In terms of volume, 2019 recorded 1,037 deals, 35 per cent increase over from a year-ago period (769 deals in 2018), 60 per cent of which were in the start-up space. In terms of number of deals, start-ups recorded a 61 per cent increase in deal activity in 2019 compared to last year (378 deals in 2018).
While pure play PE/VC investments recorded a decline of three per cent, there was a significant increase in investments in the infrastructure and real estate asset classes which recorded an increase of 225 per cent and 33 per cent, respectively, on a y-o-y basis.
The year 2019 recorded the highest ever value of PE/VC investments in the infrastructure ($14.5 billion against $4.5 billion in 2018) and real estate ($6.1 billion against $4.6 billion in 2018) sectors.
For the first time, buyouts emerged as the primary PE/VC deal type, overtaking growth capital deals and accounting for 34 per cent of all PE/VC investments by value in 2019.
Buyouts recorded the largest increase of 56 per cent in terms of value ($16.2 billion in 2019 against $10.4 billion in 2018).
In the past two years, buyouts clocked $26.7 billion in deal value, which is more than the value of buyouts in the previous 12 years combined. Also, number of buyouts in 2019 (58 deals) are the highest ever. Once again, this has been driven by significant increase in the value (180 per cent increase y-o-y) and number (123 per cent increase y-o-y) of buyouts in the infrastructure and real estate sectors. Buyouts in the traditional PE/VC space, however, recorded declines in both value (26 per cent decline y-o-y) and volume (19 per cent decline y-o-y) in 2019.
Growth capital investments, at $14.5 billion, recorded modest increase of 9 per cent in 2019 against $14.2 billion in 2018. This too was primarily on account of increase in growth investments in infrastructure and real estate sectors which rose by 136 per cent ($7.3 billion in 2019 against US$3.1 billion in 2018) in terms of value and 97 per cent in terms of volume (59 deals in 2019 against 30 deals in 2018) respectively. Pure play PE/VC growth capital investments recorded a decline of 26 per cent in terms of value and 13 per cent in terms of volume.
Start-up investments in 2019 were the highest ever in terms of value and volume. 2019 recorded start-up investments worth US$7.9 billion, 22 per cent higher compared to US$6.5 billion in 2018. Softbank’s investment of US$810 million in OYO was the largest start-up investment in 2019.
There were 111 large deals (value greater than $100 million) in 2019, aggregating to $35.2 billion and accounting for 73 per cent of total PE/VC investments made in 2019 compared to 81 large deals aggregating $27.9 billion in 2018. The value and volume of large deals have been progressively increasing over the past four to five years.