A new PitchBook report shows a mixed recovery picture for private equity activity in the middle market during the first quarter of 2025.
According to the report, dealmaking posted a strong resurgence with $46.2 billion deployed in 1Q 2025, marking a significant 41.7% increase from the previous quarter. This represents the highest quarterly total since 4Q 2022, though deal volume remains 11.4% below pre-interest rate hike averages.
However, not all segments showed equal progress. While middle-market fundraising began 2024 with positive momentum, the first quarter of 2025 saw a substantial decline, with only $11.7 billion raised across 27 funds. This represents a 69.7% decrease from the previous quarter, continuing a trend of falling fundraising numbers that began in mid-2024.
The report also highlights significant recovery in middle-market exit activity, which reached $35.6 billion in 1Q 2025—a 121.4% increase from 4Q 2024. However, this figure remains 14.5% below pre-rate hike averages, suggesting continued challenges in the exit environment.
