BDO’s 7 Private Equity Predictions for 2023

The upward trajectory of dealmaking that began in the fourth quarter of 2020 and sustained through 2021 did not continue in 2022. While the first half of the year started off strong, Q3 volume and value dropped significantly before rebounding slightly in Q4.

“Uncertainty” is the keyword at the beginning of 2023. Rising interest rates, inflation and geopolitical strife continue to challenge economic and market stability. However, with approximately $1 trillion in committed capital sitting on the sidelines, deals will still need to be made.

So, what’s in store for 2023? Will “low-quality” companies make up a greater proportion of deal volume? Will the gaps between buyers and sellers narrow? Will the Federal Reserve begin lowering interest rates? BDO’s private equity industry group examines some of the trends they believe will play out over the next 12 months.