A curious analysis, the EVCA Numbers 1st Half 2009, arrives on my desk. It runs a pretty exhaustive, (or exhausting), analysis of venture and private equity activity in Europe for fund raising and funding. Chart after chart shows what a terrible state the industry is in although for some reason the analysis chooses to compare whole year 2007, whole year 2008 and half year 2009.
Scary EVCA VC and PE investment chart
Now we know that 2009 has been hard, and given the lack of exit opportunities for funds and the general fund raising situation, investors are likely to have to be careful with their funds. We can also see that investors are starting to invest again and the 3rd quarter venture capital investment has been the highest for 6 quarters in both US and Europe.
It seems slightly strange to me that venture capital and private equity should be treated as a single asset class – they are very different. It also seems slightly strange that an industry body should be producing such a potentially confusing and negative picture unless there is another reasons for it. Could it be anything to do with the potential reforms mooted in Brussels? If so, it would surely be better to focus on the absurdity of these ideas rather than paint a picture that is unnecessarily bleak?