Deal Monitor
Q2 2026 | Market Wrap
The recovery that took hold late last year has carried into 2026, but in a narrow, top-heavy way. Global M&A is on pace for its strongest year since 2021, yet nearly half of all deal value now comes from megadeals above $5 billion, many tied to the race to build out highfalutin technology (i.e., artificial intelligence). Strip those giants out, and underlying activity is flat to lower, with deal counts falling. This is a K-shaped market: enormous strategic deals at the top, a subdued middle beneath them. The middle (companies with EBITDA of <$10 million) is where we hunt.
The financing backdrop has also turned. After three rate cuts to close out 2025, the Federal Reserve has now held steady for four consecutive meetings. Its June projections turned more hawkish: the median policymaker now expects rates to end the year higher than today, with markets pricing in a possible hike amid inflation reaccelerating from the Middle East energy shock. For buyers who depend on cheap leverage, the arithmetic has gotten harder.
At the same time, the industry is sitting on a record, aging mountain of committed-but-unspent capital: well over $2 trillion globally, with a large and growing share of it more than 2 years old. Limited partners are pressing managers on two fronts at once: to deploy capital and to return cash. That pressure is colliding with a thin supply of genuinely durable businesses. The predictable result is a flight to quality.
Sponsors are paying premium prices for the same narrow set of resilient assets, shortening their diligence, and, by the industry’s own account, loosening their terms to win. Competition for the best assets remains intense, and we expect it to remain so.
This is precisely the environment our model was built for.
Our capital, alongside yours, is permanent. We carry no deployment clock and no pressure to chase a forced schedule. We hold to a fixed margin of safety relative to intrinsic value. That lets us step aside while others overpay for trophies and remain patient for the right business at the right price. When we don’t win a deal, it is almost always by choice.
Q2 2026 | Pipeline Performance
In June, we evaluated 14 new opportunities, advanced 10 into the pipeline, and set aside 4. The quality and fit of what we are seeing has improved.
Over the full quarter, the pipeline tightened rather than swelled: total open and active deals fell from 29 as of March 31st to 25 as of June 30th. That is discipline, not drift.The top of the funnel held firm (Information Gathering, 17 to 18), while the middle stages thinned as opportunities resolved: Checklist Qualification fell from 6 to 3, and Due Diligence from 6 to 4. Some advanced, several were killed against our checklist, and one reached completion in Project Omar.
With that close, we now have two completed investments year-to-date — our second deal of 2026.
NB COLLECTIVE FUND I LLC
NB COLLECTIVE FUND II LLC
Q3 2026 | Looking Ahead
Our sourcing momentum continues, and we expect June’s inflow to feed the back half of the year. Today, most of our attention is on the Information Gathering group and the four opportunities in Due Diligence.
We like the quality of companies in our pipeline today. Most of our opportunity set consists of deals we originated and control, where we partner with strong operators who help evaluate, fund, and ultimately run the business.
In the minority, we work alongside equity partners who set the pace while we support the transaction where we can. If completed, these would resemble our earlier closes, Project Hospice and Project Omar, with The Collective taking a minority position.
We will continue to work tirelessly to find companies that pass our investment checklist, clear our required margin of safety, and, ultimately, underwrite great prospective returns for The Collective.
Stay tuned!