We'll See Resumption of Deals: Blackstone's Baratta

Editor's take

Blackstone's private equity chief anticipates a resurgence in dealmaking, driven by investor demand for assets perceived as resistant to AI-driven disruption. This signals a bifurcated market where established, less digitally susceptible industries may see renewed capital inflow, while tech-adjacent sectors face continued scrutiny and potential valuation adjustments.

The implications are significant for both established corporations and venture-backed startups. Companies in sectors like healthcare infrastructure, utilities, or certain manufacturing sub-sectors, less immediately impacted by generative AI's rapid evolution, could become more attractive targets. Conversely, businesses heavily reliant on AI for core operations or competitive advantage may find their funding rounds more challenging, demanding clearer ROI and defensible moats beyond current AI capabilities.

Moving forward, the true test will be discerning which industries and business models exhibit genuine AI resilience versus those merely enjoying a temporary reprieve. Watch for specific sector valuations and deal sizes within private equity to confirm this trend. The ability of companies to articulate tangible, long-term competitive advantages that transcend the current AI wave will be paramount for attracting capital.