In a recent LinkedIn post, Lee McCabe delves into a critical, albeit informal, term circulating within the private equity world: JAMBOG. This acronym, standing for ‘Just Another Middle Market Buyout Group,’ serves as a stark descriptor for firms perceived as indistinguishable in their strategies and market approach.
McCabe highlights the prevalence of this term, particularly within online communities frequented by private equity associates. He notes that while it’s an unofficial designation, it carries significant weight in discussions comparing firms and career trajectories.
“It is an insult. JAMBOG stands for Just Another Middle Market Buyout Group. You will also see JAMMBOG. It describes the perfectly respectable generalist fund that buys perfectly respectable businesses using roughly the same playbook as several hundred perfectly respectable competitors. In other words, completely forgettable.”
The Middle Market Glut
Lee McCabe points to substantial market activity in the US middle market, citing PitchBook data that recorded over $410 billion in deals across more than 4,000 transactions in 2025. However, he contrasts this with a less optimistic fundraising environment. US middle market vehicles saw a significant drop in capital raised, down 43.3%, and a decrease in fund count by 41.5%.
According to McCabe, this disparity is linked to the generic nature of many investment strategies. He outlines the common, yet uninspired, elements often found in pitches:
- Broad sector mandate
- Deep relationships
- Proprietary sourcing
- Operational expertise
- Disciplined underwriting
McCabe argues that these standard components, when not backed by genuine differentiation, lead to firms being easily overlooked.
Differentiation Beyond Labels
The core of McCabe’s analysis centers on the necessity of true differentiation in a crowded market. He contends that simply targeting a specific sector, like healthcare, does not constitute a unique investment thesis.
“Differentiation has to survive contact with an actual deal. It should be visible in the opportunities a firm sees, the reasons sellers choose it, the operational interventions it can execute and the results it has repeated across several investments. A sector label on slide six is just better stationery.”
In Lee McCabe’s view, genuine differentiation must manifest in tangible ways: the types of deals pursued, the appeal to sellers, the effectiveness of operational improvements, and a consistent track record of successful outcomes. Anything less, he suggests, is merely superficial.
The LP Perspective and Fundraising Challenges
McCabe connects the increased scrutiny on investment strategies to shifts in Limited Partner (LP) liquidity. He references McKinsey data indicating that distributions were approximately 6% of buyout Assets Under Management (AUM) in the first half of 2025, a significant drop from the 14% ten-year average. This scarcity of available capital makes LPs less tolerant of vague or undifferentiated strategies.
“Fundraising has become less forgiving because LP liquidity has become less forgiving… When cash is scarce, vague strategies become remarkably easy to ignore.”
As Lee McCabe concludes, the playful acronym JAMBOG underscores a serious issue in private equity. While the term might be amusing, the reality of being a forgettable firm in a competitive landscape is far from it. He emphasizes that in an environment where capital is tightening, firms must demonstrate clear, actionable differentiation to stand out and succeed.
📝 About This Content
This article is based on insights shared by Lee McCabe on LinkedIn.
📅 Originally posted on September 8, 2026 | View original post on LinkedIn →