Uncharted No More: Valuation Multiples in the Independent Sponsor Sector

2025 Independent Sponsor Report reveals how independent sponsors are reshaping private equity not only through deal sourcing and capital structures, but also in the valuations at which transactions are being closed. Independent sponsors today are competing head‑to‑head with traditional private equity funds, often paying full multiples for higher‑quality assets. Drawing on insights from more than 170 professionals active in the sector, the Report examines how valuation multiples have shifted over the past year, revealing both the persistence of mid‑market ranges and the growing prevalence of transactions priced at premium levels.

Valuation Multiples

Within the past year, the majority of IS respondents (54%) have closed transactions at multiples of 4x to under 6x EBITDA. In all years of our Report, this has been the most common multiple range for transactions closed by IS respondents, though this statistic is down from last year when 64% of respondents closed transactions at 4x to under 6x EBITDA.

Seventeen percent of respondents have typically closed transactions at less than 4x (up from 12% last year), and 37% of respondents have closed transactions at multiples of 6x to under 8x, which is up from 31% last year. Multiples of 8x or more remained relatively steady since last year.

“I’m surprised that there were more transactions closed at 6x to 8x in this year’s survey [which relied on data for transactions closed in 2024] versus last year’s [which relied on data from transactions closed in 2023],” noted Richard Baum, managing partner, Consumer Growth Partners. “2024 was not a particularly great year for private equity, and I would have expected multiples to be lower than those for 2023 transactions.”

“It could be that the transactions at 6x to 8x multiples were with more traditional capital providers, or it could be transactions where the independent sponsors were finding themselves in competition with traditional private equity funds, and thus they needed to bid more,” Richard Baum explained. “However, the more you bid, the harder it is to get a satisfactory return when you exit.”

“We’re seeing an increasing trend toward higher-quality deals priced at full multiples, especially in mid-2025,” noted Tarrus Richardson, founder and CEO of IMB Partners. “The market has been challenging in the past 18 to 24 months,” he acknowledged. “It opened up in Q1 and Q2 with a slight uptick as many believed interest rates were going down, but by Q3, the election and post-election developments cooled sentiment, and deal volume declined as broader macro forces weighed on buyers and sellers.”

“Deals that are getting done are higher quality and clearing at full multiples: assets that used to trade at 4x to 6x now change hands at 6x to 9x,” Tarrus Richardson added. “These transactions are harder to close because many sellers still assume independent sponsors only chase off-market bargains,” he explained. “That said, I think there are opportunities for skilled independent sponsors who can buy a high-quality business at a fair price and then unlock value through targeted operational improvements and organic growth.”