According to preliminary estimates by SpainCap, obtained through the European platform EDC, private capital investment volume in Spain in 2023 reached €6.11 billion with a total of 781 investments (a decrease of 34% compared to 2022, which saw €9.23 billion invested across 960 transactions). However, despite the current macroeconomic uncertainty and the decline in other variables, fundraising maintains its dynamism.
Private Equity recorded €5.25 billion in 138 investments, reflecting a volume comparable to the 2020-2021 period with 138 operations. The Venture Capital segment closed the year with a volume of €855.2 million across 643 investments.
Oriol Pinya, President of SpainCap: ‘Despite the global economic slowdown, our industry remains optimistic, investing in new companies and their teams. The Venture Capital & Private Equity industry has demonstrated its financing capability and support for companies during previous slowdowns. We will continue to drive Spanish startups and SMEs, providing the necessary capital for a sustainable future and supporting their management teams.'
In terms of investors type, there is a sustained appetite among international firms, both in the Private Equity and Venture Capital segments, as they have abundant liquidity and a demonstrated interest in the Spanish business market. In 2023, capital from outside our borders contributed 77.3% of the total volume invested in companies in Spain. Private national fund managers, on the other hand, were responsible for 19.7% of the total volume moved and led 473 investments in Spanish companies.
In terms of investment size, a total of 9 investments exceeding €100 million concentrated 63% of the total investment volume in Spain in 2023. The middle market (operations with an equity investment between €10 million and €100 million) recorded a volume of €1.34 billion in 64 operations.
In terms of development stage, investment in buyouts stood out, with a volume of €3.29 billion across 39 deals. Regarding expansion capital (growth), 85 transactions were closed for a total amount of €939.5 million.
The sectors that attracted the highest investment and interest were Medicine/Health (27.5%), Energy and Natural Resources (25.3%), and Internet (8%). However, by the number of investments, TIC/Internet (282 operations), Medicine/Health (85), and Biotechnology (64) were notable.
Fundraising
National private investors secured €2.60 billion in fundraising, maintaining the dynamism seen in 2022 when €2.62 billion was raised.
Divestments
In 2023, divestments reached an estimated figure of €796.4 million (at cost), spread across 304 deals. The extended exit timelines for invested companies are attributed to lingering concerns in the global economic landscape. Fund managers are directing efforts toward managing invested companies and are prepared to inject the necessary liquidity to stimulate business activity, maintain investment plans, and create employment.
The most commonly used divestment mechanism, based on volume, was "Loan Redemption" (44.4%), followed by "Recognition of Losses" (19%) and "Repurchase by Shareholders" (16.4%)."
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