The value of global private equity exits—including IPOs, secondary buyouts, trade sales and bankruptcies— reached a five-year low of $392.48 billion in 2024, Preqin data shows.

Trade sales, including sales to management, accounted for around half of this total, at $193.6 billion across 1,177 transactions. Secondary buyouts represented 38% of deal value, IPOs accounted for 12% and bankruptcies made up over 2%.

Exit volume increased by over 5%, reaching 2,227 in 2024, up from 2,108 in 2023. This roughly aligns with annual totals across the past five years excluding 2021, when the number of deals exceeded 3,000.

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Longer holding period

Due to the weak exit market, the average holding period for private equity firms was 6.1 years in 2024, Preqin data shows. This compares with 6.2 years in 2023, but remains higher than the average holding period recorded between 2018 and 2022.

A mismatch in valuation expectations between buyers and sellers was a key factor in the slow pace of exits.

"That gap was quite substantial this year due to various macroeconomics and political uncertainties affecting perceptions of value," Alex Di Santo, head of private equity, Europe, at Gen II Fund Services LLC, told Market Intelligence, "ultimately, that gap is starting to narrow."

It is common for the buy and sell side to intend to conclude a deal, which in the end doesn't happen, Jonas Fagerlund, partner and head, global private equity practice at consultancy Arthur D. Little, told Market Intelligence.

"Eventually, when you look at the final bids, the final bids have not reached the expectations of the sellers," Fagerlund said.

Highest number of exits

Insight Venture Management LLC and venture capital firm Y Combinator led firms in the number of exits between Jan. 1 to Dec. 9, 2024. Each participated as a seller in 22 transactions during this period, S&P Global Market Intelligence data shows.

In December, Insight completed three trade sale exits that were announced earlier in 2024: the sale of Run:Ai Labs Ltd. to NVIDIA Corp.; Mastercard Inc.'s $2.7 billion purchase of Recorded Future Inc. and Visa Inc.'s buyout of Featurespace Ltd.

Ready to rebound

Exits are expected to rebound in 2025, a positive outlook that is supported by Preqin data which indicates that exit transaction values steadily increased each quarter throughout 2024.

Pent-up demand for exits is one driver of transactions, Fagerlund said. "Both sellers and buyers need to make more deals because they haven't done too many things over the last two years. Secondly, if you look at the amount of dry powder we have with the PE firms, that's a huge amount of money waiting to be spent."

Transactions should also benefit from lower interest rates and a more predictable trajectory than in recent years. Sectors such as artificial intelligence, military technology and semiconductors, are attracting significant investor interest, Fagerlund said.

The biotechnology sector is also geared for transactions, added OrbiMed Advisors LLC Managing Partner Carter Neild. Healthcare-focused OrbiMed was among the private equity firms with the highest number of exits in 2024.

"After three difficult years for biotechnology public equity markets, we expect 2025 will see strong market performance fueled by lower interest rates, a pro-innovation FDA accelerating new drug approvals and exciting biotechnology innovation," Neild wrote in an emailed response to Market Intelligence.