What’s with Private Equity?

January 26, 2026/Finance/

I guess “Private” means “Privacy” and that is probably why it is so difficult to get information on how the Private Equity market is doing. The status of the industry is, however, of much interest to those in the Death Care profession because so much money has entered Death Care through private equity in the past decade. . . . .It’s more than likely factual to say that the entrance of private equity money into Death Care has speeded up the process of consolidation.

Only a year and a half ago Funeral Director Daily published this article entitled “Why Private Equity?”. The article, on the heels of the announcement of the Park Lawn Corporation sale to a group which included private equity partner Birch Hill Equity Partners, made the point that private equity investors created a good marriage with Death Care operators.

Research that I uncovered gave one reason as to why. . . “according to this article from Mission Wealth Management, the returns in the latest 20-year period for private equity investments has been 14.9% annually vs. the returns for Global Stocks (public companies) has been only 7.9%. So, if you can afford to invest in them, “Why not invest in private equity when the return on investment is almost double?”

But, something seems to have happened in the past few years. This article titled “Why this CEO won’t let Private Funds near his company’s 401(k)” published recently in the Wall Street Journal made this claim, “. . .fundraising for private-equity, venture-capital and other non-traded funds has shriveled, and their portfolios are glutted with thousands of unsold companies. Private-equity funds held by major institutional investors trailed the S&P 500 by an average of 4 percentage points annualized over the 10 years ended June 30.” (Editor’s Note: There are a couple of good graphs in the article which portend to show “2025 Capital raised by Private Funds” and “2025 Number of Final Private-Equity closes”.)

Another article published in December 2025 titled “US Deals 2026 Outlook – Private Equity” by PWC makes notes of some headwinds for private equity going forward including a fundraising slowdown, a deployment of funds imbalance, a liquidity lag, and crowded competition for deals. You can access that article here.

Tom Anderson
Funeral Director Daily

An especially interesting headwind to me is that of “a liquidity lag”. We don’t always know the intentions of private equity companies when they become partners in businesses. But, the nature of the business is that they invest and then divest and take their profits of that investment when they have increased the value of the business.

A lag in exits, or sales, would seem to indicate that there is something not working to plan with the anticipated outcome at the time of the original deal.

And, I think it is interesting that we have not heard a lot of that type of divestment from the “deals” that were done in the Death Care space as of yet. The PWC article linked above makes this comment about this situation as it relates to private equity in general, “. . there remains a backlog of long-hold portfolio companies, and a rebound in exits will be uneven as buyers, lenders, and limited partners recalibrate expectations. “

When it comes to Death Care specifically, there is a pretty fair thought process of those in the know that some of the private equity deals done over the past five years or so have not performed as well as anticipated for the private equity funds. If that is true, it remains to be seen what will happen to those companies that had private equity infusions and are not performing as expected. It is my opinion that not growing the assets or worse yet, losing money, are not outcomes private equity will endure forever.

It will be interesting to see what the future holds and if Private Equity remains bullish on Death Care.

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