“The exit environment overall is governed by both cyclical and secular factors. Cyclical factors get a lot of airtime. Often mentioned are supportive macro, LP allocations right-sizing, and “animal spirits”. But the incentives facing sponsors get a vote. And sponsors today seeking to maximize their probability of survival face an environment that incentivizes retaining assets, lengthening their liabilities, and avoiding replacement/origination costs. This is the New Exit Game.”
