Coller Capital sent out its “Winter Global Private Equity Barometer” today and the picture ain’t too pretty. But amid the gloom was one positive sign: the majority of North American investors see an improving market.
The London-based firm reports the venture capital (VC) numbers near the end of its report.
As you can see, investors around the world see little signs of hope with 63% of limited partners (LPs) expecting very few VCs to bring in strong returns over the next decade and one-fifth expecting absolutely no VCs to show strong returns.
The report is especially bad for early-stage investments. As Coller Capital states on its website: “Early-stage companies in Europe and Asia-Pacific are also being starved of venture capital funding, investors think. 57% of European LPs and 63% of Asia-Pacific LPs believe this, though only one third (37%) of North American investors think the same is true in their region.”
Sheesh.
But there is a bright spot. While most LPs predict a diminishing VC climate in Europe and Asia, the majority of those surveyed believe the North American investment market is on the upswing.
This is an important figure. To raise money to invest in startups VCs need to show a record of positive returns. The fact that these investors are feeling better about the North American market suggests VCs have confidence in their portfolios.
For anyone working with sophisticated technology this is good news. Innovation is seeded and germinated with the funds provided by LPs and VCs, their continued sowing relies on confidence. Today’s report suggests that confidence, at least locally, is coming back. Welcome news for startups large and small.
