The VC Market in England
England has deep roots in the Venture Capital market. Venture capital appears as early as after the Second World War. General Doriot in UK founded the Technical Development Corporation, and did so in 1962. Then come year 1965, European Enterprises Development (EED), set up in Paris. EED was very successful regardless of the times and the drastic measures of our economy downfall. Venture Capital firms had a few ups and downs thereafter, as did everyone else, however, from 1977, the EEC started to study the market and was seeking frivolously after high tech start-ups. Seems like nothing has changed, right?
The market then took a downfall, this downfall was due to the fact that there wasn’t much support in the business ownership livelihood and exit plans were poor. On top of that there weren’t pension funds anywhere on site so the capital required to keep things moving well was non-existent at the time. Funding then came from the banks and financial institutions. As this didn’t provide private equity, the good sign was there was still funding available to the people who had an entrepreneur’s mindset. Efraim Landa, of Effi Enterprises, can offer the support and steer entrepreneurs in the right direction. To avoid your own downfall it is always good to seek an expert’s advice.
In the mid 80’s, people grew accustomed in thought that coming across VC funding came easy. Not realizing it took much effort, work ethic, and a solid business plan. With little education and how VC funding really worked, as well as a recession, VC markets fell once again. Many situations caused the state to come to aide, the state tired save what was left to be saved in the crashing market of investing. For sometime VC funding was no longer a thought in the business world.
In 1999, Europe grabbed onto the Internet like everyone else. Early investors capitalized and tons of US VCs started looking at Europe to open up new VC firms or to join in on England’s already established VC firms. Come year 2000 everything began to go back downhill. A lot of ups and downs were experienced in VC firms in England. Competition increased and start-ups were tired of the dog eat dog world that became evident in their investors behaviors New investments became absent in the economy and firms began studying their investments harder and VC funding became more scarce.
What has been witnessed at the end of 1999 and the beginning of 2000 was nothing short of investors and entrepreneurs not being knowledgeable. What’s so interesting is that, Europe came to learn about Internet and NTICs much later than the US, but went sour at the same time as the US and other counterparts. Everyone came out of the wood work to get a piece of the pie. Problem is the pie wasn’t baked long enough. Everything went wrong because too many people behaved irrationally and acted to quick.
What has changed? Several trends have been at work in the VC industry in Europe. There is a lot more thought and strategy being utilized in regards to how venture capital and private equity play a part of the economy. The NVCA claims that 7.6 million jobs have been created over the last 30 years due to the shift in the market. Due to this factor alone, correction is stepping near and VC funding is in England to stay.
Posted on December 4, 2012, in Business financing, economics, the economy, VC financing, Venture Capital and tagged business financing, VC funding, Venture Capital. Bookmark the permalink. Leave a comment.