Tue, Jun 30, 2026
A A A
Welcome Guest
Free Trial RSS pod
Get FREE trial access to our award winning publications
Alternative Market Briefing

Private capital braces for economic slowdown

Thursday, January 02, 2020

Bailey McCann, Opalesque New York:

Preparations for a downturn are underway for the private equity and venture capital sectors, according to BDO's inaugural U.S. Private Capital Outlook. As they wait for the other shoe to drop, more than half of fund managers (50% of PE respondents and 54% of VC respondents) say they are being more selective when evaluating highly valued deals.

72% of private equity funds expect an economic downturn within two years. The venture capital industry is slightly more optimistic on timing, with just over half (56%) anticipating a downturn to hit within the next two years. However, that a bear market is coming is a foregone conclusion: 92% of PE and 87% of VC respondents expect a downturn to occur within four years-less than the length of most investment holding periods.

28% of PE respondents will be directing the most capital toward funding portfolio working capital needs over the next 12 months. This is up from less than 1% a year ago, when the vast majority directed the most capital toward new deals. A greater percentage of VC fund managers-41%-will be dedicating the most capital toward portfolio working capital needs.

"We're seeing private equity focus more on building businesses," said Scott Hendon, National Private Equity Industry Group Leader at BDO in an interview with Opalesque. "If there is a slowdown, GPs are looking at how they can optimize businesses and still achieve the growth that investors expect......................

To view our full article Click here

Previous Opalesque Exclusives                                  
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Nvidia extraordinary growth and the challenge of sustaining demanding valuations over time[more]

    Antonio Di Giacomo, Senior Market Analyst at XS.com, writes: Nvidia has established itself as one of the most extraordinary growth companies in the global technology sector. Over the past two fiscal years, its revenues have risen from levels close to $60 billion annually to well above $120 billi

  2. Secondaries take center stage: What the 2026 PE landscape means for GPs and investors[more]

    Matthias Knab, Opalesque for New Managers: The 2026 edition of Dechert's Global Private Equity Outlook - "Signs of a Gradual Thaw" - marks a notable shift in industry sentiment. After years of compr

  3. And, finally: Time to share it with the people[more]

    From Newsoftheweird: Leavenworth, Washington, has become a tourist destination because of the Bavarian theme businesses have adopted there, NPR reported. One shop, the Leavenworth Nutcracker Museum, houses the world's largest nutcracker collection, thanks to 101-year-old Arlene Wagner. Wagner sta

  4. Opalesque Exclusive: Private Markets Evergreen Funds - An Insider's View[more]

    Matthias Knab, Opalesque for New Managers: Private Markets Evergreen Funds: What Investors Need to Know Before They Dive In The democratization of private markets is well underway. Structural barriers t

  5. Opalesque Exclusive: Governance, Scale, and Boutique Resilience in a Consolidating Hedge Fund Industry[more]

    Matthias Knab, Opalesque for New Managers: The hedge fund industry has undergone significant consolidation in recent years, with capital increasingly concentrated among large multi-strategy platforms. Yet boutique m