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65% of VC leaders have positive outlook on state of industry

Sixty five per cent of managers and partners in the US venture capital industry are more confident and optimistic about the economy today as compared to a year ago, despite ongoing economic worries in Europe, according to a new survey by Polachi.

The findings of Polachi’s Venture Capital Confidence Survey are in stark contrast to other CEO confidence surveys from this month, the jobs report for the past several months, and other economic assessment reports.

According to the survey, nearly 76% of those polled believe the economic outlook is improving, 24% believe the East Coast vs West Coast innovation competition has enhanced the outlook and industry pace, while 13% believe there are more available funds in comparison to FY 2011.

Some 75% however, still view the European Zone economic crisis as a problem for business.

Cloud is rated as the most important trend for VC by 45% of respondents, while 61% believe the Facebook IPO will impact future technology IPO’s and 30% believe that crowdfunding will have a negative impact on the availability of funds.

The following regions were rated in order of hottest areas for investment opportunity: West (53%), East (34%), Midwest (4%), and Outside US (9%).

“Venture capital leaders use a longer term lens to assess the outlook for their industry. They have a very positive view for start-ups, innovation opportunities, and the rate of funding creation,” says Charley Polachi, Partner at Polachi. “Contrast this with tech CEO’s who are impacted by the quarter-by-quarter results and held accountable to shareholders and the stock market swings. The net effect of this accountability differential is that this group of leaders is far more reluctant to add staff so job creation numbers from this sector continue to be stagnant.”
 

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