Private investments 2012 start on a high

As the first 2012 issue, the bulletin of Go4Venture Research starts on a rather positive note – but probably reflects market seasonality: Private investments start on a high compared to the same month last year. This probably has more to do with 2011 transactions taking a bit longer than expected, rather than a true jump in activity levels. However, we see a recurring theme: same number of transactions, but larger amount transacted, reflecting larger individual investments driven by later stage investments.

M&A is rather subdued, especially compared to the same period last year – which probably reflects the uncertain times the world economy is going through. Interestingly, of the two published VC/PE transactions highlighted in the latest Go4Venture bulletin, one is a great success in terms of multiples of money invested (close to 5x) but with a somewhat modest absolute outcome (€44mn). However, the other returns only about half of the amounts invested but was at least an ambitious attempt at creating a world leader in an emerging space. The good news is that Europe (in fact the UK) still has two other well-funded startups in the space – both of which have been recently refinanced. This is the sort of strategic intent and determination in funding ambitious plays which is making European venture a growing success despite its slow going in the 2000s.