The Turbulent Deal Landscape Continues in 2023, but the Future Appears Brighter -

As predicted in last year’s Looking Ahead Guide, 2023 has proven to be a tough year for dealmakers. Through the first half of 2023, the themes of 2022 (reduced deal volume and more competition for private equity deals) continued to cause the deal landscape to be exceedingly tough. According to Bain & Company’s Private Equity Midyear Report 2023, “uncertainty is the enemy of dealmaking, and uncertainty has been swirling through global markets in abundance.” Geopolitical uncertainty, continued rising interest rates, and a banking crisis have all played roles in decreasing deal flow. In fact, dealmaking has declined in four of the last six quarters. Since peaking in Q4 2021, quarterly volumes are now down 24% by deal count and 49.2% by deal value (according to PitchBook’s Q2 2023 US PE Breakdown) and exit activity has fallen 75% from peak (2021) to trough on a quarterly basis, showing no signs of improving over the next several quarters.