OBSERVATIONS AND INSIGHTS




2021-10-11

WHERE ARE THE VCs?

Where in the world are the Top* Venture Capital (VC) firms? Defining top as either by number of deals, or most renowned, or by exit, we get a list of 20 VC firms with offices in one or more cities around the world.




Why is this important to know? Good question. Because investments tend to be close (geographically) to (1) where the investor has execution capabilities, (2) where there is a track record of success, and (3) where there is investment and investor infrastructure and an investment climate supporting investors' operations and goals. Why is this important? Because a value-creating VC Investor needs to have execution capabilities to turn $1 into $10 or $100 or $1000 AND be sure that they do this in a risk-friendly environment.






Looking at the Top 20 VC firms we understand that there are certain "hot-spots" around the world in terms of countries and cities, and some of these are obviously "hotter" than the others. Some of this we might have known from before, but did you know how much "hotter" Californa is compared to London among the Top 20? Californa 24 vs. England 7.




What is also interesting is that some VC Firms have made a global presence part of their strategy to source and grow companies, while others instead concentrate their effort from one or just a few offices. What conclusions can we draw from this? Is a large number of offices across the world the right strategy in terms of exit success? Difficult to say, but what is likely correct is that depending on the scope of industries and markets an investor looks at, a wide investment scope should benefit from a wider presence across many cities and countries for reasons of sourcing, scaling of portfolio companies (helping companies expand to new markets) and for optimizing exit strategies.

* Defining top as either by number of deals, or most renowned, or by exit. For sources, please see Top 10 Venture Capital Firms in 2020, Top 10 Venture Capital Firms, and These are the Top Venture Capital Firms of 2020.