Another Report Indicates that Global Venture Capital, Private Equity Deals Have Declined Versus Year Prior

The reports keep rolling in, highlighting a slowing environment for private firms. Venture capital, along with private equity activity, has been in decline for some time now – a fact that should come as no surprise to anyone. Giga high inflation and the inevitable reaction by central banks attempting to crush rising prices means money has become much more expensive. Economies around the world have slowed with geopolitical strife, like the war in Ukraine not helping the situation. READ MORE

We Can't Rely on Venture Capital Funding to Build a Just and Thriving Entrepreneurial Economy. Here's What to Do Instead

The venture capital (VC) funding model is often portrayed as the new version of the American Dream — a plucky start-up founder invents a disruptive new technology, catches the eye of venture capitalists, sells the company for hundreds of millions, and spends the rest of their days sailing the Mediterranean. It's a nice story for the .01% of business owners who can — or want to — achieve that outcome. READ MORE

VC funds bid era of double-digit returns goodbye

The yearslong era of venture capital outperforming other private market asset classes is likely coming to an end.

An abundance of near-free capital and a robust IPO market allowed venture capital funds to post double-digit percentage returns in nearly every quarter from Q4 2017 through Q1 2022, according to PitchBook's 2022 Global Fund Performance Report. But by this year's second quarter, the venture funds' internal rate of return turned negative. READ MORE

Founders should consider VC firms their allies as they build in the bear market

This year’s bear market trajectory should be looked upon as a favorable opportunity for Web3 founders to raise capital and build cutting-edge products. Some of the most robust businesses today were built during market downturns, and founders now have a real opportunity to ensure they’re building products and services that meet genuine, real-world needs and look beyond oversized checks to find the most suitable business partnership. READ MORE

Venture Capital and Private Equity Continue to Have a Taste for HR and HCM Tech Opportunities

The Surprise: While recession risks have led VCs to press pause on many pandemic favorites, the Human Capital Management (HCM) niche has proven to be the exception. 

It is a crowded space - over 400 HCM companies set up shop at the 2022 HR Technology Conference in Las Vegas. There's a reason for all the competition. The need for a scientific approach to managing a company's workforce gained steam during the COVID-19 pandemic, leading HR Tech to receive a record amount of VC attention in 2021. Despite all the hype over the past two years, this trend shows signs of staying power. The global HR Tech space is projected to expand at a CAGR of 9.1% through 2029 to $46.85B, which dwarfs the current size of $25.53B.  READ MORE

Survival Of The Carried Interest: Reform To The Private Equity Model Has Been Voted Away Again

The carried interest has managed to survive another round of attempted reform. The Inflation Reduction Act of 2022 was passed by the Senate on Aug. 7, 2022, without its proposed modifications to carried interest rules. The last minute removal came down to a decision by Senator Krysten Sinema, whose vote was necessary to pass the bill in a divided Senate. READ MORE

Private equity set for slower asset growth, fundraising

Private equity is on track for sluggish growth over the next five years as inflation and macroeconomic uncertainty take their toll on investments and investors shift capital to lower-risk asset classes, a new report from Preqin Inc. predicts.

Preqin forecasts continued but slower expansion of assets under management for the global private equity industry, totaling $7.6 trillion by 2027. That would represent an 80% increase from the industry's collective AUM today, which the report estimates at $4.2 trillion. READ MORE

Bootstrapped v VC: 5 things to know before deciding to take on funding

Given the current economic conditions, it’s gotten a lot harder for startups to raise the kind of funding rounds that were once the norm a few years ago.

Either by choice or because they haven’t been able to close a round, this has led many startups to consider whether the VC path is actually the right one for them or whether they are better off trying to bootstrap their business. READ MORE