VC deal volume in APAC recovered in March 2020, but big ticket deals mostly non-existent, finds GlobalData

Venture capital (VC) investment activity in the Asia-Pacific (APAC) region showcased some signs of recovery during the end of COVID-19 hit first quarter (Q1) of 2020. However, big ticket deals remained mostly non-existent with low value deals (investment <=US$10m) continuing to account for the majority of the VC investment volume during the quarter, according to GlobalData, a leading data and analytics company.

An analysis of GlobalData’s Financial Deals Database reveals that VC investment volume (with disclosed deal value) decreased from 227 in January to 219 in February before rebounding to 291 in March, primarily due to decline in new COVID-19 cases and easing of lockdown in China during March.

Aurojyoti Bose, Lead Analyst at GlobalData, comments: “Despite the recovery towards the end of Q1, Q2 is likely to be a rough quarter with several media reports indicating at a second wave of the virus hitting China. April 2020 also failed to maintain the momentum set during the previous month with deal volume mostly remaining flat.”

The share of low value deals as a percentage of the total deal volume was more than 60% in Q1 2020. In contrast, the share of deals valued more than US$100m stood at 2.3% while the share of billion-dollar deals (investment >=US$1000m) stood at just 0.14%.

Out of the total 227 deals announced in January 2020, low value deals as a percentage of the total deal volume stood at 68.3%. The share of deals valued more than US$100m stood at 1.8% while the month did not witness the announcement of any billion-dollar deal.

Deal volume declined by 3.5% in February 2020 compared to the previous month. The share of low value deals as a percentage of the total deal volume also declined and stood at 65.8%. The share of deals valued more than US$100m stood at 1.8% while the month also did not witness the announcement of any billion-dollar deal.

March reversed the decline witnessed during previous month with deal volume growing by 32.9%. The share of low value deals as a percentage of the total deal volume stood at 67%. The month witnessed the highest number of deals valued more than US$100m among all the three months with the corresponding share standing at 3.1%. March was also the only month to witness billion-dollar deals (such as US$1.2bn raised by Go-Jek and US$1bn raised by Yuanfudao).

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