According to research from Sifted, CVC investment into European startups has fallen sharply in 2023.
Olav Ostin, TempoCap’s Managing Partner is quoted in this piece, articulating that the decline should be contextualised within the huge hike of CVC investing across the last decade.
“In the seven years to 2021, CVCs multiplied by 10x their investment in the asset class,” says Ostin. “They just went bananas on the asset class, which no one expected.” In Q1 2022 they continued to be very aggressive, he says, but have since pulled back sharply amid the larger market decline.
The recessionary environment won’t be the only factor, Ostin says, but it will play a part. “Normally every five to seven years they will sell,” he says. “The first reason is that the corporate needs some cash. If we have a recession, they’ll look at selling.”
Read More: Sifted
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