It's hard to predict M&A quarter-to-quarter, but the fundamental drivers for capital investment and strategic repositioning post-COVID remain strong. I think in multi-year cycles and remain relatively optimistic about 2026.

Uses 2025 as an example where optimism was high, then tariffs caused concern, but the second half became one of the most active periods.

2026 is a tale of two cities: deals over $5 billion are the most active in history, exceeding 2021, but private equity and the smallest transactions are down materially.

Private equity is typically 35-40% of the M&A market but is running at about 24%.

For private equity monetization, it's less about rates and more about when valuations become attractive. They've used continuation vehicles to extend duration.

There's pressure to return capital to investors the longer it goes, but valuations in some sectors are doing well. Capital has rotated into 'steel in the ground' industries less exposed to AI, like food and core demand businesses.

Software is a very big universe. There's still new company formation. The impact of AI on valuation is to be seen, but it's clearly having an impact.

Draws parallel to the internet era where many winners started years later.

AI is the first impactful situation where there isn't a history of experts in boardrooms. Boards and management teams are grappling with how to get expertise for business planning, M&A, and investment.

Contrasts with COVID, which had health experts, and the financial crisis, which had former CFOs.

There is an incredible amount of capital looking to invest. The vehicles (syndicated loans, private credit) may ebb and flow, but capital will find a way to reach opportunities.

Foundational belief that intrinsic capital demand for investment won't change.