Articles & Papers

PE/VC Trends Report: Industrial Edition

Exploring Trends in Value Creation

GPs are adapting to a climate of uncertainty by developing different fund structures


"Private equity firms in Europe continue to navigate uncertainty in the financing environment resulting from a tense geopolitical situation, rising interest rates and high inflation. After a sharp decline, 2023 is seeing an easing of the situation with stronger growth and investment, and a focused approach on specialized funds. Overall, fundraising and divesting current investments are at the forefront. The industry is evolving at a strong pace, driven by an uncompromising pursuit to meet the dynamic demands of the market."

- Kathleen Dunton
EMEA Regional Leader, Private Equity & Venture Capital Practice
Managing Partner, Germany



GPs are diversifying their sources of growth and structuring funds to attract different investors


"We can see this at play in Asia. Family offices and HNWI see benefit in investing in PE funds, while the Fund Managers are seeking alternative sources of investment. Macroeconomic trends are a factor for this shift, but geopolitical factors cannot be overlooked. A great deal of private wealth has left China and found its way to Singapore and Malaysia. PE funds are, to many, ideal investment alternatives."

- William J. Farrell
APAC Regional Leader, Industrial & Private Equity & Venture Capital Practice
Managing Partner, Taiwan and South Korea



Economic downturn is prompting fund managers to construct resilient portfolios


"Portfolio companies have been heavily affected by the geopolitical climate and continued economic instability globally. However, PE backed companies and funds taking this opportunity of market uncertainty to invest, acquire and expand geographically. Having said that, the holding period for portfolio companies is expected to be longer, resulting in few exits. This cycle is inevitably slowing down fundraising which is shifting investor confidence to less risky assets such as real estate or private debt."

- Nessrine Salah
Managing Partner, UAE



Digital transformation has shifted from a risk management lever to a clear value driver


"Digital transformation can drive significant value for companies, but companies need to be deliberate, communicate effectively to all stakeholders and most of all prepare. Deloitte analyzed 10 years of financial disclosures from more than 4,000 global organizations and found that power of digital strategy, executed with specific technology investments, and organizationally equipped to accommodate change can meaningfully shift a company’s valuation.  This takes significant time, effort, and expertise – companies need to invest in the right talent both in terms of strategy and implementation. Having worked with organizations at various stages of their digital transformation process, we know how to identify the right talent for each company’s needs."

- John McCrea
Americas Regional Leader, Private Equity & Venture Capital Practice
Managing Partner, United States


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