Investment Outlook Surprises, Venture Capital still up for a Twist

The world of venture capital masquerades as a promising sphere of investment, with the surge of high budget-deal seeming to indicate an optimistic-future outlook. However, diving deep into the analytics, tells a different tale. On evaluating the data, it’s clear that the first half of this year saw a decline in the cheque issuances, with 11.5% less worth being generated compared to that in the first half of the prior year.

Even though the total investment amounted to an impressive €23.8bn, across 2,143 funding rounds, the investors’ underlying sentiment remains wary, with key industry players like Jan Miczaika, a partner at HV Capital indicating a lack of meeting projected growth.

In addition, the defence tech industry also emerged as a lucrative investment sector, with a German AI defence start-up, Helsing, raising a whopping €600m.

While there are bright spots in the investment world, the cause for worry lies in the relatively inactive M&A landscape and disheartening IPO front. These trends, indeed, present a more substantial challenge for venture capitalists. The VC fundraising process itself has been strained due to the lingering roadblocks in the investment pipeline leading to predictions of VC fundings falling to almost a decade low.