Traditional Capital Raising - Hong Kong

Hong Kong

Highlights

Market definition

In-Scope/Out-of-scope

Market structure

Reports

Methodology

The Total Capital Raised in the Traditional Capital Raising market market in Hong Kong is expected to reach US$2.47bn by 2025.
Venture Capital is set to lead the market with a projected volume of US$2.07bn in 2025.
When compared globally, the United States is anticipated to generate the highest Capital Raised amount, reaching US$168.3bn by 2025.
Hong Kong's Traditional Capital Raising market is witnessing a resurgence in interest from local investors seeking stable returns amidst global economic uncertainty.

Capital Raised

Capital Raised Change

Notes: Data shown is using current exchange rates. Data shown reflects market impacts of Russia-Ukraine war and the bankruptcy of the Silicon Valley Bank.

Most recent update: Mar 2024

Source: Statista Market Insights

Capital Raised

Capital Raised Change

Notes: Data was converted from local currencies using average exchange rates of the respective year.

Most recent update: Oct 2024

Source: Statista Market Insights

Analyst Opinion

The Traditional Capital Raising Market in Hong Kong is currently facing a moderate decline, influenced by factors such as shifting investor sentiment, increasing competition from alternative funding sources, and a cautious economic outlook impacting overall investment activity.

Customer preferences: Investors in Hong Kong's Traditional Capital Raising Market are increasingly favoring sustainable and socially responsible investment opportunities, reflecting a growing awareness of environmental and social issues. This trend is driven by younger generations, who prioritize ethical considerations and are more inclined to support businesses that align with their values. Additionally, the rise of tech-savvy investors is pushing for greater transparency and digital engagement in fundraising efforts, leading to innovative approaches in capital raising that cater to their preferences for efficiency and accessibility.

Trends in the market: In Hong Kong, the Traditional Capital Raising Market is experiencing a notable shift towards sustainable investment practices, with an increasing number of investors prioritizing environmental, social, and governance (ESG) criteria in their funding decisions. This trend is significantly influenced by younger, socially conscious investors who demand alignment between their investments and ethical values. Furthermore, the integration of digital platforms is enhancing transparency and engagement, enabling more efficient fundraising processes. As these dynamics evolve, industry stakeholders must adapt to these preferences, fostering innovative funding solutions that meet the growing demand for sustainability and accessibility.

Local special circumstances: In Hong Kong, the Traditional Capital Raising Market is shaped by its unique geographical positioning and cultural values, which emphasize community and family ties. The city's proximity to mainland China provides access to a vast pool of capital and investment opportunities, while its status as a global financial hub attracts diverse international investors. Additionally, local regulatory frameworks are increasingly supportive of ESG initiatives, encouraging companies to adopt sustainable practices. This blend of cultural and regulatory influences fosters a dynamic environment where innovative funding solutions can thrive, aligning with the rising demand for responsible investment.

Underlying macroeconomic factors: The Traditional Capital Raising Market in Hong Kong is significantly influenced by macroeconomic factors such as global economic trends, national economic health, and evolving fiscal policies. The city's integration with mainland China facilitates access to substantial capital, while its robust financial infrastructure attracts international investors seeking diverse opportunities. Additionally, favorable regulatory frameworks, particularly those supporting ESG initiatives, encourage companies to pursue sustainable practices, enhancing investor confidence. Fluctuations in interest rates and inflation also play a critical role, affecting borrowing costs and investment sentiment, thereby shaping overall market performance and capital flow dynamics.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average 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), and 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. The scenario analysis is based on a Monte Carlo simulation approach generating a range of possible outcomes by creating random variations in forecasted data points, based on assumptions about potential fluctuations in future values. By running numerous simulated scenarios, the model provides an estimated distribution of results, allowing for an analysis of likely ranges and confidence intervals around the forecast.

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.

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Venture capital worldwide - statistics & facts

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.