For this exclusive report, we surveyed 100 GPs and LPs based in the US and Europe on how they are responding to the challenges middle market firms face, exploring what the future may hold for dealmaking, fundraising and GP/LP alignment in the next 24 months.

Key findings:

• US middle market M&A deal value climbed for the second year in a row in 2025, up 14.7% year on year to $421.1 billion. Value for Q1 2026 was $104.1 billion, an increase of 9.4% on the same period in 2025.
• European value, by contrast, dropped marginally in 2025, down 4% year on year to $286.77 billion, but remained above pre-pandemic levels. Value for Q1 2026 was $58.8 billion, a fall of 15% on the same period in 2025.
• 87% of respondents expect the total value of US middle market buyout activity to rise over the next two years, including 36% that are predicting a significant increase.
• 79% of respondents believe that AI will be one of the top three drivers of technology investment over the next three years.
• 72% of LPs expect to increase allocations to the US middle market during the next two years. Only
• 48% say the same about large and mega GP funds.
• 66% of respondents expect geopolitical uncertainty to be one of the top challenges for GPs looking to secure deals in the middle market in the next two years.
• 60% of LPs expect the US middle market fundraising environment to become easier for GPs over the next two years compared to the previous two.
• 72% of LPs believe DPI demands are one of the most difficult issues GP have to tackle when agreeing on terms with LPs.

Taking the middle ground: US & European Middle Market Investment 2026 is also available to download from winstontaylor.com