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As a $5 Trillion Generational Handoff Begins, Buyers Can Afford to Be Picky. Here’s What They’ll Pay More For.

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As a $5 Trillion Generational Handoff Begins, Buyers Can Afford to Be Picky. Here’s What They’ll Pay More For.

As $5 trillion in businesses change hands across generations, owners who build a visible, transferable culture can reduce buyer risk, command a premium, and position their companies to thrive beyond the founder.

Over the next decade, up to $5 trillion in U.S. businesses is expected to change hands.

Most of that value sits with baby boomer owners aging out of companies they spent decades building, ready or not. On the buying side, private equity firms are sitting on about $1.2 trillion in uninvested buyout capital, nearly a quarter of it held for four years or more and now under real pressure to be deployed. In early August, I met with a firm backed by sovereign wealth that manages more than $30 billion in assets. It’s one piece of a global network of sovereign funds that together control roughly $15 trillion. Many of these funds have direct investment goals, including acquiring private companies in targeted sectors.

Market headlines are calling this ownership change a wave, a cycle, even a tsunami. AI-related investments dominate the news, but there’s considerable interest in industrials, infrastructure and “old-school” brick-and-mortar businesses too.

Entrepreneurs often ask the wrong questions. They ask how to time the market or how to land the best multiple, meaning the price a buyer will pay relative to the company’s earnings. Those questions matter. But I’ve been involved in more than 38 mergers and acquisitions across four continents. I’ve bought companies, sold companies and advised on deals from nearly every other seat at the table.


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