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Alternative Market Briefing

Private equity & venture capital total capital raised in Q1 2020 was up 12% on Q1 2019

Friday, April 10, 2020

Laxman Pai, Opalesque Asia:

Amid the global economic disruption caused by the COVID-19 pandemic, although total capital raised in Q1 2020 was up 12% on Q1 2019, the number of private equity & venture capital (PEVC) funds closed marks one of the lowest quarterly totals we have seen in recent years, said a study.

Total capital raised is consistent with cyclical trends, but capital sits with fewer managers and in the most developed markets, said Preqin.

"Q1 private equity fundraising typically wakes slowly before its crescendo later in the year. The start of 2020, though, was met with considerable headwinds for the global economy as it faced the fallout from the COVID-19 pandemic," Preqin said in its Quarterly Update: Private Equity & Venture Capital Q1 2020.

The effect on global fundraising has been muted. In total, $133bn was raised across 267 funds in Q1 2020.

Although both the number of funds and amount of capital raised fell compared with Q4 2019 by 32% and 29% respectively, these are not far out of line with Q4 to Q1 moves in prior years.

Total capital committed exceeded Q1 2019 levels despite fewer funds closing.

Private equity investors favored developed markets over Asia and the rest of the World. North America- and Europe-focused funds together captured more than 89% of the aggregate capital raised globally in Q1 2020, representing 209 of the 267 funds closed.

After rebounding into Q3 2019 with $46bn in commitments, Asia-focused funds failed......................

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