Covid rebound: UK dealmakers are making up for lost time, after a Covid induced slowdown. With significant hits felt in travel and hospitality during the pandemic, private equity specialists are maximising the recovery across multiple sectors.

Shrugging off Brexit concerns: Even though Brexit induced changes to regulation and legislation initially worried investors, dealmaking opportunities are rife as European corporates remain attractive. In fact acquisitions of European corporates by UK private equity firms has jumped up by 80%.

Tech remains king: Software and technology companies are high in demand, with investors keen to unleash the potential investment can bring. Which explains why one in three deals last year involved a technology company. This market boomed during the pandemic, as technology became even more integral to business and personal life, and the surge in investment shows no signs of abating.

Ethical focus: With the pandemic highlighting widening inequalities, and environmental reports depicting future doomsday scenarios, it’s no wonder that nearly three quarters of investors (70%) have made ESG a part of their investment policies. The majority, 93%, said they would walk away from an investment opportunity if it posed an ESG concern. Investors are looking for organisations that can bolster their ESG portfolio, understanding both the financial and non-financial benefits it can have in the future.

Pent up demand, high levels of dry powder and robust markets are driving the current boom in private equity deals. But with the ongoing conflict in Ukraine and soaring inflation levels, activity in 2022 year may not surpass last year’s record-breaking figures. However, it’s clear that investment opportunities are still in abundance.

Consultancies are keen to get in on the action, helping private equity firms and investors to source lucrative deals. Advising on everything from growth opportunities and areas of risk to preparations required for IPO and M&A activity. Against a tumultuous global and economic backdrop, investors have to be rigorous with their portfolios. But with a wealth of deals still to be made, private equity opportunities remain plentiful.

Metaverse

PwC and Accenture have recently launched metaverse services, supporting clients in understanding how to maximise virtual opportunities. Despite the concept being around for more than 30 years, “metaverse” seems to be the latest buzzword thanks to heavy investments from Facebook (rebranding to “Meta”), Google and Apple. The metaverse essentially aligns virtual and physical worlds – for example, new employees can conduct onboarding virtually, in an organisation’s metaverse. It’s considered to have evolved recently, particularly driven by the pandemic with individuals conducting personal and professional lives increasingly online.

The metaverse is being used by organisations as an additional way to deepen customer loyalty, engage communities in new ways and grow revenue. Fashion houses have unsurprisingly caught wind of this latest trend, with “Gucci Garden” in the Roblox gaming metaverse attracting 19 million visitors. This renewed interest, and evolution of the metaverse, has other fashion players eyeing up the $176 billion (£135 billion) gaming industry. With such significant opportunities available, it’s no wonder big brands have already heavily invested in the metaverse.

Quantum computing

Despite being in its relevant infancy from a business perspective, quantum computing is a tech trend to watch. With the ability to solve vastly complex business problems, quantum computing combines machine learning, simulation, and enhanced optimisation. It has the capability to transform the way business is conducted, from rerouting supply chains in real time to improving wealth management scenarios in financial services.

Whilst there has been significant investment in quantum computing, with $1.02 billion (£781 million) invested in 2021, it has yet to hit mainstream businesses. Leading some organisations to advise watching developments in 2022, before unleashing capability in 2023 onwards.

Other organisations have already started exploring partnerships with quantum hardware and software developers, to ensure they’re not on the backfoot. And with the potential to provide a trillion more computing power than today’s advanced supercomputers, once the major players have unlocked the full potential of quantum computing – they will have significant competitive advantage.

AI and machine learning

Consultancies have traditionally number crunched, creating solutions from the results provided. But artificial intelligence and machine learning has transformed this process, making it much quicker, providing greater insight and predictions. Whilst this may have been viewed as a way to impress potential and existing clients, it’s become an expectation for many.

Digitally capable clients will already have enabled AI and machine learning across business functions, creating greater transparency. Businesses will expect consultancies to tap into existing data, build upon insights further, find new opportunities for growth and lean on their technological expertise for further innovation. The possibilities for AI and machine learning are seemingly endless, as its ability to be applied to multiple business functions and sectors continues to grow.

Whether these aforementioned technologies are yet to be explored or already in use within businesses, they all need robust strategies in place to maximise benefits and minimise risk. Consultancies can help businesses assess what technology needs developing or implementing now, to expand upon opportunities. But one thing is for sure, business leaders that ignore technology trends do so at their peril. As technology becomes more sophisticated, businesses that haven’t put the relevant provisions in place to explore opportunities risk becoming irrelevant in tomorrow’s market.

Don’t forget homeworking employees

Employees that have been able to maintain working from home opportunities may still relish the set up. However, it’s important to check in with homeworking employees to ensure they aren’t experiencing loneliness and feel part of the team. Out of sight, shouldn’t be out of mind.

Make sure that homeworking employees are still invited to social events and don’t miss out on important work opportunities. Not being physically present in an office, shouldn’t equate to being overlooked.

Whilst working from home can have multiple benefits, it can lead to feelings of isolation and loneliness. Even if employees don’t take you up on the opportunity to participate in social events, it’s the thought that counts. It lets employees know that they are still valued members of the team, even if they’re not regularly in the office.

Make room for charitable activity

It’s well documented that aligning business and social purpose can have a powerful impact on employee engagement and retention rates. The pandemic made many employees re-evaluate what they want from the workplace. With “the great resignation” indicating that they aren’t afraid to change their current employment to get it.

Organisations could look into freeing up time to enable employees to engage in charitable activity – such as initiatives that address elderly loneliness, through care home visits. With an estimated two million older people expected to experience loneliness by 2026, employers can make a significant impact in helping combat the issue.

From supporting local social events aimed at the vulnerable, to allowing flexibility in caring for those struggling – businesses can make a positive impact, that will be valued by employees and communities alike.

It’s not just the elderly that are at higher risk of suffering from loneliness, but young people too. Particularly those that have left education and are vulnerable in deciding their next move. Being born into a digital generation, physical interaction is less common as online communications take precedence – increasing feelings of loneliness.

Businesses and employees can play an important role here too, helping young people to make the leap from education to the workplace and working on youth focused initiatives to tackle loneliness.

Gender divide

As we’ve covered in previous posts, the pandemic unduly impacted women. From taking on increased childcare duties and household chores, to being more likely to lose their job. A significant burden was placed on women during the Covid-19 crisis.

It’s no surprise that women’s mental health worsened as a result, with 45% saying that they “sometimes” or “often” felt lonely – compared to 29% of men.

Whilst social restrictions have eased, the impact on mental health has not. In fact, reports indicate it may be worsening. From individuals experiencing social anxiety (as we “re-learn” how to socialise), to “FOMO” induced burnout (the “Fear Of Missing Out”, leading to exhausting work and social arrangements to catch-up on missed time). It’s clear that the pandemic impact on mental health continues.

The pandemic gave many people a taste of what it’s like to experience loneliness for the very first time. Whilst the easing of lockdown restrictions meant that feelings of loneliness immediately lifted for some, it remains a crippling condition for others.

Employers play a crucial role in tackling loneliness – whether experienced by employees directly, their loved ones, or wider people in the community. It’s important that businesses understand the nuances of loneliness, that it’s not just an issue that affects the elderly, and support employees to make a difference where possible