Private Equity’s Growing Share in Tech Acquisitions [Data Inside]

Private equity is no longer sitting on the sidelines when it comes to tech. It’s not just dipping its toes in — it’s diving in headfirst. The numbers speak for themselves. In this article, we’ll unpack some of the most important stats about how private equity (PE) is becoming a dominant force in technology acquisitions. Each stat tells a story, and we’re here to break down what it means, why it matters, and how you can use that insight to make better strategic decisions.

1. Private equity accounted for 45% of global tech M&A deal value in 2023, up from 30% in 2019

What does this shift mean for the industry?

Back in 2019, private equity had a modest but growing presence in tech M&A. Fast forward to 2023, and nearly half of all deal value in tech mergers and acquisitions came from PE firms. That’s a seismic shift. This isn’t just a trend — it’s a transformation.

PE firms have traditionally been strong in sectors like manufacturing or retail, but tech was often seen as too fast-moving, too unpredictable. Not anymore. With the rise of recurring revenue models and data-driven operations, tech companies now offer the kind of financial predictability PE investors crave.

How should founders respond?

If you’re a startup or a growth-stage tech company, this stat should make you think differently about your future. PE buyers are no longer just for distressed companies. They are actively looking for healthy, scalable businesses. So here’s what you can do:

• Get your financials clean and clear. PE firms are detail-driven. Your P&L, balance sheet, and customer retention metrics need to be airtight.
• Build for predictability. Subscription models, long-term contracts, and sticky customers make you a prime acquisition target.
• Start networking early. Build relationships with PE firms now, even if you’re not looking to sell yet.

What does it mean for strategic buyers?

If you’re a corporate development executive at a tech company, PE’s rise means more competition. Deals will move faster, valuations may stretch higher, and diligence windows may shrink. It’s time to adapt.

2. In 2022, PE firms participated in 60% of $1B+ tech deals globally

Big tech, big money

When the stakes are high — like in billion-dollar-plus deals — you’d expect big-name strategics to lead the charge. But in 2022, PE firms were in on 60% of those mega-deals. That means they’re not just shopping small. They’re placing massive bets on tech.

These firms are setting up specialized funds just for large tech buyouts. They’re hiring operators from the tech world. They’re building in-house tech teams to better understand the sector.

What makes a $1B+ tech deal attractive to PE?

Three things: maturity, scalability, and systems. The targets are often late-stage or public companies that can be taken private. They have loyal customer bases and strong cash flows. PE firms believe they can cut costs, improve margins, and resell or IPO them in a few years.

If your company is in that late growth stage and crossing into nine-figure revenue territory, PE firms are likely watching.

How to prepare for a potential approach:

• Be aware of your valuation triggers. A certain ARR (annual recurring revenue) threshold or EBITDA margin can put you on a PE radar.
• Strengthen your leadership bench. PE buyers often look for teams that can manage rapid change.
• Get smart on PE motivations. Understand how they think, so you can negotiate better when the time comes.

3. The number of tech companies owned by private equity tripled between 2015 and 2022

The silent takeover

It’s not just about the deals being announced — it’s about who owns what once the dust settles. Between 2015 and 2022, the number of tech companies under PE ownership tripled. That means more tech companies today are managed, scaled, and resold by private equity than ever before.

Private equity has gone from a minor presence to a dominant ownership model in tech. It’s quietly changing how software companies grow, how SaaS firms price, and how product teams prioritize features.

Why are PE firms doubling down on tech?

Because it scales. A successful PE playbook in tech might involve:

• Buying a vertical SaaS company
• Cutting costs by 10–20%
• Layering on complementary add-ons via M&A
• Doubling the customer base through better GTM strategies
• Selling at a higher multiple after 4–5 years

This model works well when the underlying asset is strong — which is often the case with niche tech companies.

What’s the catch?

PE ownership is not always rosy. Some employees may feel the pressure of operational changes. Budgets may be scrutinized more closely. But for founders and early investors, it can be a great liquidity moment.

If you’re considering PE as an exit option, understand what kind of operator they are. Some firms are hands-off, while others get deep into daily operations.

4. U.S.-based PE firms closed over 1,200 tech acquisitions in 2023 alone

America leads the charge

Over 1,200 tech deals in one year — that’s more than three deals a day. This stat shows that U.S.-based private equity firms aren’t just active in tech, they’re dominating the space. And it’s not just quantity. Many of these acquisitions were complex carve-outs, international roll-ups, or highly strategic platform investments.

PE in the U.S. has deep roots, vast capital pools, and now, a sharp focus on tech. Whether it’s enterprise software, data security, AI tools, or even developer platforms — PE firms are buying fast.

What does this mean for founders and operators?

If your company is headquartered in the U.S. or even just sells into the U.S. market, you’re in the epicenter of PE activity. This makes your company more visible and potentially more valuable.

Here’s what to consider:

• Position yourself as a platform. Many PE firms want to make one large acquisition and bolt smaller ones onto it. If your company can serve as that “hub,” your valuation can rise fast.
• Stay acquisition-ready. Even if you’re not selling now, having clean contracts, structured financials, and stable churn metrics will speed up future discussions.
• Understand U.S. deal dynamics. The deal culture in the U.S. tends to move fast. Decision cycles can be short. You need to be prepared to engage when the opportunity knocks.

5. From 2020 to 2023, PE-backed tech buyouts grew at a CAGR of 17%

Fast growth in uncertain times

While many sectors saw slower growth during the pandemic, private equity-backed tech buyouts were soaring. With a compound annual growth rate (CAGR) of 17% from 2020 to 2023, this is not just cyclical behavior — it’s a fundamental trend.

PE firms took advantage of lower valuations in 2020, then capitalized on tech’s boom. Even as public tech stocks fluctuated, buyouts provided more stable investment returns. Investors appreciated the controlled environments of private ownership.

What are the drivers behind this growth?

• Predictable revenue streams. SaaS and other subscription models became safer bets.
• Digital transformation. COVID accelerated demand for cloud, security, and automation tools — prime targets for PE.
• Deal execution capability. PE firms adapted fast with virtual due diligence, remote integration, and global deal teams.

What should you do?

If you’re an early-stage founder, this is a signal to build for exit from day one. Focus on:

• Scalable systems. PE firms love companies that are efficient and tech-enabled across finance, ops, and HR.
• Retention metrics. Strong net revenue retention (NRR) increases your attractiveness as a target.
• Low customer acquisition cost (CAC). Efficiency is key in the PE world.

6. In 2023, software firms made up 70% of tech acquisitions by PE firms

The SaaS magnet

It’s no secret that private equity loves software. But when 70% of their tech deals go to software companies, it’s clear where the priority lies. Software, especially cloud-based and recurring-revenue models, gives PE firms the visibility and margin profile they want.

This includes everything from niche vertical SaaS to ERP platforms to cybersecurity solutions. If your company writes code and sells licenses or subscriptions, you’re in the sweet spot.

Why does software dominate?

• High gross margins. Most SaaS firms run at 70–90% gross margins.
• Low churn with sticky products. Once software is embedded, companies rarely switch.
• Scalability. Tech infra can support rapid growth without ballooning costs.

Tips for software founders:

• Highlight your revenue quality. Break down recurring vs. non-recurring streams.
• Build around customer stickiness. Expand your product’s use cases within existing accounts.
• Optimize pricing and packaging. PE firms often rework pricing post-acquisition — get ahead of it now.

7. The median EBITDA multiple paid by PE buyers in tech rose to 17x in 2021, up from 12x in 2016

Valuations are rising

Private equity used to be associated with bargain hunting. But that’s changing. In tech, especially, PE firms are paying more — with median EBITDA multiples rising from 12x to 17x over five years.

That means PE firms are no longer just looking for discounted deals. They’re willing to pay a premium if the company shows strong financials, growth, and operational upside.

What’s driving the increase?

• Competition. More PE players chasing the same tech assets.
• Better targets. Tech companies are more mature and financially attractive.
• High-quality revenue. Predictable ARR and good margins justify higher multiples.

How can founders maximize their valuation?

• Know your numbers. Understand what levers drive your EBITDA multiple — and improve them.
• Identify operational wins. If a buyer sees ways to improve your business post-acquisition, they’ll pay more now.
• Don’t undervalue yourself. If you’re profitable and growing, there’s no need to discount for a fast exit.

8. Dry powder for tech-focused PE funds reached over $300 billion in 2023

Cash is waiting to be deployed

Dry powder — unspent capital waiting to be invested — is a strong indicator of future deal activity. And with $300 billion earmarked for tech investments, PE firms are sitting on war chests they need to deploy.

This isn’t idle money. PE investors have timelines and return expectations. That capital will be spent, and the tech industry will see even more aggressive deal-making.

How does this affect sellers?

• More competition among buyers. This can push valuations higher and give sellers more leverage.
• Faster deal timelines. Funds need to deploy capital, so they move quickly when they find the right fit.
• Broader interest. Even smaller or less mature companies may now attract attention.

Actionable steps:

• Build relationships with PE firms now. Don’t wait for them to come to you — show up on their radar.
• Be clear about your goals. Not all capital is the same. Align with firms that match your vision.
• Prepare your pitch deck. Even if you’re not raising money or selling, have a clean overview of your metrics, market, and financials ready.

9. Between 2021–2023, more than 40% of all tech take-privates were PE-led

The take-private boom

A take-private transaction is when a public company is bought and delisted — and private equity is leading the charge. Over 40% of these in tech from 2021 to 2023 were done by PE buyers.

Many public tech companies saw their valuations slump post-IPO or during market corrections. PE firms saw opportunities to scoop them up at attractive prices, restructure, and grow them out of the public eye.

Why is this significant?

• Fewer distractions. PE owners can help tech firms focus without quarterly earnings pressure.
• Faster decisions. No need for board or shareholder consensus.
• Room to experiment. Private firms can make bold moves that public ones may hesitate on.

If you’re a public tech firm:

• Be alert to unsolicited offers. PE buyers often move quietly and suddenly.
• Know your break-up value. Sometimes your parts are worth more than your market cap.
• Engage with investor relations experts. They can help shape your narrative and valuation in the market.

10. 75% of tech platform roll-ups in 2022 were backed by private equity

PE and the roll-up playbook

A roll-up strategy involves acquiring multiple smaller companies in the same or adjacent markets to build a larger, more powerful entity. In 2022, three out of every four tech roll-ups had private equity behind them. That’s no coincidence — PE firms love this model.

Why? Because it creates scale, improves margins, and increases exit value. With the right execution, a $50 million platform can become a $500 million player in just a few years.

How does a roll-up work in tech?

Imagine a PE firm buys a mid-sized SaaS company serving healthcare clinics. Then they acquire four smaller competitors, a few add-on services, and perhaps a marketing tech company to bundle in. Now they’ve got an ecosystem — not just a product.

The roll-up becomes more defensible and more attractive to strategic buyers down the line.

What should founders do?

• Think like a platform. Can your product serve as the foundation for future acquisitions?
• Niche down before scaling. PE firms love companies that dominate a narrow vertical.
• Get clear on your integration strengths. If your company can absorb others smoothly, that’s a selling point.

Even if you’re not interested in being rolled up, understanding how these deals work helps you position better in a market that’s increasingly shaped by PE.

11. $125B in global tech M&A deal value in 2023 was driven by PE sponsors

A big slice of a big pie

In 2023, private equity was behind $125 billion worth of tech M&A deals. That’s not just a few opportunistic buys — it’s a major chunk of global deal flow. PE isn’t playing second fiddle anymore; it’s shaping the entire tech transaction landscape.

That kind of capital inflow means PE sponsors aren’t just investing — they’re guiding strategy, shifting valuations, and setting deal terms.

What does this scale mean for you?

• More inbound interest. If your company is growing and profitable, expect attention from PE.
• Greater competition among acquirers. Strategic buyers now regularly lose out to PE bidders.
• Different post-deal expectations. PE buyers may have more aggressive growth plans than corporates.

Tactical advice for companies in growth mode:

• Track market comps. Understand how similar companies are being valued.
• Build a PE outreach list. Don’t wait for intros — you can reach out proactively.
• Know your exit options. IPO isn’t the only path. A PE deal might offer better economics and less dilution.

12. PE-led tech deals in Europe increased by 38% year-over-year in 2023

Europe becomes a PE hotspot

While North America still leads in volume, Europe is quickly becoming a favored hunting ground for tech-focused private equity. In 2023, deals in the region jumped 38% year-over-year. That’s huge growth, especially in a continent known for slower tech adoption and conservative capital.

From Nordic SaaS startups to German enterprise platforms and UK fintechs, Europe is now squarely on the PE map.

What’s behind the growth?

• Valuation arbitrage. European startups are often cheaper than U.S. peers.
• Underserved markets. Many EU tech firms haven’t scaled globally yet — PE sees opportunity.
• Regulatory support. New reforms and cross-border M&A frameworks make deals easier.

What this means for European founders:

• Expect more U.S. buyer interest. American PE firms are setting up offices and looking abroad.
• Focus on global readiness. PE firms love companies they can scale internationally.
• Polish your legal and tax structure. International buyers need clarity — clean up cap tables and IP rights.

Europe’s tech landscape is maturing, and PE is speeding up that process.

13. In 2023, PE exits in the tech sector dropped by 20%, but buyouts remained strong

Holding longer, buying harder

Even though exits dipped 20% in 2023 — thanks to a tough IPO market and cautious strategics — buyouts by PE firms didn’t slow down. In fact, they surged. Why? Because many PE players saw this as a buying window. Cheaper valuations meant better entry points.

Instead of selling, many firms chose to double down: buying more, extending hold periods, and focusing on operational improvements.

What should this tell founders?

• Don’t panic about a frozen exit market. PE is still active — but they’re more focused on value.
• Be patient. Exits may take longer, but good deals still happen.
• Emphasize efficiency. Buyers today care more about margin than growth-at-all-costs.

Tips for navigating a slower exit climate:

• Model longer-term scenarios. Don’t bank on a quick flip — optimize for resilience.
• Consider partial liquidity. PE often offers deals where founders can cash out some now and stay on to grow.
• Get your narrative right. Buyers need confidence that you’re not just surviving but thriving.

Exits may have cooled, but the appetite to acquire — especially at the right price — remains hot.

14. Cybersecurity startups accounted for 15% of PE tech deals in 2022

Security is PE’s new obsession

Cybersecurity isn’t just a tech trend — it’s a critical investment theme. In 2022, 15% of all PE tech deals involved security startups. That’s a large chunk for such a specific sector.

From endpoint protection to identity management, PE firms are betting big on the tools that defend digital infrastructure. With cyber threats rising and compliance mandates tightening, this space is only going to grow.

Why PE loves cybersecurity:

• High renewal rates. Security tools are mission-critical and rarely churn.
• Sticky integrations. Deep embedding in customer systems means strong lock-in.
• M&A potential. Many smaller security vendors can be consolidated into platform plays.

Founders in the cybersecurity space — here’s your move:

• Sharpen your GTM (go-to-market). PE loves clear ICP (ideal customer profile) and repeatable sales motion.
• Double down on partnerships. Tech alliances with cloud providers or MSSPs raise your profile.
• Highlight compliance strengths. If your product helps with SOC2, HIPAA, or GDPR — call that out.

This sector will continue to attract capital, and being PE-ready means having the metrics and positioning that buyers care about most.

15. The average hold time for PE-owned tech companies is 4.6 years

Patience with a plan

Unlike venture capital, which often aims for a quick exit or explosive growth, private equity plays a longer, more methodical game. On average, PE firms hold onto their tech portfolio companies for about 4.6 years.

During that time, they work to boost profitability, improve operations, and often bolt on additional companies. This window gives founders, executives, and employees time to adjust and grow under new ownership.

What happens during this hold period?

• Cost optimization. PE firms often bring in operational experts to improve margins.
• Talent upgrades. Leadership teams may change or be strengthened.
• M&A activity. Add-ons and strategic tuck-ins are common.

If you’re joining a PE-owned tech company:

• Expect accountability. PE firms track metrics and expect results — fast.
• Look for growth projects. These firms usually invest in top-line growth alongside efficiency.
• Understand the exit plan. Whether it’s a future IPO or sale, you’ll be part of that roadmap.

Knowing the average hold time gives you a sense of the rhythm: it’s not a sprint, but it’s certainly not a 10-year marathon either.

16. Tech was the top sector for PE deal volume for the fourth consecutive year in 2023

Tech takes the lead

For four years running, technology has ranked as the number one sector for private equity deal volume. That’s not a coincidence. It’s a clear signal of long-term conviction. Even during economic uncertainty, tech continues to attract the lion’s share of attention and capital.

This shows that private equity has transitioned from testing the waters in tech to making it a central part of their investment strategy.

What does this tell us?

• Tech is now viewed as essential. In a world where every business is becoming a digital business, tech companies aren’t just vendors — they’re infrastructure.
• PE firms have evolved. They now have tech-specific teams, dedicated funds, and repeatable playbooks.
• Founders have more options. You’re no longer limited to IPO or strategic sale. A PE deal can often be faster and more tailored to your goals.

Founders and operators: how to respond

• Position your company as a value enabler. Show how your product supports efficiency, compliance, or revenue growth.
• Focus on metrics that PE cares about. ARR, NRR, CAC payback, and EBITDA — these are the golden KPIs.
• Tell a scalability story. PE buyers want to see a clear path to doubling or tripling revenue in 3–5 years.

If you’re building in tech today, you’re in the right sector at the right time.

17. Buy-and-build strategies drove 65% of PE tech deal activity in 2023

One deal is never enough

Private equity isn’t just buying companies — they’re building platforms. In 2023, 65% of PE tech deals followed a buy-and-build model. That means firms didn’t stop at one acquisition. They started with a core platform and added bolt-on companies to expand capabilities, markets, or customer segments.

This strategy is highly effective in tech, where combining multiple tools can create a more comprehensive solution for users.

What makes buy-and-build so effective?

• Faster revenue growth. Acquiring new customers is easier through acquisitions.
• Cross-sell potential. Add-on products can be sold to the existing customer base.
• Higher exit value. A larger, integrated platform commands better multiples.

How to make your company attractive in this context:

• Highlight your integration capabilities. Can your product plug into others easily? That’s a big plus.
• Clarify your niche. Being the best in a narrow space makes you a stronger bolt-on or platform.
• Document your operations. PE firms love clean, well-documented systems they can plug others into.

If you’re not a platform, you might be a great bolt-on. Either way, understanding buy-and-build gives you more strategic leverage.

18. Private equity firms executed over 400 tech carve-outs from public companies in 2022–2023

Carve-outs: the under-the-radar opportunity

Over 400 carve-outs happened in just two years — that’s when PE firms acquire a business unit or division from a larger public company. It’s one of the smartest plays in the private equity toolkit.

Public companies often have strong but underperforming tech divisions that don’t get enough attention. PE firms spot these opportunities, buy the division, give it focus, and turn it into a standalone success.

Why carve-outs work:

• Focus unlocks growth. A division that was buried under layers of corporate bureaucracy now gets leadership and investment.
• Undervalued assets. Public markets often overlook the value of smaller business units.
• Clean exits. Sellers (public firms) are motivated, and deals can be structured favorably.

What does this mean for you?

• If you’re part of a large tech org: Your division might be a carve-out candidate. Be ready for new ownership and a startup-like environment.
• If you run a PE firm: Carve-outs are goldmines — if you can execute well.
• If you’re a founder: Don’t be afraid to think creatively. Partnering with a PE firm to acquire a carve-out can be a shortcut to growth.

Carve-outs are about unlocking hidden value — and the pace is only increasing.

19. PE-backed firms made up 55% of total cloud tech M&A deals in 2023

Owning the cloud

In 2023, more than half of all cloud tech M&A deals involved a private equity buyer. That includes everything from infrastructure providers to SaaS platforms built on AWS, Azure, or GCP.

The shift to cloud isn’t new, but the scale of PE involvement in this space is. It signals that cloud-native businesses are no longer just “future bets” — they’re core parts of today’s enterprise infrastructure.

Why cloud companies are PE favorites:

• Subscription revenue. Predictable income streams make modeling easier.
• Scalable infrastructure. Cloud-native products scale with usage, not headcount.
• Global reach. Most cloud tools are built to serve international markets from day one.

What cloud companies should focus on:

• Highlight uptime and reliability. PE firms want infrastructure that works — no drama.
• Show usage-based growth. Growing revenue through increased usage (not just new sales) is a plus.
• Double down on customer retention. If you’ve got sticky usage and low churn, flaunt it.

The cloud is no longer a niche. It’s the new normal — and PE knows it.

20. The number of mega-deals ($10B+) led by PE in tech reached 10 in 2022, an all-time high

Private equity is swinging big

Once upon a time, $10 billion+ tech deals were the domain of giants like Microsoft, Google, or Amazon. But in 2022, private equity firms led 10 such mega-deals — the highest ever. This is not just about capital. It’s about ambition, structure, and confidence.

PE firms are no longer limited to middle-market plays. With syndicated funding, co-investors, and consortium deals, they’re going after the biggest fish in the pond.

Why are mega-deals increasing?

• Mature targets. More late-stage tech firms are ripe for transformation.
• Collaborative funding. PE firms now partner with sovereign wealth, pensions, and family offices.
• Exit confidence. These firms believe they can sell for even more — either through IPO or secondary sale.

How should founders think about this?

• Mega-deals create ecosystems. If you’re a smaller player in the same space, you might become an acquisition target.
• Big exits shift valuations. A massive deal sets new benchmarks for everyone.
• PE is now a tier-one acquirer. Don’t assume only strategics or public markets can get you to that $1B+ exit.

Mega-deals show that private equity is playing to win — and they’re not afraid to write big checks when the upside is clear.

21. In 2021, PE accounted for 50% of global tech leveraged buyouts

The buyout balance tips

Leveraged buyouts (LBOs) used to be dominated by traditional sectors like manufacturing or consumer goods. But in 2021, tech reached a major milestone: private equity accounted for 50% of all global tech LBOs. That’s half of the entire market — and a signal that tech is no longer a niche for these firms. It’s mainstream.

What makes tech ripe for LBOs?

• Stable cash flow. Recurring revenue models like SaaS make debt-funded acquisitions less risky.
• High gross margins. This leaves room to service debt and still fund growth.
• Operational levers. PE firms can optimize tech firms through pricing models, upselling, or operational scale.

What should you watch for as a founder?

• Your debt readiness. Could your business handle some debt? If so, you’re a better fit for a PE buyer.
• Resilience matters. A company that can endure market shifts with low churn and predictable billing is LBO-ready.
• Don’t fear the “B” word. Leveraged buyouts aren’t hostile. Many founders stay on post-buyout with partial ownership and capital for scaling.

Understanding the role of leverage in modern PE strategy helps you prepare for the structures they bring to the table.

22. PE firms acquired more than 80 VC-backed tech startups in 2023

From venture to value

In 2023, over 80 VC-backed startups were acquired by private equity firms. This trend challenges the assumption that PE only plays with mature companies. They’re now targeting growth-stage startups that may not be IPO-ready or want alternative exit routes.

And it makes sense. Many late-stage startups are strong in revenue but need operational support, cost controls, or a strategic reset — all areas where PE excels.

What does this mean for founders with VC capital?

• PE is now a real exit path. You’re not stuck waiting for a public market window.
• Partial exits are possible. Many PE deals let you cash out partially and keep skin in the game.
• VC funds are onboard. LPs need liquidity, and PE acquisitions provide that even when IPOs stall.

How to make your VC-backed startup attractive to PE:

• Show path to profitability. If not now, then soon. That’s a big PE requirement.
• Build systems, not just speed. PE looks for repeatability, not just top-line growth.
• Map your competitive moat. If you own a slice of your niche, that’s valuable, even at smaller scale.

Private equity is now a bridge between venture capital and public markets — and sometimes, the destination itself.

23. 70% of PE tech acquisitions in 2023 focused on recurring revenue models

Predictability wins

Recurring revenue has become the holy grail for PE investors. In 2023, 70% of all tech deals they closed involved companies with some form of recurring revenue — mostly subscription-based or usage-based models.

This is more than a trend. It’s a shift in what buyers value most: consistency, visibility, and long-term monetization.

Why recurring revenue dominates:

• Easy to model. Investors can forecast future earnings with confidence.
• Lower churn = higher value. Stickier customers justify higher multiples.
• Smooth cash flow. No more feast-or-famine cycles from one-off sales.

If you’re not fully recurring, how can you adapt?

• Introduce hybrid models. Add a maintenance plan, licensing, or retainer layer.
• Offer annual contracts. They reduce churn and boost cash stability.
• Track monthly metrics. MRR (monthly recurring revenue) and churn rates must be rock solid.

You don’t need to become a full SaaS business — but adding predictability to your revenue model can significantly boost your exit value.

24. In 2022, 90% of private equity tech deals involved minority stakes or strategic growth funding

Not just control — collaboration

There’s a common myth that PE always wants full control. But in 2022, a whopping 90% of PE tech deals were structured as minority investments or growth equity. That means these firms weren’t taking over — they were partnering.

This opens the door for founders who want funding, support, and a strategic partner without giving up the reins.

Why minority deals are rising:

• Founders stay motivated. Keeping leadership in place preserves culture and momentum.
• Flexible capital. PE firms can fund growth, not just exits.
• Faster deals. Minority deals often require less diligence and governance changes.

How can you make the most of this?

• Know your ask. Are you raising to scale, enter new markets, or roll up others? Be specific.
• Align on values. A minority investor should complement your leadership style, not clash with it.
• Negotiate governance. Define clearly what decisions need consent and which remain founder-led.

Growth equity is one of the fastest-growing segments of private equity — and one of the most founder-friendly.

25. Asia-Pacific PE tech deals grew 24% in 2023, led by software and AI investments

The East heats up

Private equity is going global — and in 2023, the Asia-Pacific region saw 24% growth in tech deal activity. Much of that was led by interest in software platforms and artificial intelligence companies.

With maturing startup ecosystems in India, Southeast Asia, and even Australia, PE firms are finding new frontiers for value creation.

Why APAC is drawing attention:

• Massive user bases. Products in Asia often scale fast and cheap.
• Favorable demographics. Growing middle classes drive digital adoption.
• Tech localization. Regional SaaS tools are thriving in non-English markets.

How Asian founders can benefit:

• Build for enterprise. B2B SaaS is heating up, especially in fintech, logistics, and HR.
• Structure globally. Singapore or Dubai holding companies make deals smoother.
• Understand investor needs. PE firms want governance, compliance, and metrics — not just user growth.

If you’re building in or expanding to APAC, now is a prime time to engage with global PE investors who are actively deploying capital in the region.

26. PE interest in SaaS companies surged, accounting for 58% of all PE tech investments in 2022

SaaS: Still the golden child

In 2022, over half of all private equity tech investments were focused on SaaS businesses. That’s 58% of deal activity — an overwhelming preference. Why? Because SaaS delivers the combination PE firms crave: steady revenue, high margins, and built-in customer retention.

What’s changed in recent years is how PE views SaaS. It’s no longer just about product or market fit — it’s about profitability, growth levers, and scale.

Why SaaS continues to dominate:

• Low churn = long tail revenue. SaaS tools, once integrated, are hard to rip out.
• Usage grows over time. Seat expansion and feature upgrades drive upsell.
• B2B focus. Most SaaS is sold to businesses, which are more stable customers than consumers.

If you’re a SaaS founder, here’s what to prioritize:

• Land and expand. Show how existing accounts are increasing their spend year after year.
• Revenue efficiency. PE firms love metrics like CAC payback and LTV/CAC ratio — keep them strong.
• Team scalability. Prove that your team, culture, and systems can support double or triple the ARR with minimal friction.

SaaS may feel crowded, but private equity is only just getting started in this space.

27. PE firms participated in three out of the top five tech M&A deals in 2023

Big moves, big influence

It’s not just the volume of deals that matters — it’s who’s showing up at the top. In 2023, private equity firms were involved in three of the five biggest tech M&A deals globally. This marks a clear shift from “PE as outsider” to “PE as leader.”

We’re talking multi-billion-dollar transactions involving household names, mission-critical infrastructure, or high-growth platforms. PE firms are now comfortable at the top of the cap table — and everyone else is taking notice.

What’s driving this trend?

• Confidence in value creation. PE firms believe they can outperform even large strategics in managing complex tech businesses.
• Sophisticated partnerships. Many mega-deals include co-investors or club deals across multiple PE firms.
• Tech as a safe bet. Even in turbulent markets, tech assets remain appealing for long-term returns.

What this means for operators and execs:

• PE can be your next boss. Large firms and even public companies may be acquired by private equity — it’s no longer rare.
• Expect aggressive timelines. PE-led integrations, growth plans, and turnarounds move fast.
• See the bigger picture. If you’re in a growing company, these mega-deals can lead to new opportunities, funding, or spinouts.

Private equity has officially earned a seat at the big boys’ table in tech M&A.

28. Tech-focused PE fundraising increased 2.5x from 2016 to 2023

More funds, more firepower

Between 2016 and 2023, fundraising for tech-dedicated private equity vehicles increased by 2.5 times. That means more capital is being raised specifically to acquire and grow technology businesses — not as part of a general fund, but as the core thesis.

This specialization matters. It brings deeper expertise, faster diligence, and better portfolio support for the companies being acquired.

Why tech-focused funds are growing:

• Investor confidence. Limited partners (LPs) want exposure to tech, but through safer, PE-style strategies.
• Operational leverage. Tech companies can scale quickly post-buyout, especially with capital and support.
• Repeatable success. More PE firms have proven tech exits, which builds momentum for future funds.

What founders can expect:

• More knowledgeable buyers. You won’t have to explain what churn or product-market fit is — these firms already get it.
• Faster deal cycles. With pre-built playbooks, tech-focused PE firms move quickly when they see a good fit.
• Hands-on support. Many firms now offer CTO advisors, sales optimization teams, and M&A leads.

The growth in specialized fundraising signals a long-term commitment — not a passing interest — from PE in the tech world.

29. Digital transformation and automation tech made up 40% of PE tech acquisitions in 2023

PE is buying the future of work

In 2023, 40% of private equity acquisitions in the tech space were in digital transformation or automation. That includes tools for robotic process automation (RPA), low-code development, workflow digitization, and AI-powered business processes.

These tools aren’t just nice-to-haves anymore. In a tight labor market and a hybrid work world, companies need automation to scale — and PE firms are betting big on that need.

Why this matters:

• B2B demand is strong. Every large enterprise is under pressure to digitize.
• Recurring models are baked in. Most automation tools are SaaS or usage-based.
• High ROI for buyers. Automation delivers measurable impact, making the tech easier to sell and expand.

How to position your company:

• Quantify the value. Show how your product reduces cost, saves time, or speeds up workflows.
• Emphasize integrations. Automation tools that plug into CRMs, ERPs, or cloud systems are more attractive.
• Build for scale. PE firms want tools that can serve large customers or be bundled into larger platforms.

Digital transformation is no longer a buzzword — it’s a PE-backed roadmap to value creation.

30. PE firms now outbid strategic buyers in 50% of competitive tech deals

The tables have turned

Traditionally, strategic buyers — large tech companies — had the upper hand in M&A. They could offer synergies, higher valuations, and attractive equity deals. But that’s changing. In half of all competitive tech deal processes, PE firms are now winning.

Why? Because they’ve learned how to compete aggressively. They bring speed, flexibility, and increasingly, just as much capital.

What gives PE the edge?

• Faster decisions. No need to run things past five departments.
• Custom deal terms. PE firms can structure earnouts, retention, or rollovers creatively.
• Aggressive post-acquisition plans. They believe in their ability to scale and improve the business.

What should sellers do?

• Run a competitive process. Don’t assume a strategic buyer will pay more.
• Evaluate all aspects of the offer. Culture, timeline, and post-deal roles matter too.
• Understand your leverage. If your company has great fundamentals, you can command better terms — no matter who the buyer is.

Private equity isn’t just keeping up with the big strategics — they’re beating them. And for sellers, that means more options, stronger terms, and faster exits.

Conclusion

The rise of private equity in tech acquisitions isn’t a trend — it’s the new norm. Whether you’re a founder, operator, or investor, the data tells a clear story: PE is here to stay, and it’s transforming how technology companies are bought, scaled, and sold.