The BVCA has released their annual investment activity report. The report contains benchmark investment activity data for the UK Private Equity and Venture Capital industry. Data is based on the combined investments, divestments, and fundraising information of the BVCA full member firms. The report details investment information that is broken down across industry sectors, financing and investment stages, and UK regions.
The total equity amount invested in portfolio companies in 2017 increased by 4% year-on-year to £22.23bn. The number of companies receiving investment saw an increase of 11%, rising to 1,030 . Buyout investment increased over 21% year-on-year to £18.22bn and the number of companies backed increased by 46% to 230. Large buyouts accounted for 47% of the buyout market, followed by mega buyouts at 30%. Small buyouts almost doubled year on year to
£348mn with 82 companies backed. There year on year increase of almost 17% for the midmarket with £3.8bn investing in 114 companies. Venture capital investment increased by 45% to £820m and effectively doubled since 2014. 485 companies were venture-backed: a 36% increase. Seed investments grew by almost 300%, reaching £56m followed by early stage financing which year-on-year nearly doubled in size to £313m. Start-up grew to £84m, which is an increase of 75%. Later stage investments grew by 10% to reach £366m. Growth capital investments decreased by 40% to £1.95bn. 297 companies were backed, an 8% decrease year-on-year.
Around 500 companies were exited in 2017, approximately a 10% decrease compared with 2016. By amount of former equity investments (divestments at cost), the total value was £14.14bn, a year-on-year decrease of more than 50% compared with last year’s record of £29bn. The most prominent exit routes by amount at cost were trade sale (31.5%), sale to another private equity firm (27.9%) and public offering (16.4%). Buyout divestments represented 80% by amount at cost and around 40% by number of companies of all exits in 2017.
Venture capital comprised around 20% of all divestments with 100 companies. The most prominent exit route was trade sale, which represented more than 50% in amount at cost divested in 2017. Growth divestments represented 14% of all exits by amount at cost and 31% by number of companies.
Fundraising in 2017 reached a total of £33bn with 79 funds raising new capital. Pension funds provided 40% of all capital raised followed by sovereign wealth funds (17%), fund of funds (11%) and private individuals (8%). 82% of contributions were from institutional investors from outside the UK. Buyout fundraising reached £31.33bn but pension funds were identified as the largest institutional investor in UK with buyout funds contributing 42%, followed by sovereign wealth funds (18%), fund of funds (11%) and private individuals (7%). Venture capital fundraising reached £770m with private individuals contributing 34% to the total VC fundraising amount. Government agencies followed next (15%) and capital markets & corporate investors (13%). Growth capital reached £330m. The largest contributor, at 29%, was pension funds followed by Government agencies at 21%.
To read the report in full click on this link http://bit.ly/2vMtpo0