The Pulse of Private Equity – 5/22/2023

Founder-backed M&A is doing better


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Founder-owned businesses are more motivated to sell in the current environment. PitchBook’s latest Analyst Note, Founder-Owned Businesses are Attractive M&A Targets, found a sharp uptick for “nonbacked sellers”—companies with no private backing or corporate ownership. Companies backed by PE firms are, for the most part, on the sidelines. Market dislocations between buyers and sellers are the issue, and financial sponsors can’t afford to sell low and harm their IRRs.