Gartner Research

Impact From the VC Slowdown: Who Stands to Win or Lose?

Published: 16 August 2016

ID: G00304420

Analyst(s): Bianca Granetto, Hai Swinehart , Moutusi Sau

Summary

The number of venture capital investment deals has fallen to post-2008 levels, dropping the last three quarters, with the potential for further correction. Strategic planners must explore opportunities for mergers and acquisitions, or different areas of funding in this volatile environment.

Table Of Contents
  • Impacts

Analysis

  • Market Volatility Prompts Investor Conservatism
  • IT Investment Outlook
    • VC firms Are Slowing Investments, but Focusing on Areas Such as Artificial Intelligence
    • Corporate Venture Capital Units Are Funding Strategic Important Companies Adhering to the Units' Goals
    • VC Firms Are Focusing on Disruptive/Transformative Technologies
  • What Is Being Funded
    • Prospects Exist in Machine Learning and Artificial Intelligence Companies
  • What Is Not Being funded
    • Cloud Security, Identity Management and Security Analytics Are Facing Funding Shortfalls

Impacts and Recommendations

  • Despite the general slowdown, strategic planners approach CVC units that are still funding companies that are of strategic importance to their own organizational goals
  • Strategic planners should note that VC firms are continuing to focus, despite the funding crunch, on disruptive/transformative technologies such as leveraging digital technology for economies of scale
  • Despite a downturn in VC funding, there are opportunities for strategic planners in machine learning and artificial intelligence companies

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