Dealmaker Optimism Rebounds in Q3 as Private Equity Increases Projects in Portfolio Companies

BluWave, the business builders' platform that connects the private equity industry with best-in-class talent, industry consultants and service providers, today released its latest quarterly analysis, providing a forward-looking perspective into how U.S. dealmakers are positioning their portfolios over the next six to 18 months.

Key Q3 2023 trends identified in the BluWave PE Industry Insights Report include:

• The private equity industry is taking a more proactive and value-minded stance as deal flow begins to build.
• With inflation cooling and recession fears waning, key macroeconomic indicators are "growing enough" for PE to act boldly.
• PE firms focused on growth activities instead of cutting costs. One strong signal was the 20% year-over-year jump in sales & marketing-related value creation investments.
• BluWave reported a record 49% of private equity projects focused on Human Capital, a 36% rise from the previous year. PE firms are now seeking more strategic, growth-driven business leaders.

"Private equity is shifting from the back foot to the front foot. The third quarter marked a clear turning point: uncertainty took a back seat to opportunity. We've seen private equity firms invest more in value creation, doubling down on talent acquisition, more than at any point in the last twelve months," said Sean Mooney, founder and CEO of BluWave. "This strategic shift shows that private equity has called a market bottom. Dealmakers' actions in the third quarter reflect optimism and a forward-looking, long-term growth approach to value creation across the portfolio."

As the private equity industry presses the gas pedal on value creation strategies, specialized recruiters and interim executives are among the most in-demand initiatives. Human Capital accounted for 58 percent of all value creation activity in Q3, which marks an all-time high since BluWave began measuring in 2018.

"It's not just about the amount of hiring, but also the types of executives private equity is seeking," Mooney added. "Over the last month or two, we've seen many growth-oriented companies seeking ?visionary' executives who can guide the company five or more years into the future, as opposed to ?battle-tested' executives, who had been in high demand for the prior three quarters. That speaks to how private equity is shifting into growth mode."

Additionally, BluWave has found that private equity firms have become increasingly involved in mid-level hiring decisions. While private equity has traditionally taken an active role in selecting permanent C-suite executives and interim executives, PE firms are increasingly more proactive in placing mid-level hires across their portfolio companies, like VPs, managers and specialist professionals.

More than 500 top PE firms trust BluWave as their matchmaker to advance due diligence and value creation projects. The proprietary report captures industry trends revealed by the thousands of projects for which BluWave provides PE firms and their portfolio companies support.

To request a copy of the full report, please visit: https://www.bluwave.net/get-insights/

About BluWave
BluWave is the Business Builders' Network for private equity grade service provider needs. The company's platform combines concierge-like consultative support with technology, data and AI to expertly connect businesses with proven providers across due diligence, value creation and prep for sale. The BluWave Vettedtm network is an invite-only ecosystem of top-tier individuals and service-providing groups. Based in Nashville, Tennessee, BluWave ranks as one of America's fastest-growing companies and today serves more than 500 leading private equity firms and thousands of proactive businesses. Visit BluWave.net to learn more.

Visit BluWave.net to learn more.

About BluWave PE Industry Insights Report
More than 500 top PE firms trust BluWave as their go-to match-making resource for due diligence and value creation projects. The proprietary report captures industry trends revealed by the thousands of projects on which BluWave supports PE firms and their portfolio companies. BluWave has been capturing this data since Q1 2018 and released its first report in Q1 2019.