Fragmented Industries Ripe for Consolidation in 2026: The Next PE Rollup Plays

PE consolidation moves through industries in waves, with predictable patterns. The wave that hit HVAC in 2018-2022 (Apex, Wrench Group, Sila, Authority Brands forming) is now hitting roofing in 2024-2026 (Tecta America, CentiMark, Coastal Roofing). The next waves — in 2026-2028 — will hit electrical contracting, IT MSP, accounting firms, marketing agencies, funeral services, eldercare, residential cleaning, masonry, paint contractors, and several other industries with the right combination of fragmentation, recurring revenue, and demographic tailwinds. Sellers in these industries face a timing decision: sell now in a thin buyer pool, or wait 12-24 months for platform formation to expand multiples.

This guide identifies the industries most likely to see PE consolidation activity in 2026-2028. We’ll walk through 10 fragmented industries with strong consolidation thesis, name the early-mover platforms (where they exist), explain the underlying drivers, and provide realistic timing expectations for when each industry’s rollup will mature. The goal: by the end of this article, you should understand whether your industry is at pre-cycle, early-cycle, or mid-cycle consolidation stage — and what that means for your sale timing decisions.

Our framework comes from working alongside 76+ active U.S. lower middle market buyers and tracking platform formation activity across 40+ industry verticals. We’re a buy-side partner. The buyers pay us when a deal closes — not the seller. That includes emerging consolidators in IT MSP, accounting firms, marketing agencies, eldercare, and trades adjacent to home services consolidation. We see platform formation announcements weekly, know which sponsors are actively underwriting new platforms in which industries, and can identify which sellers are well-positioned for early-mover platforms versus better off waiting for the consolidation wave to mature.

One framing note before we dig in. ‘Ripe for consolidation’ is a forward-looking thesis — meaning the consolidation hasn’t fully arrived yet. Sellers in pre-cycle industries today face thinner buyer pools (fewer competitive bidders) and lower multiples than they will in 24-48 months. The trade-off: sell now and accept the discount, or wait 12-24 months and benefit from platform formation. There’s no universal right answer — it depends on the seller’s personal timeline, the industry’s growth trajectory, and the seller’s risk tolerance for waiting through a market that may or may not develop as predicted. The signals below help anchor that decision.

“The most expensive timing mistake in M&A is selling at the bottom of a multiple expansion cycle. Sellers in pre-consolidation industries today face thinner buyer pools and lower multiples than they will in 24-48 months when platforms form. The opposite mistake is waiting too long — selling at the peak of a consolidation cycle when platforms are mature, multiples have peaked, and integration risk is rising. The middle window — selling 12-24 months after a platform forms and multiples have expanded but before late-cycle compression — is the timing sweet spot. Identifying which industries are at which cycle stage is what experienced buy-side partners do all day.”

Key Takeaways

• Three signals identify a fragmented industry as ripe for consolidation: 80%+ independent ownership, recurring-revenue or contracted-relationship characteristics, and M&A precedent in adjacent verticals.
• Top fragmented industries 2026: funeral services, medical practices beyond dental/vet (primary care, specialty), eldercare, IT MSP, marketing agencies, accounting firms, electrical contracting, masonry, paint contractors, residential cleaning.
• Funeral services: 19,000+ US operators, SCI and Carriage Services own under 15% combined. Demographic tailwind. Multiples 5-8x EBITDA. Slow-moving but predictable consolidation over 5-10 years.
• IT MSP: $300B global industry, 50,000+ US operators. ConvergeOne (CVC), Evergreen Services Group, New Era Technology, Logically (Riverside) leading. Multiples 6-9x EBITDA. Mid-stage rollup in 2026.
• Accounting firms: PE entered the space 2021-2024 (Cherry Bekaert, Aprio, Sax LLP, Baker Tilly capital partner deals). Multiples 5-7x EBITDA. Early-stage rollup with 24-36 months of multiple expansion likely.
• Trades adjacent to HVAC consolidation (electrical, masonry, paint, residential cleaning) are 24-48 months behind HVAC rollup. Sellers can wait for platform formation or sell now to early-mover acquirers.

How to identify a fragmented industry ripe for consolidation

PE consolidation moves through industries in predictable cycles, and the early-cycle indicators are knowable. Three primary signals identify an industry as ripe for the next wave of consolidation. First: fragmentation level (80%+ independent ownership, with no single operator above 5% market share). Second: recurring revenue or contracted relationships that survive ownership change (subscription, retainer, contract maintenance, repeat-purchase customer behavior). Third: M&A precedent in adjacent verticals demonstrating the consolidation thesis works (e.g., HVAC consolidation precedent supports the case for electrical and roofing rollups).

Secondary signals confirm the timing. Recent platform formation announcements (a sponsor announcing the formation of an industry-specific platform with $50M+ initial equity is the strongest signal). Industry-trade-press coverage of consolidation activity (when trade press starts running articles about ‘[your industry] rollup’ and ‘PE entering [your industry],’ the wave is forming). Increased SBIC and BDC lending activity in the vertical. Multiple PE-backed lower-middle-market platforms emerging within 12-18 months of each other in the same industry — this signals real wave formation.

Tailwind signals support durability of the consolidation. Demographic tailwinds (aging population for healthcare and eldercare, pet humanization for veterinary, household formation for residential services). Regulatory tailwinds (HVAC refrigerant transitions, EV charging buildout for electrical contracting, ADA compliance investments for facilities services). Technology adoption tailwinds (cloud migration for IT MSP, e-commerce shipping volume for fulfillment services, automation for industrial services). Industries with strong tailwinds attract PE consolidation faster and command higher multiples through the cycle.

Negative signals: industries unlikely to consolidate cleanly. Industries lacking recurring revenue (project-based custom manufacturing, owner-personality-dependent consultancies, traditional retail). Industries with structural decline (legacy print media, traditional taxi service, generic retail). Industries with regulatory complexity that prevents scale (small-scale law firms with state-specific bar admission, small-scale architecture practices with state-specific licensing). These industries can still see acquisition activity from individual buyers and search funders but are unlikely to see PE platform formation.

Funeral services: the predictable long-cycle consolidation

Funeral services is the most predictable long-cycle consolidation thesis in 2026. The US has 19,000+ funeral homes operating across 50 states, the vast majority of which are family-owned independent operations. Industry concentration is low: SCI (Service Corporation International, NYSE: SCI) is the largest with roughly 1,500 locations, and Carriage Services (NYSE: CSV) operates 170+ locations. Combined, the public consolidators own less than 15% of US funeral home revenue. The recurring-revenue thesis is strong (preneed contracts representing future services), demographic tailwinds are unambiguous (aging population), and the operational thesis (procurement, technology, marketing scale) is proven.

Why PE consolidation in funeral services moves slowly. Three factors. First, funeral services have strong family-business legacy — many independent operators are 3rd or 4th generation with strong community ties that don’t commoditize easily. Second, regulatory complexity (state-specific funeral director licensing, embalming requirements, prepaid trust regulations) creates onboarding friction for consolidators. Third, customer acquisition is heavily community-relationship-driven, making top-down marketing scale less effective than in residential services. The result: PE platform formation in funeral services lags HVAC consolidation by 5-10 years.

Active 2026 funeral consolidators. Service Corporation International (SCI, NYSE: SCI) is the largest, acquiring 30-50 funeral homes per year through its public-company M&A program. Carriage Services (NYSE: CSV) is active at smaller scale. Foundation Partners Group (Access Industries) is a PE-backed consolidator pursuing high-end independent funeral homes. NorthStar Memorial Group (private) operates regional consolidation. Several smaller PE-backed regional platforms have emerged in 2024-2026.

Funeral services multiples and timing. Multiples 5-8x EBITDA for $1M+ EBITDA funeral home operations with strong preneed contract revenue. Sub-$1M operations: 3-5x SDE for SBA buyers and individual operators. Multiples likely to expand 1-2x over the next 5-10 years as PE platforms form and competition for high-end independent funeral homes intensifies. Sellers within striking distance of $1M EBITDA should consider whether 24-36 months of growth into platform threshold pays back through wider buyer pool.

Medical practices beyond dental and veterinary: the next healthcare consolidation

Beyond dental DSOs and veterinary platforms, medical practice consolidation in 2026 is uneven across specialties. Some specialties (dermatology, ophthalmology, behavioral health, gastroenterology, orthopedics) have active platforms and mature multiples. Others (primary care, pediatrics, internal medicine, OB/GYN, plastic surgery, allergy/asthma, ENT, urology, podiatry, cardiology, pulmonology) have varying levels of consolidation maturity, with several still in pre-cycle or early-cycle stage.

Pre-cycle and early-cycle specialty consolidation in 2026. Allergy/asthma: Allergy & Asthma Network of America, Allergy Partners (PE-backed), and several regional platforms in early-cycle. ENT: ENT Specialty Partners, US ENT, and several regional platforms in early-cycle. Plastic surgery: largely pre-cycle with significant private operations and emerging platforms. Pediatrics: largely pre-cycle except for specific subspecialty consolidation. OB/GYN: mid-cycle with Axia Women’s Health (Partners Group), Unified Women’s Healthcare (Altas Partners), Women’s Health USA. Pulmonology: pre-cycle with very limited PE activity. Podiatry: early-cycle with US Foot & Ankle Specialists and several regional platforms. Cardiology: largely employed-physician model dominated by health systems; limited PE consolidation.

Primary care: hybrid consolidation models. Primary care consolidation runs along three distinct models. First, value-based care platforms (Oak Street Health acquired by CVS, ChenMed, Iora Health acquired by One Medical/Amazon) focused on Medicare Advantage and dual-eligible populations. Second, traditional primary care DSO-style consolidators (Privia Health NASDAQ: PRVA, Aledade, Privia Medical Group). Third, employer-health-focused operators. Multiples vary from 6-9x EBITDA for clinic-based primary care to 8-12x for capitated value-based platforms with population health capabilities.

Why specialty medical practice consolidation is industry-by-industry. Each medical specialty has different economics: payer mix (commercial PPO heavy versus Medicare/Medicaid), procedure mix (office-based versus surgical), referral dynamics (primary care referral dependent versus self-referred), and capital intensity (low for primary care, high for surgical specialties). PE consolidators underwrite each specialty differently, leading to staggered consolidation timing across the dozens of medical specialties. Sellers should look for platform formation activity in their specific specialty rather than assuming ‘medical’ is one consolidation cycle.

Eldercare: home health, assisted living, and senior services consolidation

Eldercare consolidation in 2026 spans home health, hospice, assisted living, memory care, and senior services. Demographic tailwinds are unambiguous: the US population over 65 will grow from 56M in 2020 to 73M+ by 2030. Medicare beneficiary count is rising 10K+ per day. The eldercare ecosystem — home health agencies, hospice operators, assisted living facilities, memory care facilities, adult day care, and personal care services — is highly fragmented with thousands of independent operators alongside several scaled consolidators.

Home health and hospice consolidation. Home health is the most consolidated eldercare subcategory. Encompass Health (NYSE: EHC), LHC Group (acquired by Optum/UnitedHealth 2023, NASDAQ: LHCG), Amedisys (NASDAQ: AMED), Addus HomeCare (NASDAQ: ADUS), and BAYADA Home Health Care anchor the public/PE consolidator layer. Multiples 8-12x EBITDA driven by Medicare reimbursement complexity favoring scale. Hospice is similarly consolidated with VITAS Healthcare (Chemed Corp NYSE: CHE), Compassus (Towerbrook), and Bristol Hospice (Webster Capital) leading. Multiples 9-13x EBITDA.

Assisted living and memory care consolidation. Less consolidated than home health/hospice. Brookdale Senior Living (NYSE: BKD) is the largest US senior living operator. Sunrise Senior Living, Atria Senior Living, Holiday Retirement, and dozens of regional operators compete. Memory care has higher multiples than assisted living due to specialized services and higher per-resident revenue. Multiples 7-10x EBITDA for assisted living, 9-12x for memory care. PE platforms include Welltower (NYSE: WELL) and Ventas (NYSE: VTR) on the REIT side, plus operating-company PE platforms.

Personal care services and adult day care. Personal care services (non-medical home care for activities of daily living) and adult day care are early-cycle consolidation plays. Several PE-backed platforms have emerged in 2022-2026 to consolidate independent personal care agencies. Multiples 5-7x EBITDA driven by Medicaid waiver program reimbursement and moderate recurring revenue characteristics. The rollup is mid-cycle in coastal states with strong Medicaid waiver programs (California, New York, Massachusetts, Pennsylvania) and earlier-cycle in Sun Belt states.

IT MSP (managed services providers): the mid-stage tech-services rollup

Managed IT services providers (MSPs) are in active mid-stage consolidation as of 2026. The MSP industry is roughly $300B globally with 50,000+ US operators ranging from small one-person shops to large multi-state platforms. The recurring-revenue thesis is exceptional: 60-75% of revenue is contracted MRR (monthly recurring revenue) from technology management agreements. Customer retention runs 90%+. The tech-skill-driven labor model creates clear scale economies through technician training, certification, and centralized service desk operations.

Active IT MSP consolidators in 2026. ConvergeOne (CVC Capital Partners) is the largest US MSP at $1.5B+ revenue. New Era Technology operates across multiple specialty areas (audiovisual, security, networking, cloud). Logically (Riverside Company) is a fast-growing PE-backed MSP. All Covered (Konica Minolta) operates as part of Konica Minolta’s US technology services group. Evergreen Services Group (Service Express) is a fast-growing PE-backed MSP consolidator. Service Express, ECI Software Solutions, and dozens of regional PE-backed platforms compete actively for sub-$10M EBITDA add-ons.

IT MSP multiples and structures. Multiples 6-9x EBITDA for $1M+ EBITDA MSPs with strong MRR base (60%+ of revenue from monthly recurring contracts). Sub-$1M EBITDA MSPs: 4-6x EBITDA driven by SBA capital structure constraints. Specialty MSPs (vertical-specific, security-focused, cloud-focused) command premium multiples (8-11x) when their specialty creates a moat. Cybersecurity MSSP (managed security services providers) command higher multiples than general MSPs due to the structural growth in cybersecurity spending.

What MSP sellers should know about positioning. MRR percentage above 60% is the threshold that most PE consolidators require for premium multiples. Customer retention metrics (gross logo retention, net dollar retention) are scrutinized in diligence. Recurring vs project revenue split is a focus area. Owner-replaceable operations (with a managed service desk team that doesn’t depend on the owner’s personal customer relationships) command significantly higher multiples than owner-dependent operations. The MSP rollup is mid-cycle in 2026; multiples likely to compress modestly over 24-36 months as the wave matures, suggesting near-term selling for sellers above $1M EBITDA may be timing-optimal.

Marketing agencies: early-cycle consolidation with retainer-based premium

Marketing agencies are in early-cycle PE consolidation in 2026. The US marketing services industry is roughly $400B annually across digital marketing, performance marketing, content marketing, public relations, branding, and traditional advertising. Concentration is low: the top 5 holding companies (WPP, Omnicom, Publicis, IPG, Dentsu) operate primarily at the enterprise scale, leaving the LMM marketing services market highly fragmented across thousands of independent agencies. PE platforms entering the space target retainer-based agencies with 60%+ recurring monthly fee revenue.

Active marketing agency consolidators in 2026. Stagwell Inc. (NASDAQ: STGW), formed through the Stagwell-MDC Partners merger 2021, is the largest publicly-traded marketing services consolidator. PE-backed platforms include Power Digital Marketing, Tinuiti (recapitalized 2022 with New Mountain Capital), Dept (Carlyle), and Hawke Media (PE-backed). Specialty platforms include Wpromote (digital marketing), R/GA (private), and dozens of regional PE-backed digital agencies. Performance-marketing platforms (advertising-results-focused) command premium multiples due to outcome-based revenue characteristics.

Marketing agency multiples and structures. Performance marketing agencies with retainer-based recurring revenue: 5-8x EBITDA. Digital marketing agencies with mixed retainer/project revenue: 4-6x EBITDA. Project-based creative agencies: 3-5x EBITDA. Public relations agencies with retainer-heavy structure: 5-7x EBITDA. The premium is driven by recurring revenue percentage and customer retention; agencies with 70%+ retainer revenue and 90%+ retention command top-of-range multiples in their category.

What marketing agency sellers should know. Marketing agency consolidation is highly seller-personality-dependent. Founder-led agencies often have strong customer relationships that don’t transfer cleanly. PE consolidators discount heavily for founder-dependency and structure transactions with 3-5 year founder retention agreements plus rollover equity to align incentives. Agencies with strong second-tier leadership (managing directors, group account directors with their own client relationships) trade at premium multiples. The rollup is early-cycle, suggesting 24-48 months of platform formation activity ahead with multiple expansion potential.

Accounting firms: PE entry creates the next professional services rollup

Accounting firms entered active PE consolidation in 2021-2024 with the regulatory pathway opening for non-CPA ownership of accounting firms. The Big Four (Deloitte, PwC, EY, KPMG) operate at the enterprise scale, but the LMM accounting market — mid-size regional firms, specialty firms, advisory-heavy firms — is highly fragmented across 25,000+ US accounting firms. The recurring-revenue thesis is moderate: tax preparation has annual recurring patterns; audit work is annual recurring; CFO services and advisory have monthly recurring or project structures. PE entry has been accelerating since 2021.

Active accounting firm consolidators in 2026. Cherry Bekaert (Parthenon Capital), Aprio (Charlesbank Capital Partners), Sax LLP (recapitalized with Lugano Diamonds’ principal Pequot Lane Partners), and Marcum (Cinven equity investment 2024) lead PE-backed accounting firm consolidation. Baker Tilly (HYL/Hellman & Friedman investment), Citrin Cooperman, EisnerAmper (TowerBrook), CBIZ Inc. (NYSE: CBZ public), and BDO USA have all received PE capital or active partnership investment. EY split tax-only operations into a separate PE-considered entity. The regulatory pathway (state-by-state non-CPA ownership rules) is being navigated through alternative practice structures (APS) where audit and non-audit operations are separated.

Accounting firm multiples and structures. Multiples 5-7x EBITDA for $2M+ EBITDA accounting firms with strong recurring tax/audit/CFO services revenue. Smaller firms: 3-5x SDE for SBA buyers. Specialty firms (forensic accounting, transaction advisory, ESG/sustainability advisory) command premium multiples due to specialty pricing power. Cash at close: 60-75% (lower than other industries due to professional partnership rollover structures). Rollover equity / partnership interests: 25-40% — high relative to other industries because partner alignment is essential. Performance earnout: 15-25% tied to client retention.

What accounting firm sellers should know. Accounting firm consolidation has unique structural elements. Partnership rollover (partners stay involved 5-10 years post-close) is standard rather than optional. Client retention metrics are diligenced extensively (the entire value of the firm is in the client book and partner relationships). Cultural fit between the selling firm and acquiring platform is critical — accounting firms have unusually strong cultures that can derail integration. Multi-partner firms typically transact more cleanly than founder-dominated firms. The rollup is early-stage with 24-36 months of multiple expansion likely as more PE capital enters the space.

Electrical contracting: 24-36 months behind HVAC rollup

Electrical contracting is the early-cycle adjacent-trade play in 2026. The US electrical contracting industry is roughly $200B+ in annual revenue with 70,000+ independent contractors. The largest 5 PE-backed platforms collectively own less than 3% of US electrical contracting revenue, making this the most fragmented major US trade. The EV charging buildout, residential solar installation, smart-home wiring, and commercial electrification trends create a multi-decade demand tailwind that PE has just started to capitalize on.

Active electrical contracting consolidators in 2026. Sila Services (Goldman Sachs), Apex Service Partners (Alpine Investors), and Authority Brands (Roark Capital, through Mister Sparky franchise brand) operate cross-trade platforms with electrical alongside HVAC and plumbing. Yellow Brick Road (Trivest Partners) is an electrical-focused platform. Premier Service Partners is an early-stage electrical contracting platform. Several regional PE-backed platforms have emerged in 2023-2026. Wrench Group operates Mister Sparky as part of its multi-trade portfolio.

Electrical contracting multiples and timing. Multiples 4-6x EBITDA for $1M+ EBITDA electrical contractors today. Sub-$1M operations: 3-5x SDE for SBA buyers. Multiples likely to expand 1-2x over the next 24-36 months as PE platform formation accelerates and competition for add-ons increases. Commercial electrical contractors with established service contracts and Industrial / institutional customer relationships command premium multiples (5.5-7x EBITDA) versus residential-only operators (4-5.5x). The rollup is 24-36 months behind HVAC consolidation, suggesting near-term selling captures less of the multiple expansion than waiting 12-18 months for platform formation to mature.

License-transfer mechanics in electrical contracting. Most US states require master electrician licensing to operate as a contractor. The license must transfer or the buyer must employ a licensed master electrician as a qualifying individual. This is rarely a deal-killer but it’s a diligence focus area and creates timing constraints. Sellers in license-restrictive states (California, New York, Massachusetts, several others) should clarify license-transfer mechanics in early diligence. EV charging certification (UL, NEC compliance) is a separate licensing layer becoming more important as EV adoption accelerates.

Masonry, paint, and residential cleaning: pre-cycle trade consolidation

Masonry contracting, paint contracting, and residential cleaning are pre-cycle or very-early-cycle consolidation plays in 2026. Each industry is highly fragmented with thousands of independent operators, has some recurring or repeat-customer revenue characteristics, and may benefit from adjacent-trade consolidation precedent. PE platform formation in these industries is limited as of 2026, but the fundamentals support eventual consolidation. Sellers in these industries today face thinner buyer pools but may benefit from waiting for platform formation.

Masonry and concrete contracting. US masonry contracting is roughly $30B in revenue across residential, commercial, and infrastructure work. Concrete contracting (foundations, slabs, decorative concrete) overlaps significantly. Industry concentration is very low — no major PE-backed consolidator exists at LMM scale as of 2026. Multiples 3-5x EBITDA today for established commercial-focused operators with repeat customer relationships. Sub-$1M operations: 2.5-4x SDE. The pre-cycle nature suggests 36-60 months before active platform formation, with significant multiple expansion potential as the rollup arrives.

Paint contracting (residential and commercial). US paint contracting industry is roughly $40B in revenue. Residential repaint work has limited recurring revenue (homeowners repaint every 7-12 years), but commercial paint contracting (apartment complexes, office buildings, hospitals, schools) often has multi-year contracts and repeat-customer relationships. CertaPro Painters (franchised, owned by FirstService Brands) is the largest franchised residential paint operator. Several regional PE-backed paint platforms have emerged in 2023-2026 but the rollup is very early-cycle. Multiples 3-5x EBITDA for $1M+ EBITDA commercial paint contractors; lower for project-based residential operators.

Residential cleaning services. US residential cleaning industry is roughly $15B in revenue. Subscription-style residential cleaning (recurring weekly, biweekly, or monthly cleaning service contracts) has strong recurring-revenue characteristics. Merry Maids (ServiceMaster, now Roark Capital) and The Cleaning Authority (Authority Brands) anchor the franchised residential cleaning landscape. Several PE-backed independent residential cleaning platforms have emerged in 2022-2026. Multiples 4-6x EBITDA for subscription-mix residential cleaning with 70%+ recurring revenue. Project-based cleaning (move-out cleaning, deep cleaning) trades lower at 2.5-4x. Early-cycle rollup with 24-36 months of platform formation activity ahead.

Commercial cleaning and facilities services: mid-stage consolidation

Commercial cleaning and facilities services are in mid-stage PE consolidation as of 2026. The US commercial cleaning industry is roughly $80B in revenue across janitorial, building services, and integrated facilities management. Recurring revenue characteristics are strong: most commercial cleaning contracts run 12-36 months with high renewal rates. The thesis: consolidate fragmented regional operators into multi-state platforms with centralized procurement, technology, training, and customer service operations.

Active commercial cleaning consolidators in 2026. ABM Industries (NYSE: ABM) is the largest publicly-traded US facilities services operator. Aramark (NYSE: ARMK) operates facilities services as part of its broader services portfolio. ISS Facility Services (private, formerly NASDAQ-listed) is a global facilities services operator with significant US business. PE-backed platforms include Sentinel Capital’s Aim Janitorial, Fortis Building Solutions, KBS Building Services, and several regional PE-backed cleaning/facilities aggregators. Specialty platforms include OctoClean (specialty cleaning), Servpro (franchised disaster cleanup, owned by Blackstone since 2019), and dozens of regional operators.

Commercial cleaning multiples and structures. Multiples 5-7x EBITDA for $1M+ EBITDA commercial cleaning operators with strong contract retention. Sub-$1M operations: 3.5-5x SDE for SBA buyers. Specialty cleaning (medical-grade, food service, industrial) commands premium multiples (6-8x) due to specialized certifications and pricing power. Disaster restoration (water damage, fire damage, mold remediation) trades at 6-8x EBITDA driven by insurance carrier relationships.

Why facilities services is mid-cycle rather than late-cycle. Despite long history of consolidation (ABM, ISS have been consolidating for decades), the LMM facilities services market remains highly fragmented because regional service quality and customer-relationship intimacy create real competitive moats against scale. PE platforms can grow rapidly through acquisitions but face integration challenges with maintaining service quality across geographies. The rollup is mid-cycle with multiple expansion likely capped at current levels — sellers should not expect significant near-term multiple expansion in this category.

Other forward-looking consolidation plays: insurance brokerage, specialty distribution, fitness, and others

Several other industries are in various stages of PE consolidation in 2026 and worth tracking. Insurance brokerage is late-cycle but still highly active (AssuredPartners, HUB International, Acrisure, Alera Group, Hilb Group, Brown & Brown NYSE: BRO close 200+ deals/year combined). Specialty distribution (Beacon Roofing Supply NASDAQ: BECN, GMS Inc NYSE: GMS, BlueLinx NYSE: BXC, dozens of category-specific platforms). Fitness studios and franchised fitness (Xponential Fitness NYSE: XPOF, Self Esteem Brands acquired by Roark Capital, Crunch Fitness platforms). Specialty manufacturing (Hearthside Food Solutions, contract packaging, private label food). Each has its own consolidation dynamics.

Insurance brokerage: late-cycle but still highly active. Despite 30+ years of consolidation, the US insurance brokerage market remains highly fragmented at the LMM level. AssuredPartners (GTCR), HUB International (Hellman & Friedman, Altas Partners), Acrisure (multiple PE), Alera Group (Genstar), Hilb Group (Carlyle), and Brown & Brown (NYSE: BRO public) have collectively closed 200+ acquisitions per year for the past 5+ years. Multiples 8-11x EBITDA for property & casualty agencies, 10-14x for specialty employee benefits brokerage. Late-cycle but multiples remain elevated due to ongoing competition among scaled aggregators.

Specialty distribution. PE-backed specialty distribution platforms span building products (Beacon Roofing Supply NASDAQ: BECN, GMS Inc NYSE: GMS, BlueLinx NYSE: BXC, Foundation Building Materials), industrial products (Applied Industrial Technologies, MSC Industrial Direct, Lawson Products), HVAC distribution (Watsco NYSE: WSO), electrical distribution (Rexel, Sonepar private), and dozens of category-specialized platforms. Multiples 6-10x EBITDA driven by sticky customer relationships, recurring purchase patterns, and capital-light operating models.

Fitness, food & beverage, and others. Fitness studios (boutique fitness, franchised fitness): PE consolidation through Xponential Fitness (NYSE: XPOF), Self Esteem Brands (Roark Capital), Crunch Fitness platforms, and several boutique fitness aggregators. Multiples 4-7x EBITDA. Food & beverage co-manufacturing: Hearthside Food Solutions (Charlesbank), Shearer’s Foods, contract packaging operators. Multiples 5-8x. Specialty B2B services beyond IT MSP and accounting: recruiting/staffing, payroll services, employer services (PEO), commercial real estate services, environmental services. Each has its own consolidation cycle and platform set.

How to time your sale relative to your industry’s consolidation cycle

Industry consolidation timing materially affects achievable multiples and sale process dynamics. Selling at the start of a consolidation wave (when first platforms are forming) often produces lower multiples but faster sale processes — the early-mover platforms are aggressive bidders who pay aggressively to establish market position. Selling at mid-cycle (when 4-8 platforms are competing for add-ons) typically produces the highest multiples driven by competitive bidding. Selling at late-cycle (when consolidation matures and sponsors are focused on integration rather than growth) may produce lower multiples and slower processes.

Pre-cycle selling: when waiting may pay back significantly. If your industry is in pre-cycle consolidation (no major PE platforms, multiples in the 3-5x EBITDA range), selling now means accepting an SBA-buyer or strategic-acquirer multiple range. Waiting 24-36 months for platform formation can produce 1-2x of multiple expansion if the consolidation thesis materializes. The risk: the consolidation may not materialize on the timeline expected, or industry headwinds may emerge. Sellers should assess: is the consolidation thesis strong enough that waiting carries low risk, or is there meaningful execution risk in waiting for platforms to form?

Early-cycle selling: trading multiple for speed. If your industry is in early-cycle consolidation (1-3 platforms forming, multiples in the 4-6x range), selling now produces a multiple at the lower end of the eventual range but with faster sale process and less timing risk. Early-mover platforms are often aggressive bidders willing to pay above-trend multiples to establish market position. Sellers in early-cycle industries often see best outcomes by reaching out directly to the 2-3 most likely platform acquirers rather than running a broad auction (the buyer pool is too thin for auction dynamics).

Mid-cycle selling: peak multiple expansion timing. If your industry is in mid-cycle consolidation (4-8 platforms competing actively, multiples in the established LMM range, regular trade press coverage of the rollup), selling now typically produces the highest available multiples. Competitive bidding among 4-8 PE platforms drives auction dynamics and platform-specific synergy premiums. Sellers in mid-cycle industries should run more competitive processes (3-5 management meetings, 2-3 LOIs) than in early-cycle industries to capture full bidder interest. This is the timing sweet spot for multiple expansion.

Reading the signals: how to know which stage your industry is at

Industry consolidation stage is knowable through specific signals that anyone can research. Three primary signals: number of named PE-backed platforms in the industry (1-3 = early; 4-8 = mid; 8+ = late). Trade press coverage frequency of consolidation activity (sporadic = early; routine = mid; ubiquitous with consolidation-of-consolidators talk = late). Multiple trajectory observable through industry research and transaction databases (expanding = early/mid; flat = mid; compressing = late).

Research tools available to any seller. PitchBook and Mergermarket public summary pages identify named platforms in your industry. BusinessWire and PR Newswire press releases announce platform formations and add-on acquisitions in real-time. IBISWorld market reports provide concentration ratios and consolidation stage analysis. Trade publications cover PE activity in their sectors (Service World Expo for HVAC, Roofing Contractor for roofing, FuneralOne for funeral services, MSP Today for IT services, Accounting Today for accounting firms, etc.). Google searches for ‘[your industry] PE platform 2026’, ‘[your industry] private equity acquisition’, ‘[your industry] consolidation rollup’ surface the most active platforms and recent transactions.

Indicators that consolidation is actually arriving in your industry. First ‘named platform’ (PE sponsor announces platform formation with $50M+ initial equity check). Second platform formation within 18 months. Industry trade press starts covering the consolidation theme. Search funders and independent sponsors begin targeting your industry actively. SBIC and BDC lending in your industry increases. Multiple regional PE-backed platforms emerge in 12-18 month windows. When 3-4 of these signals are present, the consolidation is happening; when 1-2 are present, it’s coming but timing is uncertain.

When to involve a buy-side partner versus going it alone. Sellers in mid-cycle consolidation industries (HVAC, plumbing, dental, vet, pest control, IT MSP, insurance brokerage) often benefit from buy-side partners who already know the named platforms and current activity status. Sellers in pre-cycle or early-cycle industries face thinner buyer pools where individual outreach matters more than auction dynamics — a buy-side partner with deep relationships in adjacent verticals can help identify which platforms are most likely to expand into your industry. Sellers in late-cycle industries benefit from buy-side partners who can navigate platform-specific bidding dynamics and time the sale strategically.

Conclusion

PE consolidation moves through industries in predictable cycles. The HVAC wave that hit in 2018-2022 is now hitting roofing in 2024-2026 and will hit electrical contracting, IT MSP, accounting firms, marketing agencies, funeral services, eldercare, residential cleaning, masonry, and paint contractors in 2026-2028. Each industry has knowable signals: number of named PE-backed platforms (1-3 = early; 4-8 = mid; 8+ = late), trade press coverage of consolidation, multiple trajectory, and platform formation announcements. Sellers in pre-cycle industries today face thinner buyer pools and lower multiples; waiting 24-36 months for platform formation can produce 1-2x of multiple expansion if the consolidation thesis materializes. Sellers in early-cycle industries trade multiple for speed; mid-cycle sellers capture peak multiples through competitive auction dynamics; late-cycle sellers face slower processes and risk multiple compression. Identifying which stage your industry is at is knowable through PitchBook, BusinessWire, IBISWorld, trade publications, and direct relationships with active buyers. And if you want to talk to someone who tracks platform formation across 40+ industry verticals weekly, we’re a buy-side partner that works directly with 76+ active buyers and dozens of emerging consolidators across these fragmented industries — the buyers pay us, not you, no contract required.

Frequently Asked Questions

Which fragmented industries are most likely to see PE consolidation in 2026-2028?

Top forward-looking consolidation plays: funeral services (long-cycle, predictable), medical practices beyond dental and vet (specialty-by-specialty), eldercare (home health most consolidated; assisted living and memory care fragmented; personal care services early-cycle), IT MSP (mid-stage), marketing agencies (early-cycle), accounting firms (early-stage post-2021 PE entry), electrical contracting (24-36 months behind HVAC), masonry, paint contractors, residential cleaning. Each industry has its own consolidation cycle stage and timing.

Why is funeral services a slow-moving consolidation play?

Three factors. First, family-business legacy and 3rd/4th generation independent operators with strong community ties. Second, regulatory complexity (state-specific funeral director licensing, embalming requirements, prepaid trust regulations) creates onboarding friction. Third, customer acquisition is heavily community-relationship-driven. Despite 19,000+ US funeral homes and only 15% combined market share for SCI (NYSE: SCI) and Carriage Services (NYSE: CSV), the consolidation has moved slowly. Multiples 5-8x EBITDA today; long-cycle expansion expected over 5-10 years.

Are PE firms really consolidating accounting firms now?

Yes — accounting firm consolidation accelerated significantly 2021-2024. Cherry Bekaert (Parthenon Capital), Aprio (Charlesbank), Sax LLP (recapitalized), Marcum (Cinven equity), Baker Tilly (Hellman & Friedman investment), Citrin Cooperman, EisnerAmper (TowerBrook), and CBIZ Inc. (NYSE: CBZ) all received PE capital or active partnership investment. EY split tax-only operations into a PE-considered entity. The regulatory pathway uses alternative practice structures (APS) to navigate state non-CPA ownership rules.

What’s the timing for electrical contracting consolidation?

Electrical contracting is 24-36 months behind HVAC consolidation. Active 2026 platforms include Sila Services (Goldman), Apex Service Partners (Alpine), Authority Brands (Roark, through Mister Sparky), Yellow Brick Road (Trivest), and Wrench Group (Leonard Green, through Mister Sparky). Multiples 4-6x EBITDA today, likely to expand 1-2x over 24-36 months as platform formation accelerates. EV charging buildout, residential solar, and commercial electrification create multi-decade demand tailwind.

Is IT MSP consolidation really in mid-stage?

Yes — with 4-6 named PE-backed platforms actively closing acquisitions and well-established multiple ranges. ConvergeOne (CVC), Evergreen Services Group (Service Express), New Era Technology, Logically (Riverside), All Covered (Konica Minolta) lead. Multiples 6-9x EBITDA for $1M+ EBITDA MSPs with 60%+ MRR. Cybersecurity-focused MSSPs command premium (8-11x). Mid-stage rollup with possible modest multiple compression over 24-36 months as the wave matures, suggesting near-term selling may be timing-optimal for sellers above $1M EBITDA.

What multiples should marketing agency owners expect in 2026?

Performance marketing agencies with retainer-based recurring revenue (60%+ of revenue from monthly retainers): 5-8x EBITDA. Digital marketing agencies with mixed retainer/project revenue: 4-6x EBITDA. Project-based creative agencies: 3-5x EBITDA. Public relations agencies with retainer-heavy structure: 5-7x EBITDA. Founder-led agencies face dependency discount; multi-leadership agencies with strong second-tier client relationships command top-of-range multiples.

Should I sell my masonry or paint contracting business now or wait?

Masonry and paint contracting are pre-cycle or very-early-cycle consolidation plays in 2026. Selling now means SBA-buyer or strategic-acquirer multiple ranges (3-5x EBITDA for $1M+ operations). Waiting 24-48 months for platform formation could produce 1-2x of multiple expansion if the consolidation thesis materializes — but execution risk exists. Best approach: assess your industry’s platform formation signals (any PE-backed platforms emerging? trade press starting to cover the rollup?) and personal timeline (can you wait 2-4 years?), then decide.

What’s happening with eldercare consolidation in 2026?

Eldercare consolidation is uneven across subcategories. Home health is most consolidated: Encompass Health (NYSE: EHC), LHC Group (Optum), Amedisys (NASDAQ: AMED), Addus HomeCare (NASDAQ: ADUS), BAYADA. Multiples 8-12x EBITDA. Hospice is similarly consolidated: VITAS Healthcare (Chemed Corp NYSE: CHE), Compassus (Towerbrook), Bristol Hospice (Webster). Multiples 9-13x. Assisted living and memory care less consolidated: Brookdale (NYSE: BKD), Sunrise, Atria, Holiday. Multiples 7-10x assisted living, 9-12x memory care. Personal care services early-cycle: 5-7x EBITDA.

How do I tell if my industry is at pre-cycle, early-cycle, or mid-cycle consolidation?

Three primary signals. First: number of named PE-backed platforms in your industry (0-1 = pre-cycle; 1-3 = early-cycle; 4-8 = mid-cycle; 8+ = late-cycle). Second: trade press coverage frequency (none = pre-cycle; sporadic = early; routine = mid; ubiquitous with consolidation-of-consolidators talk = late). Third: multiple trajectory (3-4x with no expansion = pre-cycle; 4-5x with modest expansion = early; established LMM range with peak expansion = mid; range compression = late).

What’s the difference between pre-cycle and early-cycle from a seller’s perspective?

Pre-cycle: no PE platforms exist; buyer pool is SBA buyers, search funders, strategic acquirers; multiples are 3-5x EBITDA range. Sellers face thin buyer pools and limited competitive bidding. Early-cycle: 1-3 PE-backed platforms have formed; multiples have expanded to 4-6x range; buyer pool widens to include early-mover PE platforms alongside SBA buyers and strategics. Sellers benefit from direct outreach to specific platforms rather than broad auction processes (which still don’t generate enough bidder competition at this stage).

How accurate are these forward-looking consolidation predictions?

Industry consolidation timing has moderate predictability. The HVAC consolidation wave that hit in 2018-2022 was predictable from earlier indicators (fragmentation, recurring revenue characteristics, adjacent-vertical M&A precedent). The roofing wave that hit 2024-2026 was similarly predictable. Forward-looking predictions for electrical contracting (24-36 months behind HVAC), IT MSP (mid-stage), accounting firms (early-stage), and similar industries follow the same pattern. Execution risk exists: industries can fail to consolidate on the predicted timeline if capital availability shifts, regulatory changes occur, or industry-specific headwinds emerge.

Should I wait for platform formation if my industry is pre-cycle?

Depends on personal timeline, industry growth trajectory, and risk tolerance. Pros of waiting: 1-2x multiple expansion if consolidation materializes (24-48 months typical horizon), wider buyer pool, more competitive bidding. Cons: industry growth must continue to support business value, consolidation may not materialize on expected timeline, personal timeline may not accommodate 24-48 month wait, capital availability for PE platforms may shift. Best approach: get an honest assessment of your industry’s consolidation likelihood from a buy-side partner with deep cross-industry visibility.

How is CT Acquisitions different from a sell-side broker or M&A advisor?

We’re a buy-side partner, not a sell-side broker. Sell-side brokers represent you and charge you 8-12% of the deal (often $300K-$1M) plus monthly retainers, run a 9-12 month auction process, and require 12-month exclusivity. We work directly with 76+ buyers — including emerging consolidators in IT MSP, accounting firms, marketing agencies, eldercare, and trades adjacent to home services consolidation — who pay us when a deal closes. We track platform formation activity across 40+ industry verticals weekly, know which sponsors are actively underwriting new platforms in which industries, and can identify which sellers are well-positioned for early-mover platforms versus better off waiting. You pay nothing. No retainer, no exclusivity, no contract until a buyer is at the closing table.

Sources & References

All claims and figures in this analysis are sourced from the publicly available references below.

1. PitchBook Lower Middle Market Private Equity Industry Reports — Industry-level platform formation tracking, deal flow data, and consolidation cycle stage analysis across 40+ industry verticals including funeral services, IT MSP, accounting, eldercare, and electrical contracting.
2. IBISWorld US Industry Reports (Industry Concentration & Fragmentation) — Industry size, concentration ratios, fragmentation metrics, and consolidation stage analysis used to identify pre-cycle, early-cycle, mid-cycle, and late-cycle industries.
3. Service Corporation International (NYSE: SCI) Investor Relations — Public-company filings disclosing 1,500+ funeral home and cemetery locations, 30-50 acquisitions per year, and the largest market share in the highly fragmented US funeral services industry.
4. Carriage Services (NYSE: CSV) Investor Relations — Public-company disclosure of 170+ funeral home and cemetery locations and acquisition strategy benchmarking funeral services consolidation thesis.
5. Encompass Health (NYSE: EHC) Investor Relations — Public-company filings supporting home health consolidation thesis and Medicare reimbursement complexity favoring scale, with 8-12x EBITDA acquisition multiple precedent.
6. American Bar Association — State CPA Ownership Rules — Legal analysis of state-by-state non-CPA ownership rules for accounting firms and the alternative practice structure (APS) framework enabling PE entry into accounting firm consolidation.
7. BusinessWire Press Releases — PE Platform Formations — Real-time tracking of PE platform formation announcements across IT MSP, accounting firms, marketing agencies, eldercare, and electrical contracting in 2024-2026.
8. Brookdale Senior Living (NYSE: BKD) Investor Relations — Public-company disclosure of 600+ senior living communities supporting eldercare consolidation thesis in assisted living and memory care segments.
9. Stagwell Inc. (NASDAQ: STGW) Investor Relations — Public-company filings disclosing 2021 Stagwell-MDC Partners merger and ongoing acquisition strategy across digital marketing, performance marketing, public relations, and adjacent marketing services.
10. Acrisure Corporate Information — Insurance brokerage consolidator with 1,000+ acquisitions completed since founding in 2005, supporting late-cycle consolidation thesis and 8-11x EBITDA multiple range for P&C agencies.