Who’s Buying in the Lower Middle Market in 2026? Key Buyer Trends From Axial Data

The lower middle market buyer universe is getting bigger, broader, and more competitive. In 2025, Axial saw an all-time high in new buyers joining the platform, with 2,635 new buyside members, a 36% year-over-year increase.

But the biggest story isn’t the increase in volume; it’s the changing makeup of who is closing deals. Over the last five years, Axial’s closed deal distribution has shifted away from being dominated by Private Equity Funds and Independent Sponsors. Search Funds, Holding Companies, Family Offices, and Individual Investors represent a larger share of completed transactions, reflecting a more diversified pool of business acquirers in the lower middle market.

Despite differences in structure and investment strategy, Axial data shows a shared appetite for businesses in the $1M–$5M EBITDA range, with a particularly strong concentration in the $1M–$3M band. At the same time, select supply and demand mismatches are shaping buyer behavior, creating heightened competition in industries where buyer interest outpaces deal volume.

Included in the report:

• The number of active Axial buyers
• Deal demand by EBITDA range & firm type
• Trends in new buyers joining the platform
• Closed deal breakdown
• Average TEVs by firm type
• Featured 2025 closed deals
• Axial buyer definitions

Together, we hope these data points provide a clearer view of who is buying, what they’re targeting, and how buyer behavior is evolving over time.

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New Buyers Joining Axial | 2019 – 2025

The number of new buyers joining Axial has grown meaningfully over the past several years. After relatively flat growth between 2019 and 2022, new buyside members nearly doubled in 2023. That momentum continued in 2024, with a 38% year-over-year increase to 1,942, followed by another 36% increase in 2025 to reach 2,635 new Axial buyers. Below are select firms that became members in 2025 and are actively sourcing deals on the platform.

Featured New Axial Buyers

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Deal Demand By EBITDA Range

Below are the current deal intents by EBITDA range for active buyers on the Axial platform, broken down by industry and buyer type. 

Deal Intent Definition: A project created by a buyside member on Axial to signal the types of businesses they are actively looking to acquire or invest in, based on criteria like industry, size, and geography. Based on the specified range, deal intents can fall into multiple EBITDA buckets (e.g., $1M–$4M falls into both $1M–$3M and $3M–$5M).

Deal Intents By Buyer Type & EBITDA Range

Percent of buyers with this EBITDA Range in their investment criteria

Across firm types, buyer demand continues to be concentrated in the $1M–$3M EBITDA range, with each buyer category showing its highest share of active mandates (mid-90%) in that band. Interest remains strong in the $3–5M range and is meaningful in the $0.5M–$1M and $5–10M ranges, and tapers more noticeably at $10M+. While each group brings its own nuances, the data points to a broadly shared appetite for businesses in the $1–5M EBITDA range.

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Deal Activity vs. Buyer Interest

The table above offers a snapshot of buyer interest on Axial over the last 12 months, and where demand is strongest relative to deal flow. Industrials continues to lead, ranking #1 in both deal volume and investor interest. The consistency points to sustained conviction among buyers, likely tied to the durability, recurring demand, and essential-service nature of many industrial businesses.

Beyond Industrials and Consumer Goods (ranked #3 in both categories), there are notable supply and demand mismatches. Food & Hospitality ranks #7 in investor interest despite being #2 in deal activity, indicating that buyer enthusiasm has not kept pace with deal volume. 

By contrast, Business Services ranks #2 in investor interest and #6 in deal activity, pointing to elevated competition among buyers for a relatively limited pool of service-oriented assets. These imbalances are meaningful because they often shape buyer behavior. Sectors in which demand outpaces supply tend to see the most competitive bidding dynamics and urgency among acquirers.

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Closed Deals By Buyer Type | 2021 – 2025

In 2021, Private Equity and Independent Sponsors together accounted for 61% of all closed deals on Axial. By 2025, that combined share declined to 45%.

That shift has coincided with the emergence and growth of other buyer types. Individual Investors have increased their share to 13% in both 2024 and 2025, while Search Funds accounted for 14% of last year’s closed deals, an all-time high. Family Offices and Holding Companies have remained relatively consistent, representing an average of 15% and 10% of transactions over the last five years, respectively. The overall result is a broader mix of capital sources completing transactions, with a more balanced buyer landscape than in prior years.

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Average Closed Deal TEV By Buyer Type

Average total enterprise value (TEV) varies by buyer type and has shifted year over year. Private Equity posted some of the highest average TEVs from 2021–2023, peaking at $17.1M in 2023, before dropping to an average of $9.5M in 2025. That lower average is likely attributable to the amount of PE firms leveraging Axial to source add-on acquisitions alongside platform deals. As highlighted in this Axial’s article, approximately 50% of add-on projects on the platform are from PE Funds, which could naturally lower average TEV as firms pursue tuck-ins for existing portfolio companies.

Independent Sponsors have shown significant YoY variation in average TEV, reaching a high of $18.4M in 2024, compared to lower average deal sizes in the $8M range in both 2022 and 2025. That fluctuation may be partly due to deal-by-deal capital-formation dynamics, in which sponsor-backed raises, co-invest participation, and lender appetite can meaningfully influence transaction size, especially as borrowing costs and credit availability shift.

In 2025, Holding Companies had the highest average TEV ($17.4M), followed by Family Offices ($12.4M). In a financing environment in which interest rates were easing and lender confidence had begun to recover, buyers with substantial discretionary equity and flexibility in leverage were well positioned to pursue larger control transactions.

Meanwhile, Search Funds and Individual Investors have both trended upward in average TEV, with Search Funds surpassing $11M the past two years, and Individual Investors reaching $7.4M in 2025. These increases may reflect greater access to capital, improved lender support, and more sophisticated deal structures, enabling them to pursue larger opportunities.

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Featured 2025 Closed Deals

Private Equity Fund Heritage Holding Acquired Columbia Advisory Group as an Add-On for Complete

Heritage Holding, a Boston-based Private Equity Fund, acquired Columbia Advisory Group (CAG), integrating CAG into Heritage Holding’s portfolio platform, Complete. The transaction strengthens Complete’s managed IT and security services offering by adding CAG’s deep cybersecurity and compliance capabilities, enabling the combined platform to deliver more comprehensive, end-to-end technology and risk management solutions.

The shareholders of CAG engaged Solganick & Co., a Los Angeles Investment Bank and Axial member since 2012, to evaluate potential M&A opportunities and conduct a competitive process to identify the best possible partner. Solganick brought the deal to market via Axial in January 2024, targeting PE-backed strategic buyers. Heritage Holding, known for its investments in growth-oriented technology companies, pursued the opportunity in December 2024 and successfully closed the transaction in June 2025, expanding Complete’s platform.

 

Houston-based Independent Sponsor Thesis Capital Partners Acquired The Ridge Ohio

Thesis Capital Partners, a Houston-based Independent Sponsor, acquired The Ridge Ohio, a physician-led behavioral health provider offering discreet, evidence-based addiction treatment. The partnership positions The Ridge for strategic growth, including expansion of its clinical team, enhancement of holistic offerings, and continued investment in its 51-acre campus.

Founded in 2011 by emergency physician Dr. Jeffrey Stuckert, The Ridge provides individualized addiction treatment in a luxury residential setting, offering inpatient and outpatient programs at its Cincinnati and Columbus locations. The treatment model integrates clinical rigor with holistic therapies, including music and art therapy, meditation, and nutrition counseling.

The Ridge was advised by Michigan Investment Bank Cascade Partners, an Axial member since 2014.

 

Family Office 119th Street Capital Acquires Armada Analytics

119th Street Capital, a Merrillville, Indiana-based Family Office with an exclusive focus on investments within the financial services, acquired Armada Analytics. Armada Analytics provides strategy, analytics, and data-driven advisory services that help clients transform complex data into actionable insights to improve performance, optimize operations, and drive growth across industries. Headquartered in Greenville, South Carolina, Armada operates offices in Dallas, Texas; Gaithersburg, Maryland; and Troy, Missouri.

119th’s investment in Armada provided financial and strategic resources for the continued organic and inorganic growth of the business while preserving its best-in-class culture and client-first service model. Tower Partners, a Columbia, Maryland-based Investment Bank, advised Armada in the sale process, marking their second closed Axial transaction in 2025.

 

Crane Group Expands Fairwood Brands Platform with Acquisition of Executive Landscaping

Crane Group, a Columbus, Ohio-based Holding Company, acquired Executive Landscaping as an add-on investment for its portfolio company, Fairwood Brands.

Founded in 1996 by Chris Cotoia, a 12th-generation native of Cape Cod, Massachusetts, Executive Landscaping is Cape Cod’s premier landscaping design, construction, and maintenance company.

Fariwood Brands is a nationwide family of companies that create and maintain premium outdoor spaces while delivering gold-standard customer service. These companies specialize in luxury landscaping and estate management.

Madison Street Capital, an Austin, Texas-based Investment Bank and Axial member since 2011, served as the exclusive advisor to Executive Landscaping.

 

New York–Based Net at Work Acquires NCS to Accelerate Midwest Expansion

Net at Work, a Corporation headquartered in New York City with multiple U.S. office locations, acquired Network Computer Solutions (NCS) in December 2025. NCS is a Kansas-based Managed Services Provider with a 25+ year track record of delivering high-impact IT services to small and mid-sized businesses. 

The acquisition supports Net at Work’s continued Midwest expansion and strengthens its managed services capabilities. Clients of NCS will benefit from access to Net at Work’s broader suite of services, including cybersecurity and cloud solutions, ERP, and business application consulting.

Four-time Axial closer, Vista Business Group, an M&A Advisory Firm based in Lincoln, Kansas, served as the exclusive advisor to NCS.

 

Search Fund Maracas Capital Acquires Holden International Inc.

Maracas Capital, a Search Fund based in University City, Missouri, acquired Holden International Inc., a Florida-based gift and novelty wholesaler. Watertown M&A, a North Carolina M&A Advisory Firm, represented Holden, bringing the opportunity to market via Axial in Q1 2025.

Holden International specializes in personalized products, gifts, and souvenirs sold through freestanding floor displays in retail stores and tourist attractions, including theme parks, zoos, aquariums, and gift shops.

Christopher Pitts, Managing Partner at Maracas Capital, joined Axial on March 15th, 2025, to source and acquire Main Street businesses. Pitts activated the firm’s first buyside project on March 17th, pursued the Holden International opportunity on May 7th, executed the LOI on July 1st, and successfully closed the transaction on October 16th.

 

Individual Investor RCM Legacy Capital Acquires Maintenance Chef

Individual Investor Tres McVean of RCM Legacy Capital joined Axial to source and acquire a business to own and operate. Tres activated his Axial membership on October 10, 2024, and pursued the Maintenance Chef deal, represented by Sunbelt Business Brokers of Colorado Springs, on his very first day. After pursuing a handful of additional opportunities during his first week on the platform, Tres ultimately focused on Maintenance Chef, executing a Letter of Intent on November 4, 2024, and successfully closing the transaction on April 28, 2025.

Maintenance Chef has been in business for nearly 15 years, offering repair, maintenance, and installation services for commercial kitchen equipment and HVAC in the Denver Metro Area and Colorado Springs. 

Tres McVean, now Owner and President of Maintenance Chef, is currently pursuing bolt-on acquisitions on Axial in the commercial appliance repair and maintenance space.

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Buyer Type Definitions – According to Axial

Axial categorizes buyers into distinct types to help business owners and advisors understand the core differences among firm types in the current buyer universe. The following are Axial’s buyer type definitions, each paired with a current Axial member that fits the profile.

Private Equity Fund: A private equity investment firm with legally enforceable capital commitments that enable the firm to call capital at its discretion from a group of already committed limited partners (“LPs”). 

Independent Sponsor: An individual or investment firm raising external equity capital on a deal-by-deal basis to fund acquisitions. Independent Sponsors are formed with the intent to acquire and/or invest in multiple companies.

Family Office: A flexible investment entity using permanent family capital formed to support the investment and administrative objectives of a private individual or family. The family office typically makes a variety of investments in private companies, funds, and related opportunities, and has the flexibility and internal capital to lead acquisitions and act in more limited capacities.

Holding Company: A capitalized entity that owns a controlling interest in one or more companies and typically operates as an umbrella or parent company where the primary capital used to acquire assets, or “holdings,” comes from the parent company’s balance sheet. 

Corporation (Strategic Acquirer): An operating company that is seeking to acquire one or more additional operating businesses to integrate into or complement its existing business operations.

Search Fund: An individual or set of co-founders that has the sole purpose of acquiring a single, privately-held business and assuming management responsibilities at the acquired company. 

Individual Investor: An individual who meets the requirements of “Accredited Investor” defined in Rule 501 of Regulation D under the Securities Act. This member type is typically looking to build a portfolio of direct investments in private companies. They utilize their own capital to fund deals rather than raising external capital. This member type typically does not assume the CEO role at the companies in which they invest. This renders them distinct from independent sponsors and traditional search funds.

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Axial is the trusted deal platform serving the lower middle market ($2.5-$250M TEV).

Over 3,500 advisory firms and 3,000 corporate and financial buyers have joined Axial to efficiently connect with relevant capital partners, source actionable deals, and build new relationships.

Visit the Member Closed Deals page to see selected transactions that have been sourced and closed via Axial.