Analyzing private equity, private credit & institutional capital. Join the weekly email list!
Joined January 2025
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Terrible news for private equity.
High inflation means high interest rates.
High rates mean record low exits and distributions will continue.
BREAKING: May PPI Inflation surges to 6.5%, above expectations of 6.4% and the highest level since November 2022.
Core PPI Inflation came in at 4.9%, in-line with April's revised levels.
PPI inflation is now at pandemic stimulus levels.
Odds of rate HIKES continue to rise.
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Power & utilities M&A tripled in ‘25.
Big tech, strategics, and PE are all racing to secure power for data centers.
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The credit market is more stressed than it seems.
> The riskiest borrowers are in private credit. Reporting is opaque, and amendments and PIK interest are used to avoid defaults.
> In the broadly syndicated market, LMEs have allowed tons of zombie companies to avoid bankruptcy.
Defaults and bankruptcies don’t give the full picture.
Pimco is warning that the “credit loss cycle is upon us” as heavy spending on artificial intelligence could widen economic outcomes and hit lower-quality borrowers bloomberg.com/news/articles/…
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Most critical skill in investment banking:
Attention to detail.
90% of the job is creating decks under intense stress and tight deadlines.
Error-free work is the main way junior employees are judged.
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EBITDA is inflated. 6.0x leverage today is very different than a decade ago.
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Median PE deal size is up 30% in ‘26.
Deal count is the lowest since ‘21.
Private equity is dominated by megadeals right now.
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Private credit is rotating.
Direct lending fundraising is down ~25%.
Opportunistic, asset-backed and secondaries are all growing.
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Most investment bankers flame out at analyst or right before MD.
You either can’t handle the lifestyle, or can’t bring in deals.
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Private equity and credit are stuck.
Secondaries are cashing in.
> Fundraising is up 11% YoY
> Credit secondaries tripled in ‘25
> Record 14% of PE exits are continuation vehicles
Secondaries are the newest liquidity bandaid.
Get the full primer ⬇️
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Software buyouts have tanked, as PE rotates into hard assets and services businesses.
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92% of companies miss their EBITDA projections
Why?
• ~30% of EBITDA is just addbacks
• Synergies are notoriously hard to realize
• Lending standards have loosened
EBITDA is increasingly fictional.
Get tomorrow’s full post ⬇️
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Private credit is replacing banks in the large cap space.
IG private credit / asset-backed deals are driving huge growth.
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