Venture Capital - Panama

Panama

Highlights

The country in Panama is projected to see the Total Capital Raised in the Venture Capital market market reach US$21.56m by 2024.
Early Stage is set to dominate the market with a projected market volume of US$21.56m in 2024.
When compared globally, the United States is expected to generate the most Capital Raised with US$136.6bn in 2024.
Panama's Venture Capital market is seeing a rise in tech startups attracting foreign investments, positioning the country as a regional innovation hub.

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Venture Capital market in Panama has been experiencing significant growth in recent years, driven by a combination of customer preferences, market trends, local special circumstances, and underlying macroeconomic factors.

Customer preferences: Panamanian entrepreneurs and startups have shown a strong preference for venture capital funding as a means of financing their businesses. This preference can be attributed to several factors, including the flexibility and scalability of venture capital funding, which allows startups to access the capital they need to grow and expand their operations. Additionally, venture capital investors often provide valuable expertise and guidance to startups, helping them navigate the challenges of scaling their businesses.

Trends in the market: One of the key trends in the Venture Capital market in Panama is the increasing number of venture capital firms and funds operating in the country. This trend can be attributed to the growing interest in the Panamanian startup ecosystem, as well as the positive investment climate in the country. Venture capital firms are attracted to Panama's strategic location, stable political and economic environment, and favorable business regulations. Another trend in the market is the focus on specific sectors, such as technology, fintech, and renewable energy. These sectors have been identified as high-growth areas with significant potential for innovation and disruption. Venture capital investors are actively seeking opportunities in these sectors, providing funding to startups that are developing innovative solutions and technologies.

Local special circumstances: Panama's unique geographical location and status as a regional financial hub have contributed to the development of its Venture Capital market. The country serves as a gateway to Latin America, attracting both local and international investors who are looking to tap into the region's growing startup ecosystem. Additionally, Panama's strong legal and regulatory framework provides a stable and secure environment for venture capital investments.

Underlying macroeconomic factors: The Venture Capital market in Panama is also influenced by underlying macroeconomic factors. The country has experienced consistent economic growth in recent years, driven by sectors such as logistics, tourism, and financial services. This economic growth has created a favorable environment for startups and venture capital investments, as it has increased consumer purchasing power and created new business opportunities. Furthermore, Panama has made significant investments in infrastructure development, including the expansion of the Panama Canal and the construction of new transportation networks. These infrastructure projects have attracted foreign direct investment and stimulated economic activity, further fueling the growth of the Venture Capital market. In conclusion, the Venture Capital market in Panama is experiencing robust growth due to customer preferences for flexible and scalable financing options, market trends focused on specific sectors, local special circumstances such as Panama's strategic location and favorable business environment, and underlying macroeconomic factors including consistent economic growth and infrastructure development. As the Panamanian startup ecosystem continues to mature and attract more investment, the Venture Capital market is expected to further expand and contribute to the country's economic development.

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.