What are current trends in the mid-market PE market (2024/2025)?
Three trends shape the mid-market in 2024/2025.
higher rates make LBO financing more expensive. Multiples sit 0.5–1.0x below the 2021 peak.
Family succession remains the most important deal source — over 60% of mid-market deals (<$500m EV) come from succession situations.
ESG compliance is no longer optional. EU insurers cannot invest without SFDR conformity (the Sustainable Finance Disclosure Regulation).
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| Sector | 2021 | 2024 |
|---|---|---|
| Industrials | 9–10x | 8–9.5x |
| Healthcare | 12–13x | 11–12.5x |
| Tech / SaaS | 14–16x | 11–13x |
| Consumer | 9–10x | 8–9x |
Tech and SaaS fell the most, because 2021 growth pricing was unsustainable. Industrials and consumer held relatively stable.
the LBOs of 2019–2021 now need refinancing — at markedly higher coupons. Sponsors with weak operating performance run into trouble here.
Question: "Which trend shapes your investment thesis for 2024/2025?"
Answer: "Three quick points: a higher cost of capital reduces multiple inflation, family succession stays a structural source of mid-market deals, and ESG integration has become mandatory. Close with: the mid-cap remains the sweet spot, because international PE competition cannot offset the succession demographics."