Taking Stock of Venture Investing: What is the Future?

A survey distributed by Richard Frank, LAVCA Chair and CEO of Darby Overseas Investments, Ltd.

Survey results were determined from participant response at LAVCA’s 2nd Annual Policy Seminar held March 27, 2004, in Lima, Peru.

1. On a scale of 1-5, with 1 being the most critical and 5 the least, rank each of the following in terms of their constraints on the Latin American private equity and venture capital industry.

1. Difficult exit environment
2. Lack of capital
3. Lack of attractive investment opportunities
4. Other
5. Lack of skilled managers (fund and/or company)

2. On a scale of 1-5, with 1 being the most difficult and 5 the least, how would you rate each of the following as an obstacle to fund raising for Latin American private equity/venture capital?

1. Lack of compelling track record
2. The region’s political and macro-economic volatility
3. Global investor focus on other markets
4. Regulatory environment
5. Other

3. On a scale of 1-5, with 1 being the most explanatory and 5 the least, rank each of the following as causes for lackluster fund performance.

1. Lack of exit alternatives
2. Political /macro-economic volatility
3. Inexperienced fund managers/investment staff
4. Unenforceable shareholder rights
5. Other
6. High cost of corporate debt

4. On a scale of 1-5, with 1 being the best, rank each of the following investment styles.

1. Control/shared control
2. Distressed assets
3. Influential minority
4. Buy-out/MBOs
5. Passive
6. Other