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1 big thing: Buyouts' (modest) comeback

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May 20, 2024
The column chart shows the fluctuating number of private equity fintech buyouts from Q1 2020 to Q1 2024, with a peak in 2021. Buyout activity has begun ticking upward again, hitting 16 in Q1 2024.
Data: PitchBook; Chart: Axios Visuals

Private equity buyouts of fintech companies are back on the rise, a PitchBook report shows.

Why it matters: More companies will be exited via M&A or buyouts, even if IPOs command the bigger dollar signs and headlines.

By the numbers: Private equity firms announced buyout deals with 16 U.S. or Canadian fintech companies in the first quarter of the year. That's the highest since the fourth quarter of 2021.

Zooming in: PitchBook's calculations included Frazier Healthcare Partners' acquisition of RevSpring, Accel-KKR's acquisition of Accertify from American Express, and General Atlantic's majority investment in Plusgrade.

Context: Private equity firms completed over 2,000 buyout deals last year, according to a Bain & Co. report.

  • Hampered by the volatile public markets, about 1,429 IPOs were launched globally in the same period, per S&P Global.

The big picture: This bounceback in private equity buyouts isn't a fintech-only phenomenon. PE firms are seeing greener shoots across multiple industries and finding more middle-ground in pricing negotiations.

  • Public fintech valuations have notably ticked up since last year, giving sellers a better price point compared with a year ago.
  • Known for using debt to fund deals and juice up returns, PE firms have been ponying up more cash as higher interest rates make leveraged buyouts look expensive.
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