Evan Vitale

Accounting Professional

Evan Vitale – Latest VC Headlines

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By Evan Vitale

Here’s some of the latest venture capital news being discussed and shared online:

According to the OC Register, Irvine, California is a quite the “mecca” in Orange County when it comes to winning venture capital funds. A recent report says Irving-based companies raised more money than any of the county’s other 33 cities combined.

The Register went on to say that during the first nine months of 2015, Irving-based companies raised nearly $278 million in venture capital. Newport Beach was next in line with $57 in venture capital funds raised. The report was released by Jones Lang LaSalle Research and PricewaterhouseCoopers MoneyTree.

You can read the full article here:

http://www.ocregister.com/articles/million-698761-capital-companies.html

Recently, Indiegogo unveiled a new service that could “prove to be controversial among its core users by giving an edge to large corporations engaged in crowdfunding.”

In a blog post by the Wall Street Journal, “Goliaths have long since infiltrated crowdfunding sites, trotting out new products and promotional campaigns on platforms like Kickstarter and Indiegogo. But Indiegogo’s new Enterprise Crowdfunding service aims to help increase their chances of success on the platform.”

The blog post is here:

http://blogs.wsj.com/venturecapital/2016/01/06/indiegogo-courts-corporate-crowdfunders-with-new-services/

Monsanto Growth Ventures, the venture capital arm of the Monsanto Company announced for the first time its growing investment portfolio; nearly a dozen independent companies that are active in key areas of agricultural productivity, digital agriculture and biologicals.

StreetInsider.com has the news here:

http://www.streetinsider.com/Corporate+News/Monsanto+%28MON%29+Venture+Capital+Arm+Launches+First+Investment+Portfolio/11197249.html

From Bloomberg Business, growing peer-to-peer lending and online money transfer services helped raise a record $3.6 billion in venture capital funding for the UK technology sector last year.

The largest single investment in the industry was attracted by London-based small-business lending platform Funding Circle, which raised $150 million in April. London continues to have an expanding financial technology sector, which had a record year in 2015.

The full article is here:

http://www.bloomberg.com/news/articles/2016-01-06/u-k-tech-startups-raise-record-venture-capital-in-2015

Evan Vitale – 2016 Might Be Good For Small Business Lending

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By Evan Vitale

How are things looking in terms of small business lending in 2016?

Well, believe-it-or-not, jumps in the interest rates might also mean good news for businesses who want to seek out bank loans in the upcoming year.

You see, banks only make money when they lend money and with higher rates, banks might be more interested in ramping up their small business lending portfolio.

According to the Biz2Credit Small Business Lending Index, the percent of loans applications approved by big banks reach 22.8%, which is the highest since the recession. The recent interest rate hike makes lending to small businesses more attractive for larger banks. The Biz2Credit Small Business Lending Index believes the loan approval percentage next year could go above 25%. Remember, higher rates means more profit for lenders.

But what about other types of lending opportunities?

Institutional investors look good. During November 2015, institutional investors approved 62.4% of all loan requests.

However, alternative lenders, smaller banks and credit unions are granting loans at decreasing rates. In fact, small banks, which usually generate a large number of Small Business Association (SBA) loans, are now approving less than half of the loan applications received. In 2014, they approved more than 50% of loan applications received.

According to Forbes, community banks are struggling to compete, so many business borrowers continue to look to other sources for funding. In addition, big banks on institutional investors, which are making loans possible via an online marketplace lending platform, are able to make quicker decisions at more attractive rates and terms for business borrowers.

Some other interesting notes from Biz2Credit:

  • Almost half of all loan applications are made via mobile units.
  • Smaller banks and credit unions haven’t kept up with technological innovations and, thus, miss out on loan deals since their application process takes longer.
  • Many times, credit unions want a borrower to come to the branch office and become a member.

Evan Vitale – Alternative Small Business Lending Thriving

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By Evan Vitale

According to Business Insider, Bizfi recently announced the close of a $65 million funding round to ease the alternative lending process for small businesses by providing an aggregating plaform that helps small businesses find the best lending platform for their needs.

Bizfi facilitates some loans, but it also works with alternative lenders such as OnDeck, Funding Circle and Kabbage to pair borrowers with investors.

Some say this indicates alternative business lending is thriving. Unfortunately, most small businesses’ credit needs are not met by traditional lenders. In fact, during the first half of 2014, over half of the small businesses that applied for loans from traditional banks had their applications rejected.

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Evan Vitale is a multifaceted finance and accounting professional who provides Audit, Accounting, Tax, Due Diligence and Advisory services to Venture Capital Funds, Hedge Funds, Private Equity Funds, Family Offices, Small Business Investment Companies (SBICs), Funds of Funds, Other Investment Groups and their management companies. 

Today’s market has made it extremely difficult to predict what the next day will bring.  For Funds and Other Investment Vehicles, the expectations remain to balance the different opportunities with a continued focus on value creation in existing portfolios.  The key to any successful organization is building and maintaining the trust of your investors. Evan has the expertise to help you shine in your investor’s eyes and stand apart from the competition.

Funds have special needs when it comes to finding an accounting firm to help them with their accounting, auditing, tax and financial due diligence projects. Managing a fund is complicated enough without having to build the infrastructure to have accounting and tax services handled also. Evan helps Funds stand apart from their competition by exceeding their investor’s expectations with high quality and timely financial and tax reporting.

Connect and follow Evan Vitale on his Google+ page here: https://plus.google.com/+EvanVitale1/

Evan Vitale – Private Equity Billionaire Sponsors 300+ Kids

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By Evan Vitale

Business Insider published an interesting article recently in which a private equity billionaire sponsored 350 New York City school children AND then sent them all a personal note about their report cards.

Steve Schwarzman, also known as “King of Capital” says he got involved with the Inner-City Scholarship Fund knowing that nearly 70% of the kids are either at or below the poverty line and 90% are minorities. Schwarzman reviews each child’s report card, absent reports, etc., and then hand-writes them a personal note on his stationery.
Schwarzman and his wife, Christine, have donated over $48 million to the Inner-City Scholarship Fund since 2001.
You can read the full story here:

Evan Vitale – Top Two Private Equity Firms That Create Billionaires

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By Evan Vitale

Private equity has created many billionaires over the years, but it seems there are a few firms that do it better than others. Forbes creates its Richest Americans list each year and their latest one features many private equity executives who have made their money with leveraged buyouts. It seems last year was a really good year for private equity, which is stated by Business Insider as “the strongest since the financial crisis.” According to research firm Prequin, private equity and venture capital assets reached a new high of $3.8 trillion under management. Here are a few of the top private equity firms that have the most billionaires associated with the firm:

Apollo Global Management

This private equity firm has a few billionaires on the Forbes list, including co-founder Leon Black. He came in at #94 on the list and is worth about $5 billion. As a Wall Street legend, he’s also a well-known figure in the art market, with his most notable purchase Edvard Munch’s “The Scream.”

Another Apollo Group billionaire is co-found Joshua Harris, who owns two professional sports franchises – owning the Philadelphia 76ers and the New Jersey Devils. He came out at #268 on the Forbes list. The firm’s Marc Rowan comes in at #279 and has about $2.4 billion behind him. He put his money in his own family office thanks to his stock in the equity firm.

Carlyle Group

The other major company that churns out billionaires is the Carlyle Group and their co-founder David Rubenstein is ranked #256 on Forbes’ list. The company went public back in 2012 and started out big taking on investments out of the public eye, unlike other companies like the Apollo Group.

Another Carlyle Group billionaire is Dan D’Aniello, who is one of the three billionaires it’s created since it was first founded in 1987. He’s also at #256, along with the third co-founder of the company William “Bill” Conway.

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Evan Vitale writes and publishes another business blog at http://evanvitale.com.

Evan Vitale – 2015 Venture Capital & Private Equity Country Attractiveness Index

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Knowing when to invest and where are sometimes difficult. You have to assess which countries offer the most promising markets and which ones have the biggest entrepreneurial support. The place where you choose to invest your money has to have a strong incentive or reason to invest with protection and venture support.

The 2015 Venture Capital and Private Equity (VC/PE) Country Attractiveness Index recently released a running list from best to unfavorable countries to place investments. Of the 120 countries analyzed, the United States, the United Kingdom, Canada, Singapore, and Japan ranked at the very top. Conclusions were made based on thousands of data points and each country’s overall attractiveness to VC/PE investors. This index is not only important to investors, but regulators who can use the information provided to set new policies or revise old ones to help create a more desirable package for investors.

In addition to well established “green light” markets, private equity investors have the ability to keep an eye on emerging markets with acceptable risk to reward ratios. Current emerging markets are Mexico, Indonesia, the Philippines, Nigeria, Turkey, and South Africa. Countries like China, Russia, India, and Brazil have been in the ranks for a while now, with China leading the way as most attractive. Although investors can sometimes jump the gun, or present themselves as overly enthusiastic for emerging markets, investing in them is the only way to jump start the process and potentially reap the extraordinary reward of being an early adapter.

As for the 2015 ranking, here are the top 10 attractive investment locations:

  1. United States
  2. United Kingdom
  3. Canada
  4. Singapore
  5. Japan
  6. Hong Kong
  7. Germany
  8. Australia
  9. New Zealand
  10. Switzerland

And here are the 10 lowest ranking locations:

  1. Burkina Faso
  2. Mali
  3. Venezuela
  4. Benin
  5. Lesotho
  6. Syria
  7. Mauritania
  8. Chad
  9. Angola
  10. Burundi

For more information, be sure to check out the 2015 index here: The Venture Capital & Private Equity Country Attractiveness Index