SI Global's second annual Private Equity Insights Report indicates a significant resurgence in private equity investment within the marketing sector, noting a 21% year-on-year increase despite a prior downturn. Digital and influencer agencies have been the chief beneficiaries, absorbing 50% of total investments. The report highlights a notable shift as PE firms favor first-time acquisitions over traditional roll-up strategies. Additionally, firms are holding on to their assets longer, demonstrating a slower exit strategy with a 27% reduction in PE exits, suggesting a strategic pivot towards organic growth within newly acquired agencies.
The standout finding is a 21% year-on-year increase in investment activity by private equity (PE) firms into marketing, tech and consultancy businesses.
Digital, social and influencer agencies have received 50% of the total investment in the space over the last 12 months - a threefold increase from last year.
PE funds are holding on to their agency assets for longer than expected. PE 'exits' have been slower to materialize, down 27% since last year.
The focus is on new acquisitions, with 87% of new PE activity coming from first-time investments rather than reinvestments or bolt-ons.
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