California, Massachusetts, Utah, and New York are the U.S. states with the highest proportions of private equity- and venture capital-backed enterprises, according to data from S&P Global Market Intelligence.
California had 347,564 private enterprises, with 24,228 backed by private equity, resulting in a penetration rate of 6.97% — the highest in any state.
Massachusetts’ private sector is made up of 70,115 enterprises, with 6.11% backed by private equity.
Utah and New York have private equity penetration rates of 4.98% and 4.50%, respectively.
Overall, the private equity penetration rate in the U.S. is 3.49%. The rate has climbed from 3.47% in September 2023, when Market Intelligence last tracked the criteria. As of Aug. 11, the U.S. private sector was comprised of 2,374,567 enterprises, with 82,927 owned by private equity. In 2023, private companies totaled 1,802,811, of which private equity owned 62,489.
Wyoming had the most notable increase in penetration rate, rising to 3.16% in 2025 from 2.15% in 2023.
Sector breakdown
Companies in the technology, media and telecommunications (TMT) sector account for approximately 44% of those with private equity ownership. California hosts 13,403 such companies, the highest of any state.
From 2023 to 2025, the number of private equity-backed TMT companies in the U.S. grew by roughly 35% to 36,562. New York, Texas, Massachusetts, and Florida also have over 1,000 TMT companies each.
“Private equity and venture capital investors tend to be attracted to states with a concentration of high-growth sectors such as technology, renewable energy, life sciences, healthcare, and logistics,” Don Zambarano, KPMG U.S. private equity sector leader, said in emailed comments.
Innovation ecosystems such as research universities, incubators, and public-private innovation programs, as well as factors that reduce operating costs so that companies can scale efficiently, also drive private equity investments, Zambarano added.
Rounds of funding
The overall value of venture capital and private equity rounds of funding surged 61% to $183.26 billion in 2024 from $114.05 billion in 2023.
However, transaction volume declined 15% to 5,229 deals from 6,125 the previous year.
Source: S&P Global
