Q3 2026 Lincoln Private Market Index™

The LPMI increased 2.8% in Q3 2026, while the S&P 500 enterprise values similarly increased 3.8% during the quarter; however, when excluding the “Magnificent Seven” from the S&P 500, which are less comparable to private market companies, the enterprise value of public companies conversely decreased 2.8%. While both public and private markets faced similar macroeconomic pressures, including inflation and elevated borrowing costs, differences in enterprise value performance largely reflect the composition of their respective constituents. The greater diversification of the private markets has enabled companies to find ways to succeed without reliance on the AI trade of the public markets.

“Q3 continued the LPMI’s historical pattern of enterprise value growth being driven primarily by company fundamentals rather than changes in multiples,” noted Steve Kaplan, Neubauer Distinguished Service Professor of Entrepreneurship and Finance at the University of Chicago Booth School of Business, who assists and advises Lincoln on the LPMI. “While private companies have continued to demonstrate earnings growth, the ability to sustain that performance will become increasingly important as higher borrowing costs place additional demands on cash flow.”

In Q3, enterprise values of technology companies continued to partially recover from the February 2026 software sell-off as AI-related disruption concerns softened; however, the sector still lagged all others year-to-date. The trend in enterprise values of technology companies corroborated prior expectations that the repricing reflected longer-term disruption risks rather than changes in near-term results and outlook.

“The industries under pressure change with market conditions,” noted Ron Kahn, Managing Director and Co-Head of Lincoln International’s Valuations & Opinions Group. “Coming out of the pandemic, it was a question of when, not if, gyms and similar businesses would reopen, despite lifestyle and leisure demonstrating the highest degree of stress. Today, however, the fundamental concerns about the long-term viability of software and software-adjacent businesses are causing significant concentration of stress in software and related subsectors, demonstrated by the increased percentage of loans being marked below 90% of par.”

Healthcare and business services companies led enterprise value growth in Q3, as investors shifted away from the volatile technology companies into more value-oriented sectors as constraints on cash flows persisted among inflationary pressures. Enterprise values of companies within the energy sector continued to outpace all other sectors over the past 12 months as oil prices continued to climb and electricity demand for data center and physical AI expansion persisted.

The gray line in Graph 3 indicates the quarterly change in LPMI enterprise values, which is based on changes in performance (e.g., EBITDA), combined with the change in EBITDA multiples.

Private company operating performance was resilient in Q3. Data from Lincoln Lens, Lincoln’s comprehensive client portal and private market intelligence platform from which the LPMI is derived, indicates that 72% of companies grew revenue and 64% grew EBITDA year-over-year, with revenue growth of 7% and EBITDA growth of 5%. These results were largely consistent with Q2, indicating steady earnings expansion.

Software fundamentals were also largely unchanged following the Q1 multiple-driven repricing, with year-over-year revenue growth near 7% and EBITDA growth near 5% in Q3. At the same time, broad sector stability does not imply that all software assets are one in the same but rather still distinguished between exposure to AI-driven change, operating durability, leverage and loan-to-value. Software valuations deviated by subsector, with cybersecurity and supply chain technology performing the best given their positioning relative to AI’s growth and concerns.

Similarly, new buyout valuations were steady in Q3. The average enterprise value multiple for new buyouts was 12.1x EBITDA year-to-date through Q3 2026, compared with 12.0x for the first half of 2026 and 12.7x for the comparable 2025 period, and remained above the long-term average of 11.5x.

Similar to prior quarters, all size categories tracked by the LPMI moved in alignment with negligible variability by size.

While enterprise values increased for all size cohorts, smaller companies (i.e., companies with EBITDA <$20 million) experienced a lesser increase than their larger counterparts, as larger companies have been broadly able to handle inflationary pressures and have been insulated to a greater extent from various broader market headwinds. Conversely, investor demand has risen for smaller businesses given the potential for opportunistic valuations despite the inherent greater risk for smaller businesses as market participants facing deployment pressures look down-market for platform businesses. The shift in focus continues to be driven by heightened competition and the empirical trend of add-on opportunities remaining constructive and stable while also buying down entry multiples on existing platforms.

Source of Data and Sample Size

On a quarterly basis, Lincoln determines the enterprise fair value of over 7,450 portfolio companies for over 250 sponsors (i.e., private equity groups and lenders to private equity groups). These portfolio companies report quarterly financial results to the sponsor or lender. Lincoln obtains this information and determines the appropriate enterprise value multiple so as to compute the enterprise value in accordance with the fair value measurement principles of generally accepted accounting principles. In assessing enterprise value, Lincoln relies on well accepted valuation methodologies such as the market approach and income approach considering each company’s historical and projected performance and other qualitative and quantitative factors. Finally, each valuation is then vetted by auditors, company management, boards of directors and regulators. Upon concluding each quarterly valuation cycle, Lincoln aggregates the underlying financial performance and enterprise value data for analysis.

To construct the LPMI, Lincoln selects a subsection of the companies valued each quarter, including private companies each generating earnings before interest, taxes, depreciation and amortization of less than $250.0 million, disregarding venture-stage businesses and non-operating entities, such as special purpose entities that own real estate and specialty finance assets.

For more information, visit An Overview of the Lincoln Private Market Index.

Academic Advisors

Professor Steven Kaplan is a Senior Advisor to Lincoln’s Valuations and Opinions Group. He is the Neubauer Family Distinguished Service Professor of Entrepreneurship and Finance and Kessenich E.P. Faculty Director at the Polsky Center for Entrepreneurship and Innovation at the University of Chicago Booth School of Business. Among other courses, Professor Kaplan teaches advanced Master of Business Administration and executive courses in entrepreneurial finance and private equity, corporate finance, corporate governance and wealth management. Professor Kaplan conducts research on a wide array of issues in private equity, venture capital, corporate governance, boards of directors, mergers and acquisitions and corporate finance. He has been a member of the Chicago Booth faculty since 1988.

Professor Kaplan serves on the board of Morningstar and several fund and company advisory boards. He is also a Research Associate at the National Bureau of Economic Research.

Professor Kaplan received a Bachelor of Arts, summa cum laude, in applied mathematics and economics from Harvard College and earned a Doctor of Philosophy in business economics from Harvard University.

Professor Michael Minnis is a Senior Advisor to Lincoln’s Valuations and Opinions Group. He is the Deputy Dean for Faculty and Fuji Bank and Heller Professor of Accounting at the University of Chicago Booth School of Business, where he researches the role of accounting information in allocating investment efficiently by both managers and capital providers. His recent research focuses on understanding the role of privately held companies in the U.S. economy and how these firms use financial reporting to access, deploy and manage capital. He particularly enjoys identifying unique data and methods to empirically examine issues in a novel way.

In January 2018, Professor Minnis became a member of the Private Company Council, the primary advisory council to the Financial Accounting Standards Board (FASB) on private company issues. Professor Minnis received his Ph.D. from the University of Michigan and his B.S. from the University of Illinois, where he graduated with Highest Honors.

Independent Academic Validation of Lincoln’s Data

In January 2024, an Assistant Professor of Finance at Penn State University’s Smeal College of Business conducted a study to evaluate the statistical significance of Lincoln’s private market Database as compared to other independent sources, like Pitchbook, BDC Collateral, and Preqin. The test was akin to an FDA pharmaceutical drug effectiveness test wherein Lincoln’s data was tested in relation to the independent data sets, measuring overlap of deals detailed and congruency of reported terms. The results were robust and concluded that Lincoln’s data was representative of the private debt universe, and comprehensive of sponsor backed deals, in particular. Lincoln’s Database featured 53% of reported private debt deals with terms in Pitchbook and 48% of sponsor backed deals with reported debt terms that appeared in BDC Collateral. However, beyond the abundance of pure deals, Lincoln’s database goes a step beyond and includes vital operating performance figures from the portfolio company level that the other databases don’t feature. Lincoln’s data is more comprehensive, inclusive of enterprise value and financial performance metrics that allow for a much clearer picture of the state of the private markets.

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Lincoln International’s Valuations & Opinions Group (VOG) is a leading independent valuation advisor to managers of illiquid assets and lenders to alternative assets funds. VOG specializes in the valuation of illiquid debt, equity and derivative securities. Additionally, it provides independent fairness, solvency and other transaction opinions for a variety of corporate transactions for both public and private companies.

VOG is widely recognized for leveraging Lincoln International’s “real-world” transaction experience from its mergers and acquisitions (M&A) and capital advisory practices to assist its clients in the determination of fair value. Lincoln International’s highly skilled professionals have extensive experience in determining and supporting fair value measurements for traditional and complex securities.

Important Disclosure

The Lincoln Private Market Index is an informational indicator only and does not constitute investment advice or an offer to sell or a solicitation to buy any security. It is not possible to directly invest in the Lincoln Private Market Index. Some of the statements above contain opinions based upon certain assumptions regarding the data used to create the Lincoln Private Market Index, and these opinions and assumptions may prove incorrect. Actual results could vary materially from those implied or expressed in such statements for any reason. The Lincoln Private Market Index has been created on the basis of information provided by third-party sources that are believed to be reliable, but Lincoln International has not conducted an independent verification of such information. Lincoln International makes no warranty or representation as to the accuracy or completeness of such third-party information.