Private equity 2021 summary
Private equity continues to perform well during 2021. The strength and speed of the rebound suggest resilience and continued momentum as investors increasingly look to private markets for higher potential returns in a sustained low-yield environment.
Funding in 2021 has far superseded 2020. PE/VC investment will likely remain robust in most regions of the world in 2022. Sectors such as fintech, business productivity, and health and biotech will likely continue to attract significant investment. Cybersecurity will likely also be a hot ticket for investors, given the increasing number of transactions occurring in the cloud.
The ESG (environmental social, and governance) trend is also expected to grow on the radar of investors, given the increasing importance being placed on sustainability across the business world. Already, there is increasing investment in businesses with ESG-aligned business models, such as electric vehicles and food tech. Moving forward, it is likely investments in these areas will continue to grow, while investors may also increase their scrutiny of ESG factors when making funding decisions.
Our approach to evaluating private companies is based on a data-driven methodology: catalyst events that have a positive and negative impact on the company’s performances. We use big data and NLP technologies to collect, structure, and reveal public and private companies‘ corporate events from news articles, press releases, and financial social media.
Each event is scored based on the direction (bullish/bearish) and duration (long/short term) impact on the company’s performances, scale between 0-1. (below 0.48 is considered bearish territory while above 0.52 is considered as bullish territory).
Key trends in 2021
- Across all 12 Month, Event-driven score ranged from 0.62 to 0.73. The range is in the bullish territory is the market event-driven score is 0.64.
- At 0.73, January had the highest Event-driven score and was 17.09% higher than October, which had the lowest Event-driven score at 0.62.
- Event-driven score dropped from 0.73 to 0.64 during its steepest decline between January 2021 and March 2021. This was the result of the third covid 19 wave.
- Across Event category, Cash had the most interesting recent trend and started trending up on August 2021, rising by 15.38% (0.10) in 4 months.
- Looking at sectors, Event-driven score for Sector Deep technology was trending up between February 2021 and July 2021 with a rise of 0.06 but had a significant change in trend and dropped by 0.02 starting September 2021.
- Event-driven score for Aviation started trending up on July 2021, rising by 17.15% (0.12) in 4 months.
- Event-driven score for Consumer started trending down on May 2021, falling by 3.66% (0.02) in 7 months.
- Event-driven score for Real Estate started trending up on February 2021, rising by 100.00% (0.35) in 2 months.
- Event-driven score for Sports & Gaming started trending up on February 2021, rising by 27.50% (0.14) in 2 months.
- Overall, 87% of events were bullish i.e. events that contribute to the firm’s performances in the manner of market share, revenue, valuations.
We help PE/VC investors with:
Use alternative data to identify fast-growing companies by monitoring events of a target company to make data-driven decisions: new product launch, fundraising, secondary deals, expansion to new markets, partnerships, joint venture, acquisition, management change, changes in products pricing model, regulatory decisions, financial reports, and compare the data with public-traded peers
Track portfolio companies’ corporate events to monitor their business activities and make the right adjustment to their strategy
Mapping markets by finding companies’ name using NLP in specific sectors or industries
(Views and recommendations given in this section are for research purposes only. Please consult your financial adviser before taking any position in the stock/s or currencies mentioned.) Neither First to invest. nor any of its officers, employees, representatives, agents or independent contractors are, in such capacities, licensed financial advisors, registered investment advisers or registered broker-dealers. First to invest does not provide investment or financial advice or make investment recommendations. Nothing contained in this communication constitutes a solicitation, recommendation, promotion, endorsement or offer by First to invest of any particular security, transaction or investment.)