The Private Equity slow-down

In 2015, the number of UK private equity-backed* fundraisings fell by 11% across the board – with absolute yearly deal figures dropping from 488 to 441.

Looking at our data, we can see that private equity-backed fundraisings mirrored a wider market slow-down in 2015. As we explored in The Deal, and more recently with Dry Jan – UK Equity’s slowest start since 2012, while 2015 saw encouraging growth in terms of total investment, the number of fundraisings flatlined on 2014 figures.

Growth-stage the only grower

Our stage of evolution data tells us that it was venture- and seed-stage fundraisings that felt the biggest squeeze in 2015. The number of private equity-backed venture-stage deals fell by 19%, while the seed-stage recorded a 10% drop in fundraisings. The growth-stage, however, actually completed one more private equity-backed deal than it did in 2014, recording 175 fundraisings in 2015.

This marries, to an extent, with our findings from the wider market in 2015. The decline in deal numbers during the second half of the year was primarily driven by institutional investors backing away from the seed-stage market.

More than meets the eye?

Against the backdrop of a stagnant wider market in 2015, private equity lost market share while crowdfunding gained market share. Over the coming months it will become clearer whether in retrospect crowdfunding was just picking up the slack for private equity or was, in fact, muscling in on private equity’s share of the market.