Liquidity drying up for VC firms as investments age

Singapore

THE pressure is mounting on venture capital (VC) funds to show real cash returns to investors, but as exits are delayed and market conditions remain rocky, some early VC funds might be burdened with a backlog of ageing investments.

As they look to divest their shares in portfolio companies to realise returns, fund managers will have to decide between offloading shares at a discount in the secondary market, or asking investors for more time - and they are treading a thin line because this might in turn affect their ability to fund future bets, observers said.

Funds ne…

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