EY Report – Venture Capital Trends (2014)
The latest EY Global Trends Report and accompanying Insights Deck show that 2014 was an exceptional year, with funding at levels not seen since 2000. Bryan Pearce, Global Leader, Entrepreneur Of The Year™ and Global Venture Capital Advisory Group sat down to talk about the record year VC had in 2014 and what to look for in 2015.
From a geographic perspective, given the strength of its economic recovery, VC activity in the US should continue to perform well in 2015. The outlook for Europe is less certain given the slow Eurozone recovery and uncertainty around monetary policy on the continent. Despite slower growth in China, which the authorities are combatting with easier monetary policy, the structural rebalancing of the Chinese economy will continue to support VC activity.
In terms of sectors, we anticipate that interest will continue to focus on technology, health care, consumer, business and financial services. Consumer services companies were recipients of the most investment in 2014, with US$29b invested in 1,690 deals, up 130% by deal value on 2013. Business and financial services also proved attractive to VC investment, with US$20.2b raised in 1,682 deals.
Positive Exit and Fundraising Environments Driving Activity
Improving macroeconomic conditions have underpinned investor confidence and fueled the development of an active exit and positive fundraising environment. With a first-day average increase of 25.2%, VC-backed IPOs globally delivered particularly well for investors, with the overall IPO market delivering an average first day increase of 12.9%.