Traditional Capital Raising - Colombia

The country in Colombia is expected to see the Total Capital Raised in the Traditional Capital Raising market market reach US$410.50m by 2024.
Within this market, Venture Capital is set to lead with a projected market volume of US$355.80m in 2024.
When compared globally, the United States is anticipated to generate the highest amount of Capital Raised, amounting to US$159.0bn in 2024.
Colombia's Traditional Capital Raising market is experiencing a resurgence in interest from local investors seeking long-term investment opportunities.

Definition:

The Traditional Capital Raising market relates to venture investment in startups and emerging companies that are not yet generating positive or significant revenue but have high growth potential. The capital is mostly raised from venture financial institutions, and minorly from banks.

Structure:

The market consists of two segments:
- The Venture Capital market refers to private equity funding that is offered to startups and emerging companies.
- The Venture Debt market refers to the combination between equity and debt financing, which is used to finance the early stage and growth stage capital-backed companies.
The market data comprises of the amount of capital raised, number of deals, and average deal size.

Additional information:

Although the Traditional Capital Raising market is highly competitive in investment opportunities due to the rapidly high growth rate of startups and emerging companies, it has become more popular for these businesses who cannot get traditional loans from banks, to develop and grow their businesses or projects.
Key players in this market are companies such as Sequoia Capital and Hercules Capital.

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Venture Capital
Venture Debt

Traditional bank loans
Digital capital raising

The Traditional Capital Raising market in Colombia has been experiencing significant growth in recent years, driven by various factors such as customer preferences, local special circumstances, and underlying macroeconomic factors. Customer preferences in Colombia have played a crucial role in the development of the Traditional Capital Raising market.

Investors in the country have shown a growing interest in traditional methods of raising capital, such as initial public offerings (IPOs) and debt issuance. This preference can be attributed to the perceived stability and reliability of these traditional methods, as well as the potential for higher returns compared to alternative investment options. Additionally, Colombian investors tend to have a long-term investment horizon, which aligns well with the traditional capital raising process.

Trends in the market indicate a shift towards larger and more frequent capital raising activities. Colombian companies are increasingly looking to raise substantial amounts of capital to fund their expansion plans and take advantage of growth opportunities. This trend is driven by the country's strong economic performance and the increasing presence of multinational corporations in the market.

Furthermore, there has been a rise in the number of companies going public through IPOs, indicating a growing appetite for equity investments. Local special circumstances also contribute to the development of the Traditional Capital Raising market in Colombia. The country has a well-established regulatory framework that provides a conducive environment for capital raising activities.

The Colombian Stock Exchange (BVC) plays a crucial role in facilitating the listing and trading of securities, providing companies with access to a wide pool of investors. Additionally, the government has implemented policies to promote capital market development, including tax incentives for investors and streamlined listing processes for companies. Underlying macroeconomic factors further support the growth of the Traditional Capital Raising market in Colombia.

The country has experienced sustained economic growth over the past decade, driven by factors such as increased foreign investment, infrastructure development, and a growing middle class. This economic stability and growth create an attractive environment for both domestic and international investors, who are more inclined to participate in capital raising activities. In conclusion, the Traditional Capital Raising market in Colombia is developing at a rapid pace, driven by customer preferences, local special circumstances, and underlying macroeconomic factors.

The market is witnessing a shift towards larger and more frequent capital raising activities, with a growing preference for traditional methods such as IPOs and debt issuance. The country's well-established regulatory framework, coupled with its strong economic performance, further supports the growth of the market.

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Venture capital is the term used to call the financial resources provided by investors to startup firms and small businesses that show potential for long-term growth. It has become a very important source of capital for entrepreneurs, who often have problems with financing their needs through risk-averse banks. Venture capital investments incorporate a high level of risk as only some of the VC-backed companies develop into successful and highly profitable businesses. In 2020, the leading venture capital backed company worldwide was the Manbang Group, which based in Nanjing, China.