PE Is 20 Years Behind. Now What?
Hello dear readers,
Welcome to the second edition of the new (3-2-1) format with a new name - Inside The Data Room!
It's been a busy week here at Crawford McMillan HQ between exciting conversations with new prospects and flying solo with the kiddos. My dear wife was away for the big conference event in her work's annual calendar. I hear a great time was had by all at BakingTech 2026.
AI and automation are in the news again this week. A lot of polarisation towards either "AI is totally useless!" or "AI is taking over the world." Remains to be seen where on the spectrum of the truth actually is - see what you think after my openclaw update....
Three Things I Learned This Week
PE is 20 years behind and running out of time
I hosted Lee McCabe - one of the biggest LinkedIn voices on private equity - on my PE Data Guy podcast. If you think private equity has it all figured out then listen to this episode - Lee says what every operating partner is thinking but no one says out loud. He says the PE industry is 20 years behind on digital and he has the receipts to prove it.
OpenClaw is working well but requires patience and persistence to get it there
I've finally got my OpenClaw bot running autonomously as a fully fledged research assistant. It took many configuration changes and conversations to get the output reliable and formatted the way I wanted it but it was very much worth the effort and chunk of API tokens. Here's a sample of what's waiting for me each morning.
Private Equity Conferences are a bit of a racket
As someone growing in the space, I've been scanning potential conferences where PE firms, operating partners, and PE-backed companies are in attendance. The conferences themselves are relatively expensive at around $3,000 per person but the real kicker is that as a 'purveyor of advisory services' the amount these organisations are asking for any sort of attendance (never mind a speaking slot) is outrageous, often well in excess of $20K.
As a result all of the new wave of ideas about how to create value in mid-market companies are being shut out of the conversation. Lee and I discussed this a little on the pod, maybe some ideas in the pipeline to address this imbalance. Watch this space.
Two News Stories From This Week in Mid-Market PE & Data
Buy-and-Build Is Now the Default Value Creation Play
FRP Advisory reports that 56% of their 2025 transactions involved PE, with buy-and-build intensifying as the primary lever in a modest growth environment. Sponsors aren't chasing volume. They're stacking add-ons to create multiple arbitrage and scale.
Every add-on acquisition creates a data integration problem. Two CRMs, two ERPs, two definitions of "revenue." The firms that plan for data integration from day one of the value creation plan compound returns. The ones that ignore it until exit pay for it in diligence.
Allianz Says PE Exits Are Bifurcating. Mid-Market Is Getting Left Behind.
Allianz's PE research note (published this week) shows 2025 exit activity hit $905B globally, second only to 2021. But 78% was concentrated in mega exits. Mid-market remains stagnant. LPs are shifting priorities too: 21% now prioritize DPI (distributions to paid-in) vs. 8% three years ago. The message is clear. LPs want cash back, not IRR on paper.
When exit windows are narrow and buyers are selective, the assets that trade are the ones that survive diligence cleanly. Mid-market sponsors sitting on 6+ year holds can't afford data issues adding weeks to a process that's already fighting headwinds. The bifurcation isn't just about deal size. It's about readiness.
Free Tool of the Week - Crawford McMillan PE Data Whitepaper 2026
Free research briefing on the three data problems most likely to erode portfolio value in 2026 and a practical framework for operating partners to address them. Check it out here!
If 70-90% of deals miss expectations, the question isn't whether your data is a problem. It's whether you know which problem it is.
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Cheers,
Graeme