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What to Expect for Private Equity in 2023: Bloomberg TV Recap

As Seen in: Bloomberg

On December 23, 2022, Accordion’s CEO & Founder Nick Leopard appeared on Bloomberg TV to discuss his expectations for private equity in 2023.

On PE Activity
This interview first appeared on Bloomberg TV on December 23, 2022.

After a record fundraising year in 2021 and ‘slow but steady’ inflows in 2022, the PE industry is full of committed dry powder that will need to be invested. That money will likely be put to work in the second half of 2023.

“Deal count in [2022] was actually only down 16 percent when fundraising was down more than 50 percent. You’ve got to put this money to work in a finite period of time. Private equity funds are continuing to find very creative ways to do so.”

That means a likely increase in take privates, carve-outs, and add-on acquisitions.

On Turnaround & Restructuring

Accordion has seen PE funds lean in and put dollars behind restructuring their portfolio companies — including those that thrived during COVID but are now struggling to support top-line growth.

“It’s a different market from anything we’ve seen in the past… We’re doing a lot of turnaround & restructuring business with companies that are finding themselves with a bunch of floating-rate debt right now and companies that have just been mismanaged. There’s a lot of operational turnaround work happening.”

On Valuations

We’re going to see an emphasis on patient capital. PE funds will be patient with their spending and invest their time in the overall improvement of their portfolio companies.

“Multiple expansion was the single biggest driver of private equity over the last 20 years. So if you can’t rely on multiple expansion, you really need to focus on driving the bottom line performance.”

On Private Credit

The volume of private credit transactions slowed in 2022 (versus 2021, which was a record year for many direct lenders). However, the overwhelming majority of PE-style deals late in 2022 tapped the private market for deal financing.

“The real issue is that the syndicated market banks are sitting on a bunch of loans. The syndicated market is very slow right now, but there are a bunch of private credit funds who are now in the driver’s seat.”

On New Playbooks

When it comes to what PE funds are avoiding this year, the answer is the old playbooks.

“The private equity executives I speak with are no longer relying on the old playbooks. They’re much more focused on cash flow management, portfolio operations, and overall operational improvements.”


About Nick Leopard

Nick Leopard
Nick Leopard
CEO & Founder

Nick is the CEO & Founder of Accordion, a private equity-focused financial and technology consulting firm. Since founding Accordion in 2009, Nick has grown the company to serve more than 300 of the world’s premier private equity firms and their portfolio companies – providing services that span the entire CFO function. Accordion is headquartered in New York and has ten offices across the United States. Before Accordion, Nick worked at BHC Interim Funding, Bear Stearns, and CapitalSource Finance. Nick earned his BS in Finance from Saint Joseph’s University.  Read more

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