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VC Investment Strategies Shift With Tech and Social Change

Photo by Mathieu Stern / Unsplash

Lisbon, Portugal - The PitchBook and Web Summit investor survey, conducted at a major technology conference in Lisbon, has gathered data from 111 global venture capital investors. 

The findings indicate a shift in investor focus towards artificial intelligence (AI), environmental considerations, and gender representation in the tech industry.

AI and ML

  • AI and ML Preference: 62.2% of investors view AI and machine learning as the most potentially disruptive technologies, up from 29% the previous year.
  • AI in Investment Analysis: Approximately 30% of investors now use AI in evaluating investment opportunities.

Environmental Impact on Investment Decisions

  • Investor Stance on Environments: 63.1% of investors avoid investing in companies with negative environmental impacts.

Women's Representation in Venture Capital

  • Status of Gender Representation: There is a reported increase in women's representation in firms and portfolio companies by 43.2% of investors. However, women in senior management roles declined from 75% to 66.7% year-over-year.
  • Investments in Women-led Startups: 58.6% of investors have funded women-led startups in the past 18 months, a decrease from prior periods.

Venture Capital Market Dynamics

  • Decrease in Global Venture Capital: Investment has reduced globally, with $247.2 billion invested through the third quarter, compared to $439.9 billion in the same period in 2022.
  • Fundraising Challenges: Nearly 50% of investors expect difficulties raising funds from Limited Partners in the upcoming year.

  • Focus on Climate Tech and HealthTech: After AI/ML, climate and healthcare technology are gaining investor interest.
  • Geopolitical Events and Investment Decisions: Most investors report that geopolitical developments and interest rate increases have minimal impact on their investment strategies, contrasting with the previous year's cautious stance.

The 2023 investor survey indicates an evolving tech investment landscape, increasingly influenced by developments in AI and environmental concerns, amidst ongoing challenges in gender representation and market volatility. 

These findings provide insights into tech investments' present state and likely future direction.