Our Managing Partner Nico Zeifang had the chance to contribute a guest article to FundResearch on a question that comes up in many of our conversations with investors: how serious is the exit backlog in private equity, and does it affect the whole market in the same way? Drawing on our own analysis of 1,657 realized exits, the article makes the case that the picture looks very different at the smaller end of the market.
“The exit backlog in private equity is often described as a problem for the entire market. In fact, it is concentrated in large buyouts. In the small-cap and lower mid-market segment, companies continue to change hands after just under five years.”
— Nico Zeifang, Managing Partner at Penguin Capital
A few of the points the article makes: In the 2020s, the median holding period of realized small-cap transactions was 4.8 years, against 7.3 years for large-cap deals. Much of today’s backlog traces back to large buyouts from 2021 and 2022, bought at entry multiples that peaked at 16.8x EBITDA — buyers of smaller companies paid little more than half of that. And the incentives differ: for large funds, management fees carry considerable weight and continuation funds offer a way to hold on, while small-cap managers rely more on carried interest and have a stronger reason to sell once the value creation phase is complete.
For investors, Nico’s conclusion is that company size belongs next to strategy and vintage among the core selection criteria — and that, at the moment, liquidity is flowing most reliably where companies still change hands on schedule.
The article was published on 29 October 2026 and is available in German.