Hinsley Ford Buoyed By Strong Second Quarter Private Capital Statistics Reflecting Growth In Investments And Deal Volume

Top Quote In the second quarter of 2014, Canada's private equity and venture capital sectors both reported significant year on year growth in terms of capital invested and companies invested in. End Quote
  • (1888PressRelease) October 02, 2014 - For the private equity sector, investment activity increased fivefold over the same period last year, while for the venture capital industry the growth was a very significant 31% according to data released today by Canada's Venture Capital and Private Equity Association (CVCA).

    Commenting on the results Mike Woollatt, CEO of CVCA noted that "the rapid growth of the private equity sector in 2014 is great for the Canadian economy Canada's private equity industry is continuing to see robust returns derived from solid investment, which is helping drive fundraising to record levels." Mr. Woollatt went on to add, "The Canadian venture capital industry has also enjoyed new heights in investment activity in the recent quarter, characterized by a greater breadth of investments and more high-value liquidity events. While these accomplishments in the venture sector are encouraging, we remain concerned about domestic venture capital fundraising activity, which materially lags the pace and volume of fundraising in other jurisdictions, such as the United States. Without an increase in capital allocation to our domestic VC ecosystem, there is a real risk of foreign investment dominating our industry, and a slowing in new company formation and growth within Canada's innovation economy, which derives significant capital from venture capital investors.

    PRIVATE EQUITY DATA HIGHLIGHTS the $5.3 billion of private equity invested in the second quarter of 2014 was more than five times the amount invested in the same period last year. In the first half of the year, private equity investments totaled $9.7 billion, roughly triple the $3.2 billion disbursed in the first half of 2013. Increased investment activity also resulted in a substantial 29% increase in deals done in the quarter, bringing the quarterly total to 103 transactions. In addition, Canadian private equity fundraising continued to outperform the record fundraising results achieved in 2013. New capital commitments totaled $7.4 billion in the first half of 2014, doubling the level of commitments reported for the same period last year.

    The amount of venture capital invested in the second quarter of 2014continued to grow with $505million invested across130 deals, representing increases of 31% and over the same period last year. In the first half of 2014, VC activity in investments and number of deals was significantly higher than in the same period of 2013.

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