2023 Recap: The Top Stories of the Year

The top Middle Market Growth stories of 2023 were a sign of the times. Tough economic headwinds forced investors to, at times, rethink their deal sourcing strategies based on factors ranging from regulation to the cost of capital. They also drove acquirers to explore new ways to create value within their portfolio companies, or reconsider alternatives to portco exits amid tepid buyer demand. Review the top five articles from the year below.

5. Without SAFE Banking Act’s Passage, What’s Next for Cannabis M&A?

Earlier this year, Congress failed to pass the long-anticipated SAFE Banking Act, dissipating hopes among cannabis companies and investors for a much-needed push for growth in the challenging sector. Burns & Levinson partner and co-chair of the Cannabis Business & Law Advisory group, Scott Moskol, spoke with Middle Market Growth about what the current regulatory environment might mean for cannabis M&A. Read more.

Written by Carolyn Vallejo

4. Private Credit’s Rise Continues—But Not Because of SVB

The demise of Silicon Valley Bank sent shockwaves through the commercial lending market, and occurred at a time when private credit began coming into the spotlight for M&A dealmakers in the middle market. Yet experts say SVB’s collapse was not necessarily the catalyst for private credit’s rise. Rather, experts say a flurry of factors have created an opportune environment for direct lenders to step in and finance deals. Read more.

Written by Hilary Collins

3. When Hiring a CFO, PE Firms Refuse to Settle

Having a finance chief at the help is now paramount to driving value at any business. Private equity sponsors today are increasingly focusing on this finance role—both within their portfolio companies, and within themselves. Yet experts say there is no one-size-fits-all approach to finding the right CFO. Rather, these finance chiefs need a strategic vision that aligns with the company’s overall mission. Read more.

Written by Carolyn Vallejo

2. Private Equity Leans Into the Flexibility of ESOPs

After decades of being overlooked, employee stock ownership plans, or ESOPs, came into the spotlight this year. The structure extends corporate ownership to a company’s employees, which some experts say can help retain talent and productivity while providing attractive tax incentives to a business. Middle Market Growth takes a look at the ESOP in action, with Verit Advisors founder and CEO Mary Josephs sharing her expertise into the ESOP evolution. Read more.

Written by Carolyn Vallejo

1. In It for the Long Haul: Continuation Funds on the Rise

In 2023, high interest rates and uncertainty did not make for a welcome exit environment, to stay the least. As a result, some private equity GPs have turned to continuation funds, allowing them to release investors from their commitments without forcing a private equity firm to sell. In our top story of the year, Middle Market Growth explores how and why this investment structure is gaining momentum. Read more.

Written by Karen Schwartz

Middle Market Growth is produced by the Association for Corporate Growth. To learn more about the organization and how to become a member, visit www.acg.org.