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Bailey McCann, Opalesque New York: Private equity and venture capital deal activity has been slow going in the first half of 2024. That's especially true in Europe where new data from PitchBook points to broadly unfavorable conditions for private equity and venture capital. Fewer large deals are taking place across private capital
markets, with higher costs of capital, sluggish growth, and valuation uncertainty
affecting appetite.
PitchBook data shows that private equity and venture capital investments are approximately 2.1% lower than
full-year 2023, while exit count is tracking 26.5% lower. PitchBook analysts point to persistently higher interest rates being part of the problem. Cost of capital remains high which is putting pressure on exits. However, that could change going into the back half of the year.
"Looking at the second half of 2024, we expect a moderate recovery in exits given the
green shoots we have been seeing, notably from PE-backed public listings, which are
tracking higher than the previous two years. A soft landing would boost corporate
exits, while monetary easing will help exits to sponsors," PitchBook analysts write in a recent research note. They add that if European central banks begin cutting rates in earnest this year, the deal environment could improve rapidly.
Exits are likely to remain low in venture capital either way, analysts write. European VC-backed IPO value sat at €55.8 million as of the end of May 2024. This
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