Smart Business Magazine, Feb 2013

8 Smart Business Houston February 2013 Investment central Theres little doubt that last year saw a drop in both IPOs and venture capital investments in the U S and around the world But by years end both trends were on the rise and the outlook for this year is much improved The weakening economy unstable equity market conditions and poor performances on some IPO transactions undoubtedly impacted investors confidence explains Maria Pinelli Ernst Youngs global vice chair for strategic growth markets In the fourth quarter of 2012 29 IPOs in the U S raised a total of 73 billion while 20 IPOs in Europe raised 7 billion and 59 IPOs in the Asian markets raised 88 billion Combined the total number of IPO deals globally fell 46 percent from 255 deals in the fourth quarter of 2011 to 136 deals in the fourth quarter of 2012 But the amount of capital raised during the same period only fell 6 percent year over year Technology companies led the IPO parade followed by financial firms and industrial companies Energy companies and the materials sector ranked fourth FEATURE ERNST YOUNG CAPITAL MARKETS UPDATE Venture capital activity may be down slightly but with an expected new uptick in IPOs growth markets still aboundand fifth in the amount of capital raised This years outlook for those sectors bodes well for continued growth We believe that the real estate sector is also set to be more active due to increased investor interest ahead of a possible rebound in this sector explains Pinelli Oil and gas also looks set to become a more dynamic sector in the U S and Europe Looking ahead we expect a better outlook with a strengthening U S economy leading the recovery followed in the latter half of the year by Europe and Asia Reduced stock market volatility assertive action from central banks and brighter economic prospects suggest 2013 could be the right time for companies currently in the pipeline to list From a venture capital perspective despite a lower overall 2012 by the end of the third quarter of 2012 there was already evidence of a 17 percent increase in the amount of dollars invested and an almost 100 percent increase in the number of deals that were seen in the previous quarter For more information on IPOs or Ernst Youngs Entrepreneur Of The Year program visit www ey com GLOBAL IPO HIGHLIGHTS 2012 January November SOCIAL MEDIA Follow Ernst Young on Twitter @ EYNews