EXECUTION

2025 Year-in-Review

2025: A Year of Hesitation, Not Inactivity

Deal activity in 2025 wasn’t defined by how many transactions closed—it was defined by how many didn’t happen at all. Capital was available, but uncertainty made it harder for buyers and sellers to commit. Tariffs, inflation, inconsistent buyer interest, and the rapid rise of AI changed how deals were evaluated and whether they moved forward.

For owners of smaller, privately-held companies, the last two years have been especially tough. Private sellers often have choices that are both a luxury and a burden: they don’t have to sell, so many potential deals never came to market as sellers chose to wait for clearer market conditions.

M&A activity did start picking up late in the year, driven initially by larger public transactions. History shows this momentum eventually trickles down to mid-sized private companies. By Q4, data suggested the market was turning, raising an important question for owners: what’s changed, and what does it mean for you?

Markets Are Adapting

Volatility hasn’t disappeared, but markets are learning to work through it. Strategic buyers and sponsors are re-entering the market, especially in industries less affected by tariffs, low-end consumer pressure, or AI disruption. In this environment, execution matters more than ever. Deals that close are well-prepared, realistically positioned, and able to move decisively when windows open.

Don't Wait for Perfect Conditions

The clearest lesson from 2025: waiting for certainty is not a strategy. Many sellers delayed preparation, hoping for an ideal market that never came. The companies that succeeded stayed prepared with clean financials, organized due diligence materials, and a clear positioning around growth and risk.

What This Means for 2026

If you’re considering a transaction in the next six months to two years, start preparing now. Being 80–90% ready reduces risk and gives you control over timing. That means building your managerial bench, keeping financials current, addressing customer or supplier concentration, ensuring contracts are in order, and pressure-testing your story before going to market.

At CriticalPoint, we help clients navigate complexity and execute with precision. In a market where preparation matters more than prediction, we’re here to help you take control of your outcomes.

Special Situations

2025: Kicking the Can Down the Road
In 2025, most distressed companies didn’t fix their problems, they merely delayed them. The market postponed tough decisions rather than addressing root causes, often destroying long-term equity value in the process.