The map below shows the concentration of private equity firms across various U.S. states, with obvious concentrations in New York, California, Texas, Illinois, Connecticut, Massachusetts and Florida (in that order).

The trending private equity investment sectors for September 2018 are highlighted below with a few example transactions.

I probed our private equity database to discover non-U.S. private equity firms that have made investments in U.S.-based companies. I wanted to know the primary industries of interest for these international financial sponsors over the past 12 months. The industry themes are shown below.

Our database at PrivateEquityInfo.com currently shows 259 U.S.-based private equity firms with current portfolio company investments in European countries. Of these European portfolio companies, 50% are concentrated in just 2 countries (UK & Germany).

In the past 12 months, we’ve had more customer inquiries about U.S. private equity firms investing in Latin America. Our database at www.PrivateEquityInfo.com currently shows 87 U.S.-based PE firms with current portfolio company investments in South & Central America (I excluded Mexico for this study… which would have added another 22 PE firms).

Of these portfolio company investments, 90% are concentrated in just 7 countries. More than half are in Brazil.

The trending private equity investment sectors for August 2018 are highlighted below with a few example transactions.

The challenge for all investment banks at any given time is cultivating quality deal flow. In this case, “quality deal flow” means businesses with these attributes:

1. Growing revenue streams, (preferably recurring)
2. Stable, increasing cash flow
3. Scalable
4. Non-cyclical products or services
5. Low CapEx required to achieve growth
6. An excellent management team
7. A diverse customer base
8. A motivate seller

With corporate valuations at historic highs (in 2018), business sellers operating “quality” businesses tend to have the mindset that they should hold longer. They delay an exit because cash flows are good, and the company continues to grow. Further, using the recent historical performance of their company to forecast growth prospects plus applying recent high valuation multiples, leads many company owners to rationalize that they should continue to grow the company because it will be worth even more in a year or two.

Over the past 12 months, private equity firms have been net acquirers of companies, making about 2.5 platform investments for every 1 platform exit. This significant growth in portfolio company ownership is buoyed by more private equity firms in the market and larger funds with more committed capital than ever before.

Contrary to this trend, 245 private equity firms in our database have taken advantage of the recent high valuations (relative to historical standards) and have become net exiters of portfolio companies over the last 12 months. Collectively, these 245 private equity firms exited 492 platform investments and only acquired 137 new platform companies – a ratio of 3.6 exits for every investment.

Instead of providing a general list of the Top 10 Private Equity Firms with the largest, well-known firms, I wanted to identify formidable acquirers that may be lesser-known. To do this, I normalized the number of platform acquisitions (2018 YTD) by the number of deal makers (titles of Vice President and higher) at each firm. The lists below show the top 10 most acquisitive private equity firms, grouped by deal team size.

I periodically update the private equity portfolio company holding periods study to track this trend over time. In March, I reported a slight downward trend in portfolio company holding durations.

With the addition of five more months of 2018 exits (through mid-August 2018), the holding period continues to decline, but now more pronounced.