KPMG Private Markets Pulse
Reshaping investment strategies amid economic uncertainty.
See what's influencing investment priorities amid economic uncertainty and a growing focus on domestic growth.
KPMG US surveyed more than 300 institutional investors, including private equity (PE), asset management (AM), and venture capital (VC) across various industries and sectors in the first quarter of 2025 and then again in the second quarter, to capture changes in investor sentiment around economic growth and deal market outlook, including factors influencing investment decisions both before and after the announcement of new tariffs and the resulting effects.
In a rapidly evolving economic landscape, tariffs are among many considerations that are significantly influencing investment decisions and prompting institutional investors to reassess their priorities as they navigate geopolitical tensions, inflationary pressures and the growing influence of artificial intelligence (AI).
See below for key findings and updated investor sentiments or click here to read more.
Tariffs—both the downstream impacts and mitigation of them—are challenging institutional investors to rethink their investment strategies and risk appetite. While they maintain an optimistic view of long-term growth, in the near-term, their focus has shifted to domestic companies in industries experiencing less uncertainty due to the current market environment.
Tarek Ebeid
KPMG Private Leader & Partner in Charge – Northern California Audit Practice, KPMG US
Key findings:
1
Investors view tariffs as both a near-term challenge and a driver of strategic shifts in investment priorities.
- Investor views are mixed regarding tariffs’ impact on economic growth in the near-term, while longer term (beyond 18 months) there is perceived optimism.
- With 61% of institutional investors acknowledging the high impact of tariffs on investment decisions, there is a notable shift towards domestic companies and sectors less impacted by tariffs
2
Investors are holding out hope for the IPO window to open as capital deployment plans see a slight uptick.
- Despite reduced optimism about near-term economic conditions, investor confidence in IPO activity remains strong, with 68% expecting an increase in activity in the next 18 months.
- Growth equity investments and mergers and acquisitions (M&A) are seen as the most viable exit pathways outside of an IPO, consistent with the findings in our Disruption Decoded report from earlier this year.
3
Investor confidence wanes in the near-term, with interest rate cuts and geopolitical tensions expected to shape economic outlook.
- A 12-point decline in optimism about economic growth in the near-term (in the next 18 months) from January-February to April, is tempered by four in ten investors believing economic uncertainty is limited to the short-term (6 months to a year).
Dive into our survey results, including insights by investor class:
KPMG private markets pulse: Reshaping investment strategies amid economic uncertainty
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