After a tumultuous 2020 for the global economy, the general and limited partners, fund administrators, consultancies, law firms, investment banks and advisers that have contributed to our annual 2021 outlook are largely upbeat about their expectations for the year ahead.
They were asked what they expect will be the key industry trends in 2021.
The announcement in November that at least three of the vaccines being developed to combat the pandemic are effective has given hope that there is light at the end of tunnel and that business life could start to get back to normal by the spring or summer.
The big unknown is the extent of economic damage that the pandemic has wrought and how long the recession will last.
Dry powder – committed but not yet called up capital – is fast approaching a record high of $5tn. According to a survey of 177 private equity fund managers in the US and Europe carried out by advisory firm Lincoln International and published last month, investors' top priority this year will be deploying that capital.
Another of the predictions for 2021 that caught our attention was from the investment platform Cathay Capital that believes that the line between venture capital and private equity will blur. The demarcation between VC growth and late-stage PE has traditionally been over technology. Cathay believes that the Covid pandemic has been the "needed push" for private equity investors to increase their understanding of the impact of technology.
"PE firms will start taking a page from the books of their more tech-focused VC brethren to learn how to get their portfolios up to speed in an increasingly digital world," Cathay predicts.
Responses collected by Elisângela Mendonça. All interviews have been edited for space and clarity. This is a selection of views from across the industry. A fuller selection appears in our print magazine this week.
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