In what some of the more generous analysts might conclude as a turnaround year, venture capital firms did manage to capture a healthy gain, but they did so riding the shoulders of fewer IPOs while fundraising continued to stagnate. While many VC firms anticipate a better year in 2012, the job prospects in an industry heavily reliant upon an economic recovery and a more stable stock market are dim at best. That is unless you might be considering relocating to Russia, Southeast Asia or South America.
Source: www.hedgefundlounge.com/
While the economy and the markets were holding American venture capital activity in check in 2011, emerging markets in Russia, Asia and India were quietly attracting a hoard of venture capitalists intent on finding their “American” dream in other more venture friendly parts of the world. Many are uncovering Silicon Valley clones in the least likely places, such as Viet Nam, while others are zeroing in on technological hot spots such as India, China and, yes, even Russia.
Russia has become the more compelling story of late as reported in VentureBeat last year. Global firms, such as Index Ventures have begun to pour billions into an emerging “Russian Silicon Valley” which has suddenly spawned dozens of successful startups that bear striking resemblances to successful U.S. ventures, such as Groupon, Amazon, Yelp, WebMD and Facebook. But, what has VCs excited is the huge gap between the immense amount of technological talent available and their entrepreneurial capabilities, and that creates enormous opportunities for partnering.
All one has to do is overcome the sub-zero temperatures of winter and the generally corrupt government, both of which keep Muscovites and international guests on edge.
Venture activity has been increasing in India and China with companies like Blackrock moving more of their operational assets closer to the action. But, while China and India are the attracting most of the attention, it’s a smaller country that is becoming the unlikely hotspot of Southeast Asia. IDG Ventures out of Boston and Accel Partners are among a handful of firms jumping on the silicon rush happening in Hanoi and Ho Chi Minh City.
According to Forbes, the boom is mushrooming across Asia with multiple Silicon Valley’s springing up in Beijing, Shanghai and Bangalore. With more than a billion mobile service subscribers between them, it can’t come as any surprise that China and India are the world’s second and third largest VC markets.
While some may view this as a “wake-up call” for the U.S., those seeking to develop the next frontier technological innovation may want to view this as a career opportunity and brush up on their Mandarin or Russian.
