In 2024, we predict tech will continue to be an attractive sector for PE with robust performance. Technology investments, especially in software and cloud computing, have seen historical growth and record multiples over the past few years. From enterprise software solutions to digital tools for automating employee management, and technologies to streamline supply chain operations — tech investments are outperforming other market segments.
Much as they did at the beginning of the pandemic, companies across all industries are seeking technology solutions to help them weather continued economic uncertainty. After another year of headwinds, companies see the value in upgrading their digital processes and infrastructure. Those factors, coupled with evolving trends like AI and advanced cloud solutions, make the tech industry especially resilient.
With dry powder ready to invest, technology investments may prove relatively straightforward to scale and grow. We anticipate PE firms will buy tech platform companies and acquire numerous products to increase value through add-ons. During these acquisitions, firms can leverage economies of scale to drive efficiency, increase margins and accelerate growth.
For further 2024 tech trends, read our blog here.