Data shows fall in big-ticket start-up investments

SINGAPORE – The global pandemic has had a profound impact on the appetite to invest in new start-ups, according to data compiled by global data analytics specialist GlobalData.

The British-based data research firm found that big-ticket, billion-dollar deals were mostly non-existent during the October-December quarter of last year.

Of the total 3,603 global deals during the quarter that disclosed deal value, 66.2 per cent were low-value deals, with US$10 million (S$13 million) or less investment value, while those valued at more than US$100 million stood at just 4.2 per cent.

GlobalData lead analyst Aurojyoti Bose cited investor caution as the main reason for the fall in investment quantum.

He said: “With tough market conditions and an uncertain business environment, cautiousness prevails among investors when committing to big-ticket investments.”

Venture capital (VC) investment volume (deals with disclosed deal value) decreased by 14.7 per cent from 1,357 deals in October to 1,158 in November, and further shrank by 6 per cent to 1,088 last month

In October, low-value deals stood at 69.1 per cent of the total deal volume, while the share of deals valued more than US$100 million stood at just 3.8 per cent. No deals valued at more than US$1 billion were announced that month.

Similarly, in November and last month, low-value deals accounted for 66.7 and 62 per cent respectively of the total deal volume, while the share of deals valued more than US$100 million stood at 3.7 and 5.3 per cent respectively. Both months each saw the announcement of one deal valued at over US$1 billion.

However, with the Covid-19 vaccine roll-out under way worldwide, there is potential for a pick-up in VC investment numbers by mid-year, analysts reckon.


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