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Positive sentiment on the private equity market
Frankfurt/Main (ots) -
- German Private Equity Barometer reaches three-year high - Early- and late-stage financiers optimistic for 2015 - Fundraising climate better than ever
After a brief lull in the third quarter, the business climate index of the German Private Equity Barometer once more gathered pace in the fourth quarter of 2014, rising by 9.6 points to 57.4 balance points. Thus, the sentiment among German private equity investors hit a three-year high at the end of the year. Assessments improved for both the current business situation and business expectations in the final quarter (+5.5 to 53.6 balance points and +13.7 to 61.2 balance points). This optimism is supported in particular by the fundraising opportunities that are considered better than ever, as well as a continued good environment for exits.
The business climate has recently improved in both the early and late-stage segments of the private equity market. In late-stage financing, business expectations are the driving factor behind the improved sentiment. According to the private equity companies' assessments, their current business situation remains virtually unchanged. In all, the year drew to a satisfactory close with a business climate of 57.8 balance points (+14.3 points). In the early-stage segment the sentiment indicator at the end of 2014 rose to 56.8 balance points (+12.9 points), which is the second-highest value since it was first published in 2003. The business situation and business expectations are considered to be equally more optimistic. The early-stage financiers are also experiencing a tailwind as a result of the continued high demand for venture capital.
"The sentiment among equity capital investors has increased and the early-stage financiers in particular are expressing greater satisfaction," says Dr Jörg Zeuner, Chief Economist at KfW Group, summarising 2014. Dr Zeuner is confident of the continued availability of venture capital and emphasises its importance for young, innovative technology companies: "Venture capital is essential for survival as high start-up losses or forced growth can only be recovered through equity. The supply of venture capital is therefore a key factor for Germany as a technology location."
Ulrike Hinrichs, Managing Director of the German Private Equity and Venture Capital Association (BVK) added: "The far-reaching upswing in sentiment at the end of the year across the segments illustrates the stability of the equity market. This is also emphasised by our market statistic, which indicates a considerable increase in investment compared with the previous year. In light of the optimistic expectations of the survey participants, we are confident that this positive development will also continue in 2015."
"KfW compiles the German Private Equity Barometer jointly with the Bundesverband deutscher Kapitalgesellschaften e. V. BVK exclusively for Handelsblatt." A detailed analysis for the current German Private Equity Barometer, including data table and graphic, is available at www.kfw.de/gpeb.