A shakeout in the private-equity industry is forcing firms to adapt or get left behind.
The landscape of successful firms is increasingly divided between behemoths with several business lines such as Blackstone and Apollo Global Management and top performers that have focused on their roots of buying and selling companies for a profit. Firms that fall in the middle—those that are big, but not big enough, or whose returns are good but not great—are finding it difficult to raise money.
