Private Equity Industry Outlook for 2024: Increased Interest in Private Credit and AI in Deal Sourcing
Private Equity Industry Shows Optimism for 2024 with Increased Interest in Private Credit and AI
The private equity industry is gearing up for a promising year in 2024, as revealed by the S&P Global Market Intelligence 2024 Private Equity and Venture Capital Outlook. Despite shifting market dynamics, private equity executives are showing resilience and optimism, with 60% expecting an improvement in deal activity compared to 34% last year.
One of the key findings from the outlook is the increased interest in private credit asset allocations. According to the survey, 61% of limited partners (LPs) investing in private markets reported that they will increase their asset allocation to private credit in 2024. This shift indicates a growing appetite for alternative investment strategies within the industry.
Moreover, artificial intelligence (AI) is set to play a larger role in deal sourcing and target selection. While fund managers currently prioritize personal networks and referrals for sourcing investment opportunities, 54% of GP investment professionals foresee AI influencing these processes in the future. This adoption of AI technology reflects a trend towards more data-driven decision-making in the private equity space.
Additionally, the outlook highlights the resilience of mid-tier and smaller private equity firms, which are more optimistic about deal activity picking up in 2024 compared to their larger peers. Furthermore, private equity GPs are expanding their use of private credit in deal financing, with 37% reporting an increase in the past year.
Overall, the industry remains adaptable and poised for growth in 2024, despite lingering macroeconomic challenges. The survey, which covered global private equity, venture capital, and limited partner respondents, provides valuable insights into the trends and strategies shaping the private equity landscape for the year ahead.
For more information on the 2024 Private Equity and Venture Capital Outlook, please contact [email protected].
About S&P Global Market Intelligence:
S&P Global Market Intelligence is a division of S&P Global, a leading provider of credit ratings, benchmarks, analytics, and workflow solutions in the global capital, commodity, and automotive markets. With a focus on delivering accurate and insightful information, S&P Global Market Intelligence helps organizations make informed decisions and navigate the economic landscape effectively.
Media Contact:
Amanda Oey
S&P Global Market Intelligence
P. +1 212 438-1904
E. [email protected] or [email protected]
SOURCE S&P Global Market Intelligence