Whilst private equity (PE) has experienced a challenging first half to the year – with Europe’s mega deals down to their lowest levels since 2013 – there are signs of green shoots appearing, and exciting activity across technology investment.
EY’s quarterly PE report shows that tech deals in Europe accounted for “one-quarter of PE’s total spend”. Key investment areas mimic that of the VC landscape – for example, cyber security is seeing a great deal of attention, along with a broader look at more traditional markets, where tech integration will become a key component in the near future.
Whisper it, but there is a more exciting theme appearing within the world of PE. Firms, in many cases, are still perceived by some as asset strippers that are solely focused on making fast returns. Many however, are moving towards a more conscious approach that focuses on long-term value creation. In fact, some might say that private equity managers (and investors) have started becoming concerned with value-add following a deal close, rather than just IRRs. This new era of conscious PE investors is very much aligned with the broader impact investing we now expect to see, and further PE investment into the technology space will only help this trend continue.
As the private investment landscape continues to evolve, we’re seeing new, exciting players enter the fast-growth technology space. With the reopening of the M&A market, PE will play a vital role in backing many of the technology companies that VCs have scaled over the past few years. As exit opportunities re-emerge, FieldHouse is increasingly supporting not only the VCs looking for their next exit, but the PE firms flowing into our space.
