Q4’25 M&A Market Update: What we’re seeing now

With Q4 complete, founders are looking for clarity on market conditions heading into the new year. Activity levels vary across firms, but capital remains available and buyers are still engaged. In this Q4 2025 market update, Kirk shares what he’s seeing firsthand across active deals, buyer behavior, and sector demand. He also outlines what private equity firms are prioritizing and where founders should be cautious. Watch the video below for a grounded view of the current market.

As 2025 comes to a close, the M&A market remains active, selective, and heavily influenced by private equity. If you are a founder thinking about a sale, it is important to understand that private equity firms now control a large share of available capital and, in many cases, can outbid strategic buyers on price. Even if your preferred exit is to a strategic acquirer, involving private equity often creates the competitive tension needed to improve valuation and terms.

Most financial buyers are pursuing similar deal profiles. They are looking for businesses with recurring or reoccurring revenue, low customer and supplier concentration, limited cyclicality, minimal capital expenditure requirements, and operations that can run without heavy founder dependence. Profitability still matters, but buyers place a premium on consistency and predictability rather than short-term growth spikes.

Buyer expectations around scale have also shifted. Many lower middle-market private equity firms now target companies generating roughly $3–5 million in EBITDA. Businesses below that range can still transact, but are more likely to attract search funds, independent sponsors, or be positioned as add-on acquisitions rather than platform deals.

Preparation has become increasingly important. CPA-prepared financials are now expected by most buyers, including independent sponsors and family offices. Entering a sale process without professionalized financials often leads to slower diligence, increased scrutiny, and reduced leverage. Reducing customer or supplier concentration before going to market can materially improve outcomes.

Certain sectors continue to attract strong interest, including professional services, field services, property management, and select healthcare services. Debt capital remains widely available, SBA financing is still active at the lower end of the market, and regulatory headwinds remain limited for transactions below $500 million.

For well-prepared companies, deal timelines remain relatively consistent, typically ranging from four to nine months. In competitive situations, sellers may be able to push for tighter diligence periods, improved economics, and stronger post-close terms. While buyers are selective, there is still meaningful demand for high-quality businesses entering the market as 2025 concludes.