In 2015 so far, Preqin’s Venture Deals Analyst online service has recorded 1,396 venture capital deals completed in Asia, totalling $30bn. Even though we are only seven months into the year, this total deal value is already higher than any annual aggregate value prior to 2015, with the previous record total value witnessed in 2014 when 1,754 venture capital financings in Asia amounted to an aggregate deal value of $22bn. This substantial increase in the aggregate total deal value of Asia-based venture capital deals can be largely attributed to a surge in the number of large cap ($100mn+) venture capital investments in Asia. As seen in the chart below, there were nine such deals in 2012, 14 in 2013, 47 in 2014 and already 66 so far this year. These 66 deals account for $20bn in deal value, or 67% of the total value of Asian venture capital deals in 2015 YTD. In 2014, large cap deals accounted for 54% of the value, while in 2009 such deals recorded the lowest proportionate contribution to the total at 10%.
Taking a closer look at Asia, Greater China accounts for 74% of the number of all large cap venture capital transactions completed in Asia since 2007, far greater than the 17% in South Asia, 5% in ASEAN and 4% in Northeast Asia. Aggregate deal value for the same set of transactions shows that Greater China also contributed the largest proportion (75%), followed by 18% in South Asia, 4% in Northeast Asia and 3% in ASEAN. It is unsurprising, therefore, that the largest venture capital deal in 2015 YTD was an investment in a China-based firm. Didi Kuaidi, a provider of a mobile application for booking taxis and created as a result of the merger between Kuaidi Dache and Didi Dache, announced in July 2015 that it had raised $2bn in a new round of financing. Alibaba, Ping An, Temasek Holdings, Capital International Private Equity Fund and Tencent Holdings were among the investors.
Similar to the trends seen globally, the internet and telecoms industries dominate the large cap deals in Asia. In 2015 YTD, investments in the internet and telecoms industries respectively accounted for 59% and 21% of the number of deals, and 57% and 28% of the aggregate deal value of such deals in Asia.
As troubles continue to grow in China’s stock market, venture capital investments have been increasing in 2015. Of the 66 large cap investments in Asia so far this year, 49 were made in China-based companies; this equates to a 158% increase on the 19 large cap deals seen in China in the corresponding period last year. Outside China, the proportionate increase was even greater, at 240%, from five large cap deals in 2014 to 17 in 2015 YTD.