In a special report on global venture capital insights and trends for 2013 Ernst & Young said they believe that “steadying economic conditions will bolster investor confidence and increase risk appetite. This and the prospect of better exit opportunities ahead could make 2013 a more positive year for venture capital”.
The same report highlights that fact that in 2012 global VC investments declined by 20%, the number of investment rounds by 8% and the average round size decreased by USD 1,2m.
Consolidation of the market in 2012 also brought down the number of VC-backed IPOs and exits. The amount of raised via IPO declined globally by 27%.
VC investments remain strongest in US and Europe
According to E&Y report “VC investments remain strongest in the US and Europe, falling only 15% in 2012”. In Israel and China the decrease was more than 40%. On the other hand, India was the only country to see an increase in the number of investment rounds.
It is clear that European investments have slowed down due to uncertainty and liquidity problems, under certain circumstances. Therefore in 2013 European investors need to look deeper into risk financing solutions, focusing also on early stage investments and identifying sustainable positions for their money. Exits are also something Europe needs to focus on in 2013.
