Private equity: investments and exits are slowing down. Fund-raising is concentrated on large funds

The total value of exits in the second quarter of 2026 in the global private equity sector fell by 19.7% compared with the previous quarter, standing at $275.2 billion, whilst the number of transactions fell slightly to 948. Since the start of the year, the pace of exits has been broadly in line with that recorded in 2025, dampening the sector’s expectations of a more dynamic exit market in 2026. The recovery in exits will be the main theme of the second half of 2026, as the raising of new capital will depend on managers’ ability to generate distributions to investors

The sluggishness of divestment activity has resulted in a fundraising market characterised by intense competition. Global capital raising in private equity, however, shows a growing divergence between the amount of capital raised and the number of closed-end funds. Since the start of the year, $261.8 billion has been raised, at a rate approximately 17% higher than that of 2025. During the same period, just 310 funds were closed; if confirmed, this figure would bring the annual total to its lowest level in the last ten years, representing a year-on-year decline of around 25 per cent.

Institutional investors, therefore, continue to show a strong interest in private equity as an asset class, but are increasingly favouring managers with established operational experience and a proven track record of creating value over the long term. This trend is contributing to a further concentration of the market in the hands of the major global players, whilst smaller funds or those without a solid track record are facing increasing difficulties in raising new capital. The investor selection process therefore appears to be significantly more rigorous than in previous years, favouring highly specialised strategies and distinctive sector expertise.

The theme of artificial intelligence dominates the entire landscape, and is playing an increasingly central role in the investment strategies of private equity funds, according to analysis by PitchBook. The adoption of AI represents not only an investment opportunity in specific technology companies, but above all a tool for creating operational value within companies already in the portfolios. The automation of business processes, improving operational efficiency, optimising commercial activities and supporting decision-making processes all help to increase the profitability of portfolio companies and sustain growth in earnings before interest, taxes, depreciation and amortisation (EBITDA), even in an environment characterised by limited growth in market multiples. This shift highlights how value creation is progressively moving away from financial engineering towards the tangible improvement of the industrial performance of the portfolio companies.

From a valuation perspective, the market appears to have reached a state of greater equilibrium compared with the significant correction seen between 2022 and 2024. Whilst there remains a marked divergence between different sectors, valuations now appear more consistent with the new interest rate environment and the growth outlook for the global economy. Companies operating in the most innovative technology sectors continue to benefit from above-average valuations, whilst the more cyclical sectors remain subject to greater price pressure. This divergence reflects investors’ growing focus on asset quality and their ability to generate sustainable growth over the medium to long term.