Partner Tim Burke spoke with PE Hub to share Stride Consumer Partners’ outlook on the investment environment for the consumer sector. Here is an excerpt from the Q&A and you can read the full article here.
How do you expect the first six months of PE dealmaking in 2023 to compare with the last six months of 2022?
We anticipate it looking similar: companies will continue to navigate the uncertainty, weighing their options to decide the best path forward. That said, Stride is optimistic about the opportunities in 2023. Our team has invested together for decades and through multiple cycles. We chose categories within consumer that are highly resilient, and the companies we pursue have shown that they grow through broader macroeconomic cycles. These are the brands that consumers are passionate about and will give up last, even if they pull back on discretionary spending elsewhere. In fact, we’ve seen that macro disruption can accelerate shifts in consumer purchases away from large companies (who are spending less on marketing and product development) towards insurgent brands. Because we don’t rely on debt, we are able to be nimble when we find an attractive opportunity. Once a few of these insurgent brands raise capital at strong valuations, we believe that others will follow.