Search funds gain appeal as US private equity fundraising slows

• U.S. private equity investors closed 348 new funds through Q3 2026, putting annual fund formation on track for its lowest level since 2016.
• Commitments totaled $222 billion, on pace for the lowest annual fundraising total since 2020.
• Funds larger than $1 billion attracted more than 85% of commitments, squeezing smaller managers as investors favored established firms.
• Average portfolio holding periods reached a record 4.2 years; nearly $1 trillion remained unspent at the end of 2025.
• Smaller managers are increasingly turning to single-acquisition search funds, targeting high-net-worth individuals and family offices as traditional fundraising becomes harder.

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