In June, Bigfoot Capital surveyed our capital provider network of equity investors and lenders to assess their sentiment and activity.
We released the results a couple of weeks ago (presentation link below). Here are the high-level takeaways:
1) Sentiment (next 12 months) – Negative/Neutral/Positive
– All: 90% surveyed believe a recession is coming in the next 12 months. Equity investors are breathing a sigh of relief with valuation resets and both equity and lenders are focused on quality over growth
– Equity: Seed/A investors report positive sentiment at 55% of respondents. Seed only and A/B/Growth investors are largely neutral at ~65% of respondents.
– Debt: Lenders are more negative than equity investors with 45% of no.n-bank lenders and 38% of bank lenders reporting a negative outlook
2) Strategy Shifts
– Seed Only: only 10% indicated any shift in strategy, the rest are staying their course with all maintaining a long-term mindset.
– Seed/A, A/B/Growth, Non-bank lenders: More selective, disciplined and sensitive (to burn). Bar has been raised, rewards (valuation/terms) still their for super healthy companies.
– Banks: Some cutting back on activity and tightening on structure
3) Investing Activity (YTD and next 12 months)
See charts on slides 31 and 32.
Recession be damned! 6 in 10 equity investors and non-bank lenders expect to be more active over the next 12 months. That’s 4 in 10 for banks, who largely expect to maintain the same level of activity.
