EUROPE - Pension funds provided 43% of a considerable increase in venture capital fundraising last year, according to a new report by the European Private Equity & Venture Capital Association (EVCA).
"Independent fundraising reached €263m in 2005. Pension funds seemed to be the main source of this increase providing 43% of the total amount (some €114m)," the report states.
The second important group of capital providers was private individuals (36%), followed by banks (15%). The fundraising level in 2005 was up from a historic low of under €57m but also up from €216m in 2003.
The figures show that in 2001 pension funds had only contributed 8% to independent fundraising activities with banks having taken the major share (30%). EVCA started its research in this field in 2000 with this year's figures being derived from a survey of 99 corporate ventures.
Elsewhere, a report by Hedgeweek suggests that pension funds are also mainly responsible for a boom in hedge fund investments with London establishing itself as hedge fund capital.
"Total European industry assets reached $401bn (307) at the end of June this year, an increase of 44% from the June 2005. The asset growth came partly from the impact of fund performance, but mostly as a result of fresh capital inflows, especially from private sector and local authority pension funds," the journal reports.
It added that nearly 80% of all European hedge fund assets are in fact managed by London-based managers, according to the survey, up from 76% in mid-2005."