Ted Koenig, Chairman and CEO of Monroe Capital, joined Julie Cooling, Founder and CEO of RIA Channel, at iCapital Connect 2026 to discuss key drivers of performance in the lower middle market.
Koenig notes that success in private markets comes from identifying and capitalizing on the right niche. At Monroe Capital, which focuses on the lower middle market in the $10 to $40 million EBITDA range, he points to business software, business services, distribution, and AI hardware as areas of attractive opportunity.
Another key determinant of success, according to Koenig, is manager selection. Rather than focusing on asset classes, he believes manager selection should be the top priority, citing that top-quartile managers over the last 10 years drove 12.7% returns compared to just 7% for bottom-quartile managers.
Koenig also highlights education as a critical component in the wealth space. He emphasizes the importance of educating investors on a product basis to ensure they fully understand what they are investing in. He references the ongoing misunderstanding of semi-liquidity, frequently reported in recent headlines, as an example of the pitfalls of inadequate investor education.
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