US private equity firms are struggling to attract new capital: Private equity funds raised just $222 billion from investors in the first 9 months of 2026, on track for the weakest year since 2020. This would also mark the 3rd consecutive annual decline. By comparison, the industry attracted $406 billion in full year 2023 and $330 billion last year. Higher rates have made it harder for private equity firms to sell businesses at attractive prices, weakening investment returns and prompting investors to become more reluctant to commit capital to new funds. Smaller firms managing less than $15 billion are facing the most pressure. Private equity has lost its shine in the rapidly evolving macroeconomic backdrop.