According to the latest report by Forvis Mazars, strategic cross-border growth and technological transformation are the primary factors that will enable the private equity (PE) sector to overcome recent crises. The firm has just released its global analysis, “Exploring New Investment Directions: Global Private Equity Report 2026,” outlining the industry’s trajectory for the coming year.
The findings, based on responses from over 800 PE professionals across six global regions, indicate that the industry is transitioning from a prolonged period of disruption into a more deliberate, strategic phase of value creation. The 2026 edition highlights improving market sentiment, increasing selectivity in capital allocation, and a marked rise in the importance of technology—particularly Artificial Intelligence (AI)—in both investment processes and operations.
Key Takeaways from the Report
- Strategy Execution as a Key Differentiator: PE firms are shifting focus from transaction scale and volume toward active value creation. Market leaders are prioritizing control, operational influence, and clearly defined growth levers across their portfolios.
- Stabilizing Portfolio Performance: Returns in 2026 reflect continuity rather than disruption. Exit performance largely mirrors last year’s figures, while the number of underperforming deals is declining, signaling a gradual return of confidence as valuation gaps narrow.
- Financing Dictates Deal Structuring and Exits: Tighter credit markets are shaping capital structures, add-on (build-up) strategies, and exit timing. Consequently, disciplined capital allocation and creative financing approaches have become vital for investors.
- Cross-Border Investments Fueling Growth: International deal activity remains a primary growth engine. Firms are venturing beyond domestic markets to access better investment opportunities, greater diversification, and higher returns.
- Technology at the Core of Value Creation: Tech-driven investing has moved to the global forefront. With the TMT (Technology, Media, and Telecommunications) sector becoming the most preferred investment area, digital infrastructure, AI, and operational support technologies are now essential tools for boosting portfolio performance.
Navigating Selective Market Stabilization
After years of macroeconomic and geopolitical turbulence, the PE market is showing signs of cautious stabilization. While financing conditions remain challenging and exit horizons are lengthening, firms report greater confidence in their portfolios and a more favorable growth environment.
Top challenges negatively impacting portfolio performance:
- 67% – Market and geopolitical uncertainty
- 48% – Operational complexity
- 23% – Misalignment with management boards
In response, PE firms are pivoting their strategies. Growth capital remains the dominant global strategy, with 73% of respondents focusing on growth investments—significantly outpacing leveraged buyouts (LBOs) at 49%. This reflects a preference for strategies that support expansion while offering flexibility in a high-cost capital environment.
Redefining Performance and Value Creation
While capital remains plentiful, deploying it effectively has become more difficult. The report notes a persistent imbalance between dry powder levels and the availability of attractive assets.
Key Indicators:
- 73% of respondents prioritize growth capital strategies over LBOs (49%).
- Financing constraints have increased; 58% of firms report that their build-up strategies have been affected (a 10-percentage-point increase from 2025).
- Most firms report they would have exited fewer than 10% of deals in the past, indicating both higher confidence and increased selectivity.
Technology Overtakes Finance as the Top Investment Target
A significant year-over-year shift in the 2026 data is the dominance of technology:
- TMT is now the most-cited sector globally (58%), narrowly beating out Financial Services (57%).
- Investors are prioritizing tech-enabled capabilities to ensure portfolio resilience and scalable growth.
Operational Depth and Extended Holding Periods
With slower M&A processes, firms are leaning harder on operational value levers:
- Portfolio performance often dips at the three-year mark but improves significantly by the exit stage, highlighting the role of late-cycle value creation.
- 69% of firms are extending fund lifecycles to manage fundraising pressure, up from 54% in 2025.
Expert Commentary
Matthieu Boyé, Head of Private Equity, Forvis Mazars Group:
“Private equity participants are showing great adaptability. After a period of limited activity, buyers and sellers are showing a cautious readiness to close deals, albeit with a more disciplined formula. Capital is being allocated with much higher precision.”
Pere Mioč, CEE Private Equity Co-Lead, Forvis Mazars:
“The study shows strong dynamics in sectors where the CEE region is already seeing growth—specifically tech, energy, and defense—underlining the region’s strategic importance.”
Maciej Ptak, National Private Equity Lead, Forvis Mazars in Poland:
“The market is returning to activity in a more mature form. There is less emphasis on deal timing and more focus on actions that actually build investment value. Company fundamentals are now the primary driver of investment decisions.”
Scott Linch, Managing Partner, Forvis Mazars Capital Advisors (USA):
“The sector is entering a phase defined less by momentum and more by judgment. Those who can translate strategy into execution and demonstrate asset-level resilience are best positioned for the evolving market.”
About the Study
The Global Private Equity Report 2026 is based on a survey conducted in late 2025 among 806 representatives of the global PE ecosystem, including PE funds, family offices, asset managers, and institutional investors across six continents.
