Welcome to the Q4’2016 edition of KPMG Enterprise’s Venture Pulse Report – highlighting the current trends, opportunities and challenges faced by the venture capital (VC) market, both globally and in key regions around the world. In this edition, we reflect back on 2016 as a whole and discuss what the future might hold for venture capital investing in 2017.
After a relatively good start to 2016, caution took a strong grip on the VC market, extending its hold throughout the remainder of the year. Q4’16 saw further dips in both venture capital investments and, in particular the total number of deals in the Americas, Asia and Europe. While year-end numbers show 2016 lagging the peak deal values of 2015, the sharp decrease in the number of deals compared to last year reflects ongoing investor concerns within the VC market.
Asia and the Americas continued to bear the brunt of VC investor pullback during Q4’16, with sharp declines in the number of deals and capital invested. This quarter Europe showed more resilience in terms of total capital invested, despite the region facing geopolitical uncertainty in a number of EU member states, in addition to the uncertainties related to the UK’s Brexit vote. The region’s growing diversity of technology ecosystems is likely one factor in the region’s relative resilience, although its smaller size (compared to the Americas and Asia) likely also had a moderating impact.
Source : KPMG