    • In Q1 of 2023, PE deal value is US$ 70b with 39 deals
    • In Q2 of 2023, PE deal value is US$ 63b with 39 deals
    • In Q3 of 2023, PE deal value is US$ 71b with 40 deals
    • In Q4 of 2023, PE deal value is US$ 34b with 25 deals

Take privates remain an important part of the market. The dislocation in the stock market has played a significant role in public-to-private transactions.

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    Percentage of take private (PE deals by value) vs. all other deal types from 2018-2023

    • In 2018, take privates contributed 24% in deal value
    • In 2019, take privates contributed 33% in deal value
    • In 2020, take privates contributed 12% in deal value
    • In 2021, take privates contributed 26% in deal value
    • In 2022, take privates contributed 43% in deal value
    • In 2023, take privates contributed 41% in deal value

Consumer overtook technology as the most favored sector for investments. Consumer sector companies remained resilient in the high inflation environment by adopting pricing and value chain strategies to offset cost increases, which made them attractive to PE investors.

% of deal volume by sector

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    Percentage of deal volume by sector in 2023 vs. 2022

    • For the Consumer sector, 27% in 2023 vs. 25% in 2022
    • For the Technology sector, 23% in 2023 vs. 30% in 2022
    • For the Materials sector, 12% in 2023 vs. 11% in 2022
    • For the Health Care sector, 9% in 2023 vs. 10% in 2022
    • For the Industrials sector, 9% in 2023 vs. 8% in 2022
    • For the Financials sector, 8% in 2023 vs. 6% in 2022
    • For the Utilities sector, 5% in 2023 vs. 4% in 2022
    • For other sectors that includes retail, oil and gas, telecom, and real estate, 7% in 2023 vs. 6% in 2022

While the exit environment remains challenging, general partners are turning to alternative liquidity options to distribute capital back to limited partners, such as continuation funds.

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    PE exits from 2020 to 2023

    • In Q1 of 2020, exit value of US$ 44b with exit count of 132
    • In Q2 of 2020, exit value of US$ 16b with exit count of 72
    • In Q3 of 2020, exit value of US$ 111b with exit count of 157
    • In Q4 of 2020, exit value of US$ 128b with exit count of 224
    • In Q1 of 2021, exit value of US$ 167b with exit count of 220
    • In Q2 of 2021, exit value of US$ 206b with exit count of 296
    • In Q3 of 2021, exit value of US$ 129b with exit count of 271
    • In Q4 of 2021, exit value of US$ 121b with exit count of 298
    • In Q1 of 2022, exit value of US$ 60b with exit count of 180
    • In Q2 of 2022, exit value of US$ 206b with exit count of 165
    • In Q3 of 2022, exit value of US$ 56b with exit count of 165
    • In Q4 of 2022, exit value of US$ 69b with exit count of 140
    • In Q1 of 2023, exit value of US$ 38b with exit count of 100
    • In Q2 of 2023, exit value of US$ 43b with exit count of 95
    • In Q3 of 2023, exit value of US$ 63b with exit count of 100
    • In Q4 of 2023, exit value of US$ 49b with exit count of 98

PE fundraising2 was resilient in 2023, with LPs inclined toward established general partners; fundraising remains a key concern for limited partners heading into 2024.

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    PE fundraising from 2020 to 2023

    • In Q1 of 2020, fund value raised is US$ 92b and fund count is 159
    • In Q2 of 2020, fund value raised is US$ 52b and fund count is 49
    • In Q3 of 2020, fund value raised is US$ 23b and fund count is 50
    • In Q4 of 2020, fund value raised is US$ 122b and fund count is 396
    • In Q1 of 2021, fund value raised is US$ 100b and fund count is 223
    • In Q2 of 2021, fund value raised is US$ 100b and fund count is 120
    • In Q3 of 2021, fund value raised is US$ 70b and fund count is 106
    • In Q4 of 2021, fund value raised is US$ 116b and fund count is 512
    • In Q1 of 2022, fund value raised is US$ 109b and fund count is 196
    • In Q2 of 2022, fund value raised is US$ 99b and fund count is 105
    • In Q3 of 2022, fund value raised is US$ 79b and fund count is 111
    • In Q4 of 2022, fund value raised is US$ 117b and fund count is 422
    • In Q1 of 2023, fund value raised is US$ 80b and fund count is 145
    • In Q2 of 2023, fund value raised is US$ 100b and fund count is 99
    • In Q3 of 2023, fund value raised is US$ 113b and fund count is 88
    • In Q4 of 2023, fund value raised is US$ 91b and fund count is 87

In the current macroeconomic headwinds, continuation funds are witnessing a rising interest as an alternative exit route, as traditional exit routes have contracted due to elevated interest rates and tight liquidity conditions.

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    GPs are turning to alternative liquidity options to distribute capital back to LPs despite the challenging exit environment

    • In 2013, value of exits through continuation fund is US$ 0.1b and number of exits is 1
    • In 2014, value of exits through continuation fund is US$ 0.3b and number of exits is 5
    • In 2015, value of exits through continuation fund is US$ 0.7b and number of exits is 2
    • In 2016, value of exits through continuation fund is US$ 0.1b and number of exits is 10
    • In 2017, value of exits through continuation fund is US$ 1.5b and number of exits is 11
    • In 2018, value of exits through continuation fund is US$ 3.1b and number of exits is 14
    • In 2019, value of exits through continuation fund is US$ 1.8b and number of exits is 15
    • In 2020, value of exits through continuation fund is US$ 7.4b and number of exits is 26
    • In 2021, value of exits through continuation fund is US$ 3.5b and number of exits is 42
    • In 2022, value of exits through continuation fund is US$ 6.9b and number of exits is 71
    • In 2023, value of exits through continuation fund is US$ 6.5b and number of exits is 71

FY23 fund volume by fund size range3 (n=378)

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    FY23 fund volume by fund size range

    • Twenty-one percent is less than US$ 100m
    • Thirty-six percent is US$100m – 500m
    • Twenty-nine percent is US$ 500m – 1b
    • Fourteen percent is US$ 1b and above

Quarterly US PE buyout capital raised with trailing four-quarter average and one-year forecast

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    US PE buyout capital raised, and trailing four-quarter capital raised from 2019-2024

    • In Q1 of 2019, US PE buyout capital raised is US$ 53b and trailing four-quarter buyout capital raised is US$ 32b
    • In Q2 of 2019, US PE buyout capital raised is US$ 27b and trailing four-quarter buyout capital raised is US$ 36b
    • In Q3 of 2019, US PE buyout capital raised is US$ 86b and trailing four-quarter buyout capital raised is US$ 49b
    • In Q4 of 2019, US PE buyout capital raised is US$ 70b and trailing four-quarter buyout capital raised is US$ 59b
    • In Q1 of 2020, US PE buyout capital raised is US$ 62b and trailing four-quarter buyout capital raised is US$ 61b
    • In Q2 of 2020, US PE buyout capital raised is US$ 30b and trailing four-quarter buyout capital raised is US$ 62b
    • In Q3 of 2020, US PE buyout capital raised is US$ 19b and trailing four-quarter buyout capital raised is US$ 45b
    • In Q4 of 2020, US PE buyout capital raised is US$ 60b and trailing four-quarter buyout capital raised is US$ 43b
    • In Q1 of 2021, US PE buyout capital raised is US$ 58b and trailing four-quarter buyout capital raised is US$ 42b
    • In Q2 of 2021, US PE buyout capital raised is US$ 57b and trailing four-quarter buyout capital raised is US$ 49b
    • In Q3 of 2021, US PE buyout capital raised is US$ 35b and trailing four-quarter buyout capital raised is US$ 53b
    • In Q4 of 2021, US PE buyout capital raised is US$ 41b and trailing four-quarter buyout capital raised is US$ 48b
    • In Q1 of 2022, US PE buyout capital raised is US$ 30b and trailing four-quarter buyout capital raised is US$ 41b
    • In Q2 of 2022, US PE buyout capital raised is US$ 84b and trailing four-quarter buyout capital raised is US$ 47b
    • In Q3 of 2022, US PE buyout capital raised is US$ 74b and trailing four-quarter buyout capital raised is US$ 57b
    • In Q4 of 2022, US PE buyout capital raised is US$ 47b and trailing four-quarter buyout capital raised is US$ 59b
    • In Q1 of 2023, US PE buyout capital raised is US$ 52b and trailing four-quarter buyout capital raised is US$ 64b
    • In Q2 of 2023, US PE buyout capital raised is US$ 52b and trailing four-quarter buyout capital raised is US$ 56b
    • In Q3 of 2023, US PE buyout capital raised is US$ 53b and trailing four-quarter buyout capital raised is US$ 51b
    • For Q4 of 2023, forecasted US PE buyout capital raised is US$ 42b and forecasted trailing four-quarter buyout capital raised is US$ 50b
    • For Q1 of 2024, forecasted US PE buyout capital raised is US$ 40b and forecasted trailing four-quarter buyout capital raised is US$ 47b
    • For Q2 of 2024, forecasted US PE buyout capital raised is US$ 41b and forecasted trailing four-quarter buyout capital raised is US$ 44b
    • For Q3 of 2024, forecasted US PE buyout capital raised is US$ 42b and forecasted trailing four-quarter buyout capital raised is US$ 41b

Sources: Dealogic, Pitchbook, EY Analysis.

1Deal activity indicates US PE significant deals (i.e., deals worth US$100m and above; 2Fundraising analysis is based on closed funds’ location and includes funds with disclosed size only; 3Only funds with disclosed fund size were included for the pie-chart analysis; 2023* represents data as of December 5, 2023; Others^ include retail, oil and gas, telecom and real estate.