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Iyan.vtt

English

{{00:00:07}}
Mid market managers are doing a lot of
interesting things in this environment.

{{00:00:11}}
They actually have a structural advantage
because in the middle market these

{{00:00:16}}
investors have a lot of flexibility in
terms of deal structuring, in terms of

{{00:00:20}}
leverage levels, and in terms of the path
to exit of many of these investments.

{{00:00:24}}
And so the way they're adapting is
really going back to first principles

{{00:00:28}}
to going back to underwriting
against high quality businesses.

{{00:00:34}}
That have structural advantages
that have a very loyal customers and

{{00:00:40}}
making sure that those businesses
have multiple paths to value creation

{{00:00:46}}
around talent, around operational
efficiency, around data and analytics.

{{00:00:51}}
And that's how many managers today
are really taking a lens to making

{{00:00:55}}
the most of the opportunities
that exist in today's landscape.

{{00:01:04}}
I think the key strategy that many
mid market investors and managers are

{{00:01:07}}
using today is really leaning into
the operative word is really scale.

{{00:01:13}}
That's what's driving a lot of the
industry today, which is a lot of

{{00:01:16}}
folks have to think differently about
scaling every part of their business.

{{00:01:21}}
How they fundraise, how they underwrite
investments, how they manage their

{{00:01:24}}
portfolios, how they manage their
stakeholders and their investors.

{{00:01:29}}
And they're really leaning into scale
and they're thinking about the fact

{{00:01:31}}
that the unprecedented growth we've
had in this industry has to meet the

{{00:01:36}}
demands of scale because You have to
scale in a nonlinear way with costs.

{{00:01:44}}
And so that involves really
thinking backwards to if my firm

{{00:01:48}}
was 10x its size, what would break?

{{00:01:52}}
And what would have to be true
for me to operate at that scale?

{{00:01:55}}
And they're really looking across
their organizations and finding all

{{00:02:00}}
the blockers and all the levers that
need to be loosened up and truly

{{00:02:04}}
scaled up to take advantage of the
opportunities in this environment.

{{00:02:13}}
AI is really a major unlock, but it's
not just AI alone, naturally, it's all

{{00:02:18}}
of the technology that's available today.

{{00:02:21}}
Technology costs and
technology availability.

{{00:02:23}}
Costs have obviously
come down very rapidly.

{{00:02:27}}
Availability has become widespread.

{{00:02:29}}
And so we're seeing two
things in the middle market.

{{00:02:32}}
The first is really back to basics,
which is many of the mid market

{{00:02:36}}
portfolio companies have traditional
technologies like CRM's, Use very well.

{{00:02:42}}
They have a lot of data that
hasn't been centralized and

{{00:02:45}}
cleansed and properly utilized.

{{00:02:47}}
And so there's a back to basics in
the first principles movement in which

{{00:02:51}}
folks are finding all the low hanging
fruit that hasn't been picked yet.

{{00:02:55}}
Now, as you move up the stack,
a lot of mid market portfolio

{{00:02:59}}
companies are unlocks.

{{00:03:02}}
In terms of being able to use a I to
gain more manpower and more efficiency.

{{00:03:09}}
Hiring today is very challenging.

{{00:03:12}}
Labor costs are still fairly high.

{{00:03:14}}
And what folks are finding is
that if you can scale further your

{{00:03:19}}
processes either with traditional
technologies or a I that could be a

{{00:03:23}}
significant differentiating factor on.

{{00:03:26}}
Then.

{{00:03:26}}
Secondly, there's some really
interesting companies that are

{{00:03:29}}
differentiating themselves.

{{00:03:31}}
By rethinking what
business are we really in?

{{00:03:34}}
And so it might be a medical devices
company that winds up sitting

{{00:03:39}}
on a lot of proprietary data.

{{00:03:42}}
And that data when applied with generative
AI could allow them to unlock new products

{{00:03:47}}
and new opportunities and new markets.

{{00:03:49}}
And so we're seeing that end of the
spectrum as well in terms of using AI

{{00:03:53}}
to push the boundaries of innovation and
create new value within this company.

{{00:04:03}}
There's several interesting trends there.

{{00:04:05}}
The first is the philosophy.

{{00:04:07}}
There's a trend of the philosophy
shifting of value creation starting

{{00:04:12}}
at the point of due diligence.

{{00:04:13}}
This has become one of the key things that
is emerging today where thinking about

{{00:04:18}}
value creation from the very beginning
and underwriting an investment has become

{{00:04:23}}
very prevalent and that will continue.

{{00:04:25}}
Second major trend is really a
focus on operational efficiency

{{00:04:29}}
and using technology as the
driver of operational efficiency.

{{00:04:34}}
That's a major trend as folks look at
every facet of business operations from

{{00:04:38}}
finance to HR to product innovation
and delivery is a major trend.

Mid market managers are doing a lot of
interesting things in this environment.

They actually have a structural advantage
because in the middle market these

investors have a lot of flexibility in
terms of deal structuring, in terms of

leverage levels, and in terms of the path
to exit of many of these investments.

And so the way they're adapting is
really going back to first principles

to going back to underwriting
against high quality businesses.

That have structural advantages
that have a very loyal customers and

making sure that those businesses
have multiple paths to value creation

around talent, around operational
efficiency, around data and analytics.

And that's how many managers today
are really taking a lens to making

the most of the opportunities
that exist in today's landscape.

I think the key strategy that many
mid market investors and managers are

using today is really leaning into
the operative word is really scale.

That's what's driving a lot of the
industry today, which is a lot of

folks have to think differently about
scaling every part of their business.

How they fundraise, how they underwrite
investments, how they manage their

portfolios, how they manage their
stakeholders and their investors.

And they're really leaning into scale
and they're thinking about the fact

that the unprecedented growth we've
had in this industry has to meet the

demands of scale because You have to
scale in a nonlinear way with costs.

And so that involves really
thinking backwards to if my firm

And what would have to be true
for me to operate at that scale?

And they're really looking across
their organizations and finding all

the blockers and all the levers that
need to be loosened up and truly

scaled up to take advantage of the
opportunities in this environment.

AI is really a major unlock, but it's
not just AI alone, naturally, it's all

of the technology that's available today.

Technology costs and
technology availability.

Costs have obviously
come down very rapidly.

And so we're seeing two
things in the middle market.

The first is really back to basics,
which is many of the mid market

portfolio companies have traditional
technologies like CRM's, Use very well.

They have a lot of data that
hasn't been centralized and

And so there's a back to basics in
the first principles movement in which

folks are finding all the low hanging
fruit that hasn't been picked yet.

Now, as you move up the stack,
a lot of mid market portfolio

In terms of being able to use a I to
gain more manpower and more efficiency.

And what folks are finding is
that if you can scale further your

processes either with traditional
technologies or a I that could be a

Secondly, there's some really
interesting companies that are

By rethinking what
business are we really in?

And so it might be a medical devices
company that winds up sitting

And that data when applied with generative
AI could allow them to unlock new products

And so we're seeing that end of the
spectrum as well in terms of using AI

to push the boundaries of innovation and
create new value within this company.

There's several interesting trends there.

There's a trend of the philosophy
shifting of value creation starting

This has become one of the key things that
is emerging today where thinking about

value creation from the very beginning
and underwriting an investment has become

Second major trend is really a
focus on operational efficiency

and using technology as the
driver of operational efficiency.

That's a major trend as folks look at
every facet of business operations from

finance to HR to product innovation
and delivery is a major trend.

How is technology transforming private markets? Iyan Adewuya, Senior VP & Head of Private Markets at S&P Global Market Intelligence, shares his expert insights on the evolution of data, AI, and digital solutions in the private investment landscape.

