Rick Kes
Appearances
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
And then I think those are the organizations that perhaps four or five years ago when there was a pretty big boom in the economy for deal exits or deal transaction activity, those businesses were trading at multiples that I think are going to be hard to achieve in the current environment. So, you know, maybe their expectations are a little higher than they could or should be otherwise. So I think
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
you know it's a it's again you know i think it really comes down to each individual business and transaction kind of stands on its own in some respects and and if you kind of boil them all together you know the ones that are really well ran and have you know really you know easy to sell ideas and concepts and technology i think those are the businesses that seem to move along
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
I think the ones that are maybe a little less sophisticated, I think those tend to have a little bit harder time to move unless the seller is willing to concede on some pricing and sell at multiples that maybe, you know, they wouldn't have expected, you know, three, four or five years ago.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
Yeah, I completely agree with that sentiment. I think, you know, the days of just buying and building and not really doing anything new to the business and then creating value that those days seem to be gone. I think you need to buy, build and become more efficient or do something different with that business.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
Like, you know, obviously, Scott, you know me well enough to know that I'm very keen into health care and, you know, if you just said, oh, we're going to take a bunch of physician practices and roll them up and sell them, that model isn't exactly the model that is being bought and sold today. But if you buy a bunch of physician practices,
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
build a value-based care model, do something different, use technology to advance and become more efficient or to reach patients in places that you wouldn't have been able to reach patients before. If you're changing the business and becoming more, advanced and pushing the needle in the industry, then you're creating value.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
So I think just buying and building and creating scale that may make some minor arbitrage ability, but I think buying, building and changing the business to become more attractive to the next buyer. I think that's really where you'll find, you know, that arbitrage that you're talking about.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
You know, I think, you know, we're very, you know, in touch with, you know, what's going on, I think, in D.C., you know, and some of the changes that's happening kind of in the political spectrum.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
You know, I think if you look at some of the changes that the Trump administration is making with the number of people being laid off and some of the different agencies and parts of the government, it starts to wonder, like, you know, with the employment market as tight as it is, you know, where can those people
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
go and what value those people can bring to businesses that maybe would find their expertise and experience from working inside the federal government for as long as some of those people have had. How that is going to be potentially, you know, somewhat of a boon to government contractors in the DC area.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
There's a lot of health tech in the DC area that I think could look to those people and say, hey, maybe these are the people that we could benefit from and fill some of the spots that we're trying to fill because of how tight the labor market is already. So I think, you
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
that's a really interesting thing to me is just to watch you know what's going to change with these people kind of becoming um employable now and you know again looking at what their experience and their skill sets could be and how valuable that could be for some of our clients that's where i'm kind of getting excited in some respects unfortunate for them that they're losing their jobs but maybe fortunate for some of our clients that those people now become employable and potentially valuable for for businesses in the in the coming months and weeks
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
Yeah. I mean, you know, I think, um, What we see with our clients is a lot of just, you know, every story is different. Every client, every situation is different. You know, some of our clients that, you know, have, you know, businesses that are really well ran, have a good track record, executive talent on their team.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
you know, have a really strong business model, maybe have some ability to show how they differentiate using technology or, you know, something else in that respect. You know, those businesses seem to, you know, move along and exit just fine.
Becker Private Equity & Business Podcast
Navigating the Changing Exit Market: Insights from Rick Kes of RSM 2-26-25
I think the organizations that we see that have a higher level of struggle or maybe those that, you know, are maybe a little laggard in their technology advancements, you know, somewhat, you know, kind of, more traditional in their business models and not maybe advancing things and pushing the needle, so to speak, and kind of being a leader in the industry.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
You know, if you think about timing, if investments were made in 2016, 2015, you know, 2013, 2014, sometime in that period, and then you put yourself like five, six, seven years into old period, you run into COVID. COVID obviously disrupts the entire economy and has long-term impacts. You know, three, four, five years out, we're still seeing impacts related to COVID, especially the deal prices.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
So, I mean, you know, some of the exits that have happened perhaps didn't happen at the price that the buyer was initially hoping for. They had to make a deal because of whatever reason that might have been out there for them. And then the growth of the company and some of the other things related to that company might have been different than what they would have expected pre-COVID.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
And so I think that if you think about what COVID did to the private equity hold period,
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
I think you're seeing that come through in some of these other things that are being announced in the world related to a longer hold period, maybe some of the sale prices not being where they would have hoped for, expected, and perhaps an appetite for a longer period of a hold period because maybe they're able to kind of fix some of the things that happened during the COVID shock and then really be able to kind of
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
grow from there and then amplify growth in the future. So I think if you take it back from at least my perspective, a lot of this has to do with kind of the economic shock that COVID brought us to the entire economy.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
Yeah, I do think that's true. You know, I think with inflation and like you mentioned, the job environment kind of being where it's at.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
you know if we're at a full employment you know world and inflation still kind of is that I clipped above where the Fed wants it to be you know they don't have a lot of other you know levers to pull you know to reduce interest rates would just create more inflation in theory and so I think We'll continue to monitor it.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
But I think at some level, too, we have to balance that between the fact that we have full employment is also great for the consumer. Right. And I think if you think about our economy being heavily driven by consumer discretionary spending, you know, that's a big part of why we should continue to think about how do we capitalize on that piece of it and really try to
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
maybe manage what we can as business owners or private equity fund managers or whoever we are in the ecosystem and try to figure out, well, the interest rate environment is sort of out of my control. But one thing that is in my control is finding the consumers and taking more of the market share from them because they have cash, they're employed, they're out there working.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
Let's find a way to get them to spend money in our business as opposed to somebody else's business.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
Yeah, I think that's spot on, Scott. I think it just brings you back to really what we were talking about maybe even a year ago or even before that, before any interest rate cuts, when the interest rate environment is a little bit out of your hands, you can find value in other places to really drive even a growth and attraction.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
Because I think what I keep hearing from private equity firms is that A assets still trade, B assets may or may not trade, C assets and below, it becomes very, very difficult to trade those assets. So I think you really need to focus on making your business as close to or an asset as possible so that you can find value.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
And by doing that, I mean finding opportunities to become more efficient, finding opportunities to really advance your leadership team within that company.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
and really finding ways to drive value beyond maybe what the interest rate environment might may create for you you got to figure out what you can actually control and that's typically you know finding opportunities to bring value to those businesses that you own and be able to make them attractive to buyers regardless of the interest rate environment that you might be in
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
Thank you, Scott.
Becker Private Equity & Business Podcast
Private Equity’s New Reality: Delayed Exits, Interest Rates, and Value Creation with Rick Kes of RSM 2-19-25
intro to the question of what do you see on these delayed exits and what should we expect yeah scott i think it's a fascinating question and obviously one that we have a lot of discussions with our private equity group clients about and i think if you kind of peel back some of the pieces the onion
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
Yeah, it's hard to say, but I think one of the last episodes, you and I talked a little bit about the credit market and access to credit and even well-capitalized, highly-rated organizations were having some concerns accessing the debt market. I think this probably just adds some more, again, for the lack of other words, the proverbial uncertainty as it relates to access to credit.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
And I think credit is such an important vehicle for private equity to use to leverage where they're going to do a buyout or what have you. But on the other end, a lot of deals are being executed today using credit
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
other alternatives whether it be rollover equity or other things to kind of capitalize some of the transactions so you know i think it could have some impact uh the impact is on i guess it's a little hard to predict per se but i'd say i think to me the biggest concern would be the access to to further liquidity for some of these deals that we're hoping to finance
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
Yeah, we had a call this morning with all the partners of the firm, just listening to some of the perspectives that our Washington national tax leaders have. And I think there's some discussion in the bill related to a lot of the things extending what the tax cuts and jobs acts did in the previous Trump administration. So some of those things would be kind of
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
I would say sometimes positive from a tax perspective to some of our clients. I think there'll be some changes potentially to the interest deductions. Currently, some of the interest deductions are limited or capped at a certain level for different businesses. You know, some of those things I would say are what we're hearing are probably, you know, somewhat business friendly.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
But obviously, you know, for every push, there's a pull, so to speak, in the tax bill. So, you know, from, again, back to the health care ecosystem, you've got, you know, some negative impacts with Medicaid and some other issues. you know, potential changes to, you know, subsidies for ACA plans or exchange products that are offered to people that buy their own insurance.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
So, you know, there's some good and some bad from all those perspectives. But, you know, I think all in all, you know, I'd say for the first in particular in the non-healthcare ecosystem, it could be more positives than negatives within the tax bill currently structured.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
Yeah, I mean, Scott, I think, you know, kind of unfortunately, much of the same as we've been talking about for the last couple of months. You know, I think there's a lot of interest and opportunity out there. But with all that interest and opportunity, there's also, you know, a fair amount of uncertainty there.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
Yeah, I mean, I think I mean, obviously, my perspective is usually time removes uncertainty risk. So hopefully we get more and more time away from, you know, some of the things that we kind of consistently hear about, whether it's tariffs or Medicaid changes or, you know, tax cuts or, you know, tax extenders and things like that. And we kind of learn everything.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
what the new reality is and then understand how that's going to impact our businesses, be able to price that into our deal economics and then start making deals. So I guess I hope for the elapse of time so that people can start
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
know having less uncertainty and start making some you know movement in terms of the deal environment um so i'd say that's probably top of the list you know second but very close to that list is hopefully seeing the timberwolves advance past the oklahoma oklahoma city thunder
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
and play in the NBA Finals, ideally against the Knicks, because it would be wonderful to see Karl-Anthony Towns come back and play against Anthony Edwards and see how that works. But I'd say those are the two things that kind of excite me at this point in time.
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
in different sectors especially you know obviously i cover health care the closest you know there's some uncertainty there uh with some of the budget reforms that are being discussed so you know i think you know there's a lot of interest a lot of opportunity a lot of you know a lot of excitement um you know a lot of dry powder but you know a lot of things that are kind of holding people back in terms of moving forward but you know i'm i'm hoping that you know as the temperatures continue to rise that
Becker Private Equity & Business Podcast
Private Equity Outlook Mid-2025: Cautious Optimism, Credit Concerns, and Tax Talk with Rick Kes of RSM 5-20-25
Some of that uncertainty sort of, quote unquote, melts away and, you know, that we start to move forward with some deal activity here in the next, you know, two to four months or so.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
Positives and negatives to lots of different things that are happening from a legislative perspective, depending on the industry, the market, etc. So I do think that the overall uncertainty
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
typically isn't good for deal makers because they're not sure how to price in the uncertainty risk and how to kind of address that within their valuation and their modeling and all those kinds of things because uncertainty is something they just can't really predict the future for. So I do think it does have its contagions to the private equity market.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
You know, it's really difficult to kind of have a prediction just because I think so much has happened in the last three months that has been unpredictable. So I guess to dodge your question as best as I can, I don't have a prediction. And it's maybe not so much on the reasons that you outlined, but more on the reasons of like it's just an unpredictable situation that we have.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
So we're not really sure what could or might happen.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
Ja, ich meine, Scott, ich denke, ich nehme es zurück zu den Grundlagen und kontrolliere das Kontrollable. Und ich denke, unsere Theorie seit langem ist, dass du dein Bestes tust, um super effizient zu werden. Bringe dein Geschäft zu einem A-Qualität-Asset und lass den Geräusch den Geräusch sein.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
Aber wenn du der beste Asset in der Klasse bist, dann ist ein bisschen dieser Geräusch nicht so wichtig für dich, wie es für die Fringe-Spieler in deiner Asset-Klasse wichtig ist. Ich wünsche meinen Klienten, sich zu bewegen, die Technologie zu nutzen, um effizienter zu werden.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
Sie sollten schauen, wie Sie Ihre Kostenstruktur in Ihren vier Wäldern aufrechterhalten und der beste Asset-Performer in Ihrer Klasse werden. Und einige dieser Geräusche werden nicht so viel für Sie als für andere bedeuten.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
Thank you, Scott.
Becker Private Equity & Business Podcast
Private Equity in Uncertain Times: Insights from Rick Kes of RSM 3-11-25
I don't think it's accretive to the deal market. I think the noise does have its impact in the private equity world, just because it creates so much uncertainty. What will happen next sort of thing and how it may impact, you know, a business's overall value proposition, you know, and whether you're in health care or banking or manufacturing, you know, like there are.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
And to your point, the other idea is just moving on and figuring out what exits can happen and what activity could happen, even absent the interest rate environment. Because obviously, there's some noise. suggesting inflation still maybe not yet to where the Fed would like it to be.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
I think some data came out late last week that showed personal consumption around 2.5%, which I think the target's around 2%. So that could be a little bit of a headwind against lowering interest rates. And then, of course, you know, I think there was some data from a manufacturing perspective around manufacturing purchasing up about, you know,
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
14, 15% because of tariff and tariff-related price adjustments. And so I think because of those two things, we may not see the interest rate environment be as favorable as we would have hoped absent those two data points and other data points, obviously, to that impact. So I think because of that, you know, funds are just obviously reacting and saying, we got to do something.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
Let's move forward and move on and, you know, make something work.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
Yeah, I think to your point, Scott, it just goes to show that you pull one lever, one thing happens that you might see immediately, but other impacts happen kind of ancillary to that lever. And so I think nothing happens in a vacuum in reality in the global economy that we live in.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
And I think to your point, you would like to think perhaps you could say that there's a push for every pull or a pull for every push, but- there could be multiples of that in any direction.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
And so you don't really know, you know, the ultimate impact to global GDP or the U S GDP of any certain thing, whether it's tariffs or inflation or jobs reports or anything like that, until you get the chance to look back and kind of study it. And unfortunately, most of us can't wait for the data to kind of realize itself to the point where we can make those perfect, you know,
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
assumptions and ideas and react in the way that we would if we had all the information available we have to kind of react in the real time and and make decisions and and move forward and put like you said put money to work i mean there's you know again and there continues to be a lot of money on the sideline and a lot of opportunity for activity and i think some of us are just thinking at some point
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
we're just going to have to move forward because if we're just going to wait for interest rates to go down or wait for this or that to happen, we may be waiting for longer than we really have afforded to us.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
Thank you, Scott.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
Yeah, Scott, I think in some sense, the overall market conditions that we're seeing, I would think, people are getting a little bit more, I guess, understanding of the interest rate environment and understanding of the fact that there's a lot of things that may or may not be you know, beneficial to the lowering of the interest rates.
Becker Private Equity & Business Podcast
Private Equity Trends: Exits, Capital Calls, and Market Uncertainty with Rick Kes of RSM 3-4-25
So I think some people are almost putting that aside and saying, okay, well, you know, we can't do much about this, right? And so we need to do something. And, you know, perhaps to your point, you know, it's selling within the same fund family. That could be one idea.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Any investor, it doesn't matter if you're private or public, but if there's uncertainty in the market, it's harder to predict what will come together in the future.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
So it's not unlikely that somebody would say that right now we've got a pretty high level of uncertainty of where the future will go, whether it be because of tariffs or other regulatory challenges that have come up in the recent kind of Six to eight weeks or so. So, you know, I do think there's a lot of uncertainty, but I think with that uncertainty, there's opportunity to find value.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
I mean, I think, you know, we continue to work with our clients on becoming more and more efficient because, you know, and more and more. in the direction of a higher quality asset because i do think there's still money to be spent there's still investors that want to get into new sectors or new markets or new what have you so i think the assets that seem to continue to have
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
The ability and desirability to be traded are those that are operating at the highest level that they possibly can and that are considered A-Assets, so to speak. So that's really where we come to our clients at. If you have the desire to be traded in the near future, you have to become as close to an A-Asset as you possibly can. Otherwise, it's going to be somewhat challenging.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
But if you are an A-Asset, dann hast du die Fähigkeit, in einem Moment in der neuen Zukunft zu handeln.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Exactly. You know, I think you got a lot of people with high levels of anxiety related to the uncertainty. But, you know, again, when there is uncertainty and the things that are as close to certain as possible. So things that have, you know, relatively less, you know, demand elasticity. So things like, you know, healthcare services, which obviously I spend a lot of time in.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Other things that, you know, maybe have a little less exact, you know, kind of impact related to other, you know, economic impacts. So, you know, I do think that there are areas of opportunity.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
I don't know about MedSpa specifically. I don't spend enough time digging into the data behind MedSpa. Conceptually, I think there are some fact patterns there that make sense to me. I know my social network of people. I think a lot of people value that type of service at a pretty high premium. So I do think that there is some logic behind saying it would take a pretty drastic change
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
No, thank you. But your overall take is, look, it's a little bit...
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Yeah, and I think a lot of private equity group LPs, some of them are large pension funds and other large institutional investors. If you think about it from their perspective, they're involved in private equity to try to minimize the volatility of the public markets.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Die öffentlichen Märkte sind so volatil, dass man sich fragt, ob das der Zeitpunkt ist, um Privatwerte zu zeigen, die ihren Wert auf Stabilität und langfristigen Wachstum zu bringen. Wir haben uns natürlich gesagt, dass wir anders als die öffentlichen Märkte sind. This is our opportunity to prove it to you.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
And so I think that's another area that our private equity clients are really trying to focus on, is how do they make sure that they're kind of consistently telling that story of value to their LPs, considering the relatively high levels of volatility that they're seeing in the public markets on their other parts of their investment portfolios.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Ja, und ich denke, das ist die Botschaft, die die Privat-Equity schon seit langer Zeit erzählt hat. Und ich denke, dass sie bis jetzt die langfristige Wertschätzung beurteilen konnten. Aber jetzt ist es ein weiterer Weg, ihnen zu zeigen, dass das ein Asset Class ist, der helfen kann, dein Portfolio in diesen relativ ungewöhnlichen Zeiten zu balancieren.
Becker Private Equity & Business Podcast
Finding Opportunity in Uncertain Markets: Insights from Rick Kes of RSM 4-24-25
Well, you know, Scott, I would love to be able to just come on and talk about all the positivity that we're hopeful for. But I mean, I do think that there are pieces of positivity out there when it comes to private equity. Obviously, you know, there are there are headwinds against us. You know, I would say, you know, uncertainty is never good for us.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, I mean, obviously, with the news that broke this morning about a 90-day pause on certain tariffs with China, I think that's interesting news for sure. And I wasn't surprised to see the markets react in a favorable fashion to that. I do think, like we've talked about before, Scott, that The public market is obviously very easy to read. It's very easy to obtain data about.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
It's very easy to kind of get insights. You can pop on CNBC or Bloomberg Television or whatever you want to watch and get a lot of great intel and kind of the sentiment of the street, if you will. It's a lot harder in the private equity world, as you know, because, you know, a lot of that stuff is just quite frankly private. And so really harder to get to it.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
You know, I think we spent a lot of time, obviously, with fund fund managers, you know, people within private equity groups, people at the portfolio level. I think the overall sentiment is that a lot of them are kind of cautiously optimistic and they've been that way for a long time.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
I think we all see a lot of the data points, whether it be dry powder or hold periods or other things where we start to think, well, if we just get a couple nice, you know, momentum changes, whether it's interest rate cuts or, you know, good deal environment or any, you know, any little thing that could help, you know, push the ball down the hill.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Once that ball starts, I think a lot of people are hoping that it keeps rolling. And, you know, I think that there's some truth to that. So I think, you know, The news that broke today is great. I think it pushes people into a positive sentiment overall, even though it's more probably from the public markets.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
But I think overall, positivity is going to help push that ball forward and start to gain momentum and speed and have it go down the hill and start the deal flow volume that I think we've all kind of been waiting for for the last 18 months or so.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, very much so. And I think the other... thing that sounds to be a bit of a challenge is even You know, one thing is affording the interest rates, you know, just being able to cash flow it and or, you know, produce, you know, sustainable margins, including interest expense.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
But on top of that, it's even just access to capital sometimes can be really challenging for some of these businesses, even well capitalized or highly valued companies are starting to have a sense that capital access is Not quite what it was, you know, maybe, you know, three, four years ago or the last time they went to the bank and asked for some additional capacity.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, Scott, thank you. Yeah, for those of you who aren't familiar with RSM, we are the leading provider of services to the middle market. So we are the fifth largest professional service firm in the U.S., very focused on companies, you know, around a hundred million dollars to about $5 billion of revenue.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
So, you know, I do think that continues to be an interesting environment, you know, from a bank financing perspective.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, yeah, that's very, very true. And it's got great, great taste in TV shows. I love Landman. Billy Bob Thornton is one of the most talented actors of our time. He's just crazy how well he can kind of adapt into that role. It's quite interesting compared to what you see from him and kind of in his non-character role. So that's a great show. I very much enjoy that show.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
I have not yet got to that show. It's on my list. It's definitely on my list. But as you know, I have three kids under the age of 14. They're all boys. They're all busy. So my ability to watch multiple shows at one time starts to get a little compressed. So I'll have to have to add that into the queue or bring it up close to the top of the queue for sure.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
So big swath of the GDP, roughly about a little over a third of the overall GDP is represented in that client base. So, you know, we provide tons of services to private equity companies and their portfolio holdings due to the fact that many of them kind of sit in the middle market. And we have been doing so for a very long time and build a pretty robust
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
both brand reputation in the market as well as just kind of infrastructure of managing our private equity relationships in a way that we think differentiates us from the competitors. You know, me, myself, I've been at the firm about 20 years, served in many roles within the industry of healthcare and overall just private equity related management.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
So I'm glad to be part of the conversation and, you know, talk a little bit about what's going on and what we're seeing.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, I mean, obviously, with the news that broke this morning about a 90-day pause on certain tariffs with China, I think that's interesting news for sure. And I wasn't surprised to see the markets react in a favorable fashion to that. I do think, like we've talked about before, Scott, that The public market is obviously very easy to read. It's very easy to obtain data about.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
It's very easy to kind of get insights. You can pop on CNBC or Bloomberg Television or whatever you want to watch and get a lot of great intel and kind of the sentiment of the street, if you will. It's a lot harder in the private equity world, as you know, because, you know, a lot of that stuff is just quite frankly private. And so really harder to get to it.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
You know, I think we spent a lot of time, obviously, with fund fund managers, you know, people within private equity groups, people at the portfolio level. I think the overall sentiment is that a lot of them are kind of cautiously optimistic and they've been that way for a long time.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
I think we all see a lot of the data points, whether it be dry powder or hold periods or other things where we start to think, well, if we just get a couple nice, you know, momentum changes, whether it's interest rate cuts or, you know, good deal environment or any, you know, any little thing that could help, you know, push the ball down the hill.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Once that ball starts, I think a lot of people are hoping that it keeps rolling. And, you know, I think that there's some truth to that. So I think, you know, The news that broke today is great. I think it pushes people into a positive sentiment overall, even though it's more probably from the public markets.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
But I think overall, positivity is going to help push that ball forward and start to gain momentum and speed and have it go down the hill and start the deal flow volume that I think we've all kind of been waiting for for the last 18 months or so.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, very much so. And I think the other... thing that sounds to be a bit of a challenge is even You know, one thing is affording the interest rates, you know, just being able to cash flow it and or, you know, produce, you know, sustainable margins, including interest expense.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
But on top of that, it's even just access to capital sometimes can be really challenging for some of these businesses, even well capitalized or highly valued companies are starting to have a sense that capital access is Not quite what it was, you know, maybe, you know, three, four years ago or the last time they went to the bank and asked for some additional capacity.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, Scott, thank you. Yeah, for those of you who aren't familiar with RSM, we are the leading provider of services to the middle market. So we are the fifth largest professional service firm in the U.S., very focused on companies, you know, around a hundred million dollars to about $5 billion of revenue.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
So, you know, I do think that continues to be an interesting environment, you know, from a bank financing perspective.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
Yeah, yeah, that's very, very true. And it's got great, great taste in TV shows. I love Landman. Billy Bob Thornton is one of the most talented actors of our time. He's just crazy how well he can kind of adapt into that role. It's quite interesting compared to what you see from him and kind of in his non-character role. So that's a great show. I very much enjoy that show.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
I have not yet got to that show. It's on my list. It's definitely on my list. But as you know, I have three kids under the age of 14. They're all boys. They're all busy. So my ability to watch multiple shows at one time starts to get a little compressed. So I'll have to have to add that into the queue or bring it up close to the top of the queue for sure.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
So big swath of the GDP, roughly about a little over a third of the overall GDP is represented in that client base. So, you know, we provide tons of services to private equity companies and their portfolio holdings due to the fact that many of them kind of sit in the middle market. And we have been doing so for a very long time and build a pretty robust
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
both brand reputation in the market as well as just kind of infrastructure of managing our private equity relationships in a way that we think differentiates us from the competitors. You know, me, myself, I've been at the firm about 20 years, served in many roles within the industry of healthcare and overall just private equity related management.
Becker Private Equity & Business Podcast
Private Equity Sentiment, Market Momentum & Access to Capital with Rick Kes of RSM 5-17-25
So I'm glad to be part of the conversation and, you know, talk a little bit about what's going on and what we're seeing.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
Yeah, I mean, I think you put yourself back to, you know, 2020 and you saw the volatility we saw during the pandemic. Now, this is obviously not a global pandemic. This is something much different than that. You know, there was a ton of volatility then. And then the reaction was probably more positive than anybody would have expected fairly shortly after that.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
So could there be reaction that would be positive from this? I'm not sure. It's probably... too uncertain to know at this point in time. But, you know, again, I'd say it's more, we're still in the area of uncertainty, not certainty as it relates to what this will do for the rest of 2025 and the deal environment for private equity.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
Yeah, I think that's all we can do at this point. I mean, I think our advice to our clients continues to be, as it has been for a while now, Control what you can control. You know, if you're, you know, most of my clients are service based clients. They're not importing a ton of stuff. They're not buying a lot of supplies.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
You know, they've got some, but not overly dependent on purchasing goods from overseas entities. And so, you know, if you're a services based company, you know, Labor still looks to be a little bit challenging. You know, we added more jobs last month than we thought we were going to. You know, we're still in that stage.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
But, you know, I think we need to really buckle down and focus on becoming the most efficient organization we can, because I think as we've talked about in previous episodes. the attractive assets, the A assets, if you will, still seem to be trading in early parts of 2025 and late 2024.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
It's the less attractive assets, the assets that haven't created efficiencies, that haven't built in scalable technology, that haven't been able to integrate bolt-on transactions effectively. Those are the organizations that haven't traded. So I think, again,
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
I think we really want our clients to focus on what they can control and becoming efficient and making their asset as, you know, attractive to a potential buyer, whether it be, you know, the next three weeks or in the next three months or the next three years.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
Yeah, Scott, I mean, I think, you know,
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
Yeah. I mean, that's, that's, you know, the cycle we continue to see in business forever, right? Like overreaction to negative news, sometimes an underreaction to positive. And it just, you know, maybe a little bit more time to elapse to have that positive effects in, you know, kind of come together. So again, we'll see, you know, what, what happens if that cycle continues to repeat itself or, you
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
You know, if this is a new version of the cycle where, you know, maybe it is a longer term kind of turned down than we would have expected.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
some respects you know not to punt on the question but it's a little early to totally understand you know what the deal environment will look like post you know last week um but i think you know kind of the early chirpings that we're hearing early indications that we're hearing is you know just like anything uncertainty creates a likelihood that um deal activity won't be as
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
Thanks, Scott.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
you know, robust as we would have thought without uncertainty.
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
So I think it just adds another layer of uncertainty to the other items that we've already had that layered upon layers of more and more uncertainty that I think, you know, it could create a little bit of lag in terms of some of the deals that maybe would have gone into the pipeline, you know, this week, next week, or the week after, you know, you might see some slowing in that just to see kind of what,
Becker Private Equity & Business Podcast
Market Volatility, Tariffs & the Future of M&A with Rick Kes of RSM 4-7-25
not only the public markets, but other private markets, et cetera, would have in terms of reaction to the news and the effects that we're seeing in the public market last week and earlier today.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
So you'd think at some point, some of these assets will start trading again, and some of these funds will put their capital that they have available to use. But at what point that might be, it's hard to tell.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
I mean, unless you have a crystal ball, I guess, you know, so, you know, I think, I think we'll continue to kind of work on, you know, being prepared when, when that deal full volume kind of opens up, if the spigot opens up, so to speak. And then, you know, I think at this point we're still kind of waiting for that to happen.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Yeah, I mean, obviously the public markets inform people just because of the availability of data, right? People can access it, they understand it, they see it on the news, everything, you know, it's right in front of you all day long. So, you know, I think the public markets influence sentiment, they influence lots of things. So,
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
I think as the public market continues to hopefully recover from the turmoil we saw during the last couple of weeks related to tariffs and other things, I think that will create better sentiment, which will obviously just hopefully change the mindset of a lot of people. But I think because of that, you'll see hopefully some recovery, some rebounding. But I do think the other part too is just,
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Timing is everything. And, you know, as we see these, you know, negative news stories come out, you know, as time elapses, people start to forget about it or we start to understand what the real impact is and not just rely on kind of the news headlines. We see like, OK, well, if tariffs went up, what happens to the price of this product or that product?
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
instead of uncertainty, now we have certainty. We start to know, we start to figure things out, we start to realize how we can adapt. And I think the successful businesses will adapt quickly and hopefully be prepared to move forward with things that they were originally planning on doing. So again, I think these times, just like any times, we talk a lot about
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
when deal flow isn't happening, focusing on your business model, focusing on your efficiency and focusing on becoming the highest grade asset you can be, I think in addition to focusing on those things, also focus on being nimble and understanding how to adapt and change to the economy as it continues to change because those are the companies that are likely to be the most ripe for sale are those that can prove that they're
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
their ability to adapt is a market differentiator against their competitors.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
I mean, I think that's the definition of success in some respects is to, you know, I think a good leader can lead their team through that turmoil, right?
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
You hear something, you know, I hear a bad news story or something, maybe even something that's impacting your sector, say you're in healthcare services and you hear all these news about potential cuts to Medicaid and maybe you're heavily relying on Medicaid. If the leader of your company or the leader of your PE group is telling you, hey, We're going to get through this.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
We're going to move forward. We're going to find a way to be profitable even under reduced reimbursement rates or something. If the leader of your group is telling you that and making you feel that that's accurate and that you can achieve those goals, well, then, you know, that's how you succeed in the business. So I think it all comes down to good leadership, really.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Yeah, I mean, Scott, I think, you know, obviously the deal world's been a little slower than anyone would probably like it to be. Lots of reasons for that, obviously. You know, we've got interest rates, you know, higher than we would normally like them to be. We've got, you know, political uncertainty, things of that nature.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Well, yeah, and almost to some extent, if you're confident in your business model and you're confident in your ability to succeed, double down, you know, invest heavily in the dip, right?
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Like understand that this is a time to really focus on your business and to, you know, make sure that you're as efficient as possible, that your technology is as strong as possible to run your business so that when you can grow, when you can do acquisitions and bolt on that your platform is sustainable and ability and its ability to be agile is at the highest point possible.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Thank you, Scott.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
Obviously, I think people that listen regularly know I follow healthcare the closest, and healthcare's got a lot of headwinds between Medicaid changes and other things that might impact the healthcare world, especially in the services sector. I think there's a lot of headwinds in that respect. I think a lot of us are still thinking at some point, big deals have to happen.
Becker Private Equity & Business Podcast
Weathering the Private Equity Slowdown: Insights from Rick Kes of RSM 5-5-25
You mentioned this deal today with Skechers and other deals. I think with the amount of capital that's available to be spent. And then, you know, the hold period that some of the investments are at, you know, in terms of what happened in, you know, 19 and 20 and 21, you know, with the deal flow volumes that we saw then, a lot of those kind of are at the hold period end.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
And I think about healthcare, obviously a lot of supplies and goods are bought from companies that may have acquired those goods from China or Mexico or Canada. So we are talking to our clients a little bit about tariffs. I mean, it's not like the number one issue on many of our clients' minds. But I do think
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
just like anything, more uncertainty in the market is probably not good for deal-making activity, except for if you can you know, perhaps take the uncertainty and kind of say, well, maybe in the private market, maybe in more domestic-focused services, you know, the tariff exposure isn't as strong, so maybe it isn't as, you know, pervasive to the overall deal market thesis kind of consideration.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
So, you know, it's hard to know for sure, but in my mind, you know, healthcare is somewhat insulated from some of that tariff issues, although, you know, obviously,
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
There are plenty of things that they're buying that are ultimately going to be potentially subject to a tariff, but it isn't like 90% of their supply chain is coming from China or something like that, that they're going to have this outsized impact. But again, uncertainty is typically not... all that well received by investors kind of in any sector.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
So I would think it will at least put a pause in some people's mind, whether it keeps them from doing a deal or not as yet to be seen, but certainly not exactly accretive to the overall process, I wouldn't think.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
Oh, certainly. You know, kind of going back to the week being exciting. You know, I woke up to, you know, an email from our firm related to the potential pause, well, the announced pause, and then later the rescinding of that pause of federal funding. And
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
Immediately, our clients started calling related to Medicaid, in particular, other government-funded things like subsidies and other things like that. So, yes, I do think this past week, whether it's the tariffs or the federal funding pause or some of the other things that have continued to be somewhat newsworthy have continued to, I'd say, shake the overall healthcare ecosystem a bit.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
Now, some of those things have quickly changed or quickly subsided, but some of them still exist. And I think then now, even with the rescinding of that federal funds announcement, Even with that, I think there is now this heightened level of uncertainty of, well, could that happen again? Or could the overall tension there cause issues in the future?
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
And obviously, it's just probably not all that great news for many of those in the healthcare industry to cause more uncertainty than less. And I do think you're right on the inflationary perspective. Our economists put out a video yesterday about the price of guacamole. You know, avocados are getting kind of a lot of news related to the increase with the tariffs.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
You kind of extrapolate that to other goods and services purchased from Mexico, Canada, China. Obviously, that's just going to cause inflation potentially. And if that inflation comes through, you know, the interest rate environment obviously is going to have kind of an impact as well.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
You know, it's funny. I am allowed to make a prediction, but my children are 13, 11, and 6, and they're all asking me the same question, and I told them, you know, I don't know whether you like Pat Mahomes or not. I just don't know how you vote against him or how you bet against him. He seems to find a way to win, whether you believe the press and some of that is because of the refs and all that.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
Who knows? But I would have a hard time betting against him. But on the other hand, Saquon Barkley seems to get the ball and score a lot. So I guess you kind of have two players that really probably – Depending on who has the better game, I bet whoever has the better game out of those two people, that's the team that's going to win, in my opinion. It comes down to those two individuals.
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
Yeah, you know, this week has been kind of another crazy week, I'd say, you know, in terms of just things that we have our eye on, you know, and, you know, kind of jokingly, you know, the most exciting part to me was the Luka Doncic trade last Saturday. That kind of shocked me for sure. But, you know, the terrorists obviously receiving a ton of headlines and
Becker Private Equity & Business Podcast
Tariffs, Private Equity, and Market Uncertainty with Rick Kes of RSM 2-3-25
I'd say our economists that work within RSM are a little industry agnostic and things of that nature. They're very in-depth in their research and analysis on the impact of tariffs. When I think of it from an industry perspective, it definitely is going to have different impacts to different industries, as one would expect. obviously my industry of choice tends to be healthcare.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
Maybe not so much in areas where you have really highly skilled professionals. As you know, Chanel, and obviously Scott knows this, that I follow healthcare the closest. And I think some of the job displacement there, whether it be nursing or nursing,
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
know physicians or other you know highly skilled individuals those problems still sort of persist but outside of the you know highly skilled environment you know you're starting to see a little bit of easing on the jobs front interest rates obviously still elevated beyond a point of that where they were you know in the past and especially during the zero interest rate environment that we kind of got to see through you know most of the post-pandemic period you know so that is obviously a drag on kind of deal flow and activity
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
And, you know, really uncertain in terms of where that might go over the next, you know, six to 12 to 18 months. But doesn't seem like a lot of change in the near future there. You know, when it comes to inflation, I think there's been some news of late that inflation may be cooling a bit again. And, you know, obviously that's good news in the overall perspective, you know, as we manage inflation.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
Yeah, well, thanks, Chanel. Appreciate being on the call, as you know. I'm a partner at RSM, and at RSM we focus on the middle market, which private equity tends to invest heavily in. A large percentage of our work as a firm is somehow related to private equity groups as well as their portfolio companies.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
operating expense and other things that obviously hit, you know, kind of EBITDA, which obviously drives valuations and all those types of important metrics for our private equity backed companies. And now we're entering kind of a new era of things to kind of monitor. And that's obviously the global trade conversation around tariffs and other things of that nature.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
And I think with all those things, there's good and bad that come out in the news cycle almost every day on all four of those topics. But most of our clients continue to be a little bit uncertain in terms of what the next six to 12 months looks like and whether or not they'll be able to execute on any of their growth strategies other than their own organic growth.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
Those types of opportunities still exist. A lot of our clients are very, very focused on trying to do as much as they can within the four walls of their business without having to do an acquisition or anything of that nature to necessarily grow.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
But obviously, most of our private equity companies have seen success in the past by buying other companies, putting them into a platform, and then really spinning up kind of a larger platform for the next turn of that transaction cycle. So
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
I think although there is opportunity to really focus inward and really optimize and manage what we can manage within the four walls of our company, we're also really optimistic that over the next six or 12 months, some of those other economic factors could probably change a bit. Interest rates probably being the one that would have the greatest impact to our deal flow of our clients.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
But also the uncertainty related to the global economic importance. I think those things could really, as we continue to kind of mature through those cycles, understand how they impact our businesses and really
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
hopefully enable the opportunity for inorganic growth through M&A, which will obviously fuel the private equity community at large to really be able to kind of execute on some of the growth strategies that they've had.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
So again, that kind of gives you a little bit of how we think about things from like kind of a blocking and tackling perspectives, the areas that we focus on the most and kind of how we kind of develop our data forward kind of perspectives around those four areas using really a kind of an economics view of the business cycle.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
Thank you.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
I think a lot of our corporate infrastructure is really designed to try to identify trends and opportunities that we're seeing within the private equity ecosystem. You know, I think we think about things kind of from, I'd say, starting at the highest level from an economist or economics perspective.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
And, you know, when I talk to our economist team, their focuses tend to be kind of heavily square on jobs, inflation, interest rates, and now, you know, really global impacts related to tariffs and things of that nature. You know, so when I think about those things for our clients, you know, I think when we've had these calls, I think over the last few years, we've been doing this podcast.
Becker Private Equity & Business Podcast
Economic Trends and Private Equity Insights with Rick Kes of RSM 6-2-25
And for many, many parts of those years, the jobs environment was probably the toughest part of the conversation for many of our clients was just really finding the talent that they needed to grow and to execute on their strategies. And I think for many of our clients, the talent part of the problem has sort of maybe became less of an acute issue.