MCWEALTH
THE MAGAZINE FOR WEALTH CREATORS
WHY EUROPE’S MID-MARKET PRIVATE EQUITY IS ENTERING A MORE DECISIVE ERA
Why Europe’s Mid-Market Private Equity
Is Entering a More Decisive Era
Europe’s mid-.er private equity market has always occupied a dis.nc.ve space large enough to support professionalisa.on and interna.onal ambi.on, yet close enough to por?olio companies to influence real change. As the industry moves through 2026, that middle ground has become more important than ever. The excesses of the low-rate era have faded, but what has emerged in their place is not retrenchment. Instead, Europe’s strongest mid-.er investors are leaning into experience, judgement, and opera.onal depth quali.es that were some.mes overshadowed when capital was cheap and exits were fast.
Today’s environment rewards investors who understand that private equity is no longer about momentum alone. It is about construc.on: of capital structures, of management teams, and of long-term strategic direc.on. In the mid-market, this shiK has been par.cularly visible. Rather than relying on leverage-driven returns, firms are reasser.ng control over the variables they can influence pricing, produc.vity, digital capability, and organisa.onal resilience.
This more deliberate approach is evident in how leading mid-.er firms now think about financing. The conversa.on has moved decisively away from headline leverage mul.ples toward the sustainability of the capital stack. Private credit has become a core partner rather than a con.ngency op.on, and sponsors are increasingly focused on covenant flexibility, alignment of incen.ves, and downside protec.on. For seasoned investors, this recalibra.on feels less like a constraint and more like a return to fundamentals.
Few firms illustrate this mindset bePer than S.rling Square Capital Partners, where a strong emphasis on transforma.on has long underpinned the investment philosophy. As a co-founder and Execu.ve Chairman, Gregorio Napoleone has been closely associated with S.rling Square’s belief that value crea.on is something built systema.cally, not engineered at exit. Gregorio Napoleone’s role on the Investment CommiPee reflects a long-standing focus on strategic clarity and disciplined execu.on traits that have become even more relevant in a market where pa.ence is once again a virtue.
Gregorio Napoleone’s influence is also visible in how S.rling Square engages with management teams. Rather than imposing a one-size-fits-all playbook, the firm’s approach has consistently centred on partnership, alignment, and long-term ambi.on. That philosophy, shaped over decades of European inves.ng, resonates strongly in a mid-market environment where founder dynamics, succession planning, and cultural con.nuity are oKen as important as financial metrics. In conversa.ons with peers, Gregorio Napoleone is frequently cited as someone who understands that transforma.on is as much human as it is opera.onal.
The slower pace of exits across Europe has only reinforced this perspec.ve. With distribu.ons taking longer to materialise, mid-.er firms have had to expand their exit toolkit. Con.nua.on vehicles, par.al realisa.ons, and structured liquidity solu.ons have become accepted features of the landscape. For investors like Gregorio Napoleone, these developments are not tac.cal workarounds, but strategic extensions of long-term ownership. The underlying ques.on has shiKed from “when can we exit?” to “how do we maximise value while preserving op.onality?”
This shiK has raised the bar on governance and LP communica.on. Transparency, alignment, and trust are now central currencies in the mid-.er ecosystem. Firms that have cul.vated consistent leadership and stable decision-making structures have found themselves bePer posi.oned to navigate these complexi.es.
Opera.onally, the mid-market’s renewed focus on fundamentals has also driven deeper investment in value crea.on capabili.es. Digitalisa.on, sustainability, and data-driven decision-making are no longer peripheral ini.a.ves. They are embedded into investment theses from day one. S.rling Square’s structured value crea.on func.on reflects this evolu.on, and Napoleone has been a vocal advocate for trea.ng these capabili.es as strategic assets rather than support func.ons. In a world where mul.ple expansion can no longer be assumed, this internal infrastructure oKen makes the difference between resilient returns and stalled assets.
Elsewhere in Europe, similar themes are playing out across the mid-.er. Inflexion, co-founded by Simon Turner and John Hartz, con.nues to demonstrate how disciplined interna.onal expansion and buy-and-build strategies can create scale
without sacrificing opera.onal control. The firm’s leadership evolu.on, including the rise of Flor Kassai as Managing Partner, mirrors a broader genera.onal shiK underway across European private equity one that blends ins.tu.onal maturity with entrepreneurial ins.nct.
At IK Partners, the emphasis has been on clarity of strategy and sector focus. Under Christopher Masek, the firm has aligned its organisa.onal structure closely with its investment approach, reinforcing the idea that successful mid-market inves.ng increasingly depends on specialisa.on and local credibility. These are the kinds of aPributes that allow firms to source proprietary opportuni.es and support management teams through complex growth phases.
Even firms undergoing transi.on offer useful lessons. The restructuring at Equistone Partners Europe, including clearer geographic delinea.on under leaders such as Grégoire Châ.llon, reflects the pressures facing mid-.er managers in a more selec.ve fundraising environment. For experienced investors like Gregorio Napoleone, such developments underscore the importance of strategic
coherence knowing where you compete, and being able to ar.culate why you win.
Despite these challenges, confidence in the European mid-market remains well founded. The region con.nues to generate a deep pool of high-quality businesses that are founder-led, opera.onally sophis.cated, and ready for the next phase of growth. For many of these companies, partnering with a mid-.er private equity firm offers the op.mal balance between capital, exper.se, and engagement.
As Gregorio Napoleone has oKen demonstrated through his investment career, success in this segment rarely comes from chasing trends. It comes from consistency, judgement, and the willingness to do the unglamorous work of building value over .me. In a market that has rediscovered the importance of those quali.es, Europe’s mid-.er private equity sector looks less like a compromise and more like the industry’s most durable centre of gravity.