AGC's Tech PE Rankings For 2025

2025 was marked by the enthusiastic embrace of anything AI and the weakening of growth across the software industry. While the latter is not a 100% byproduct of the former, the threat of what AI could be in the future has confused, delayed, or outright killed hundreds of would-be software investments and acquisitions. Software revenue growth fell from a 40-year average of 27% to 11% for 2025. This massive deceleration has blown revenue, profits, and valuation targets across the kingdom's 60,000 software companies. This underperformance has pressurized core selling metrics such as GRR, NRR, growth, and EBITDA margins such that portcos 4+ years in their portfolio are pushing out their go to market timing further into the future. The software slowdown is creating dead money across the tech PE landscape – Dry Powder that can't be deployed fast enough & AUM that can't find liquidity.

40 years of hypergrowth has resulted in an industry much bigger, far more penetrated, and slower growing from here. PE entry valuations were predicated on better growth, performance, and higher exit valuations – all of which have underperformed across the board and are pushing out exits. Who is going to underwrite a new platform with 10% growth and high EBITDA margins against the AI Risk and an 8-year time horizon with a lower exit multiple than entry. As Dry Powder hits an all-time high, it is harder than ever to find that fast-growing, quality company. When you do find it, everyone else is also at the party with more money than ever before and pushing valuations to the stratosphere for quality assets.

The proof is in the year-end 2025 PE results. The top 250 Tech PE Funds control 5,604 software companies but were only able to exit 215 in 2025. New platform investments fell to 365 while Dry Powder rose to $444B and AUM hit $3T. 200 of the 250 funds announced one or no exits in the year. It was a very difficult year to get liquidity.

TA and Hg hold a firm grip on the top of the leaderboard with robust deal activity in both platform and add-on acquisitions. Main, Thoma Bravo, and AKKR had a strong showing with over 40 deals each. PSG led the pack in pursuit of liquidity with 13 exits, returning meaningful dollars to LPs. With few exits and robust fundraising, Dry Powder hit record levels. Surprisingly, tech PEs raised $174B from 53 funds but the number of new funds dropped to a 13 year low. The table is set for strong deal activity in the coming years with the abundance of great companies in the top 250 portfolios.

AGC Partners' deep subsector knowledge, highly active live deal experience, and strong PE and strategic relationships empower our Partners to be exceptional advisors for CEOs trying to chart a course through these challenging waters. Whether the technology is AI, Cyber, GRC, or one of 50 verticals, the AGC advisory team is deep in knowledge and relationships, ready to go 24/7, and able to power through those bumps in the road to bring about great outcomes.

AGC grinded it out in 2025, scaling up our research, origination, and banking teams across London, NYC, and Boston, adding 26 new hires. We closed 28 deals, 14 PE platforms and 14 strategic acquisitions, while signing up 40 new mandates. 40% of AGC's revenues included international engagements and our younger Partners drove over half of those new transactions. Spirits and revenues are up as we power into 2026, hopeful for the long-awaited deal market to wake up.

Merry Christmas and Happy Holidays from AGC Partners.

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