Burgeoning populations of young, middle-class consumers in emerging markets are creating rich opportunities for venture capital investors. And that means more opportunities for venture capital jobs, as well, investing in Internet, financial services, and clean tech in these regions, reports Knowledge at Wharton.
Participants at the recent 2011 Wharton Private Equity and Venture Capital Conference discussed these new opportunities in fast-developing areas of China, India, Southeast Europe, Turkey and Latin America during various conference sessions. Among the new hot spots:
China. No surprise that this one is on the list, particularly in technology and Internet ventures. One example mentioned is Richmond Global, which has a position in AdChina, an Internet advertising company that is similar to aQuantive in Seattle, Washington.
Companies should strive to have their own managers on-site inside China, noted one executive. That way they can react faster to changes in the regional marketplace.
India. Clean tech is a prime opportunity in India, including investment in renewable resources, recycling and pollution-control equipment. India has a fast-growing economy with an exploding base of middle-class consumers. India also has the advantage of a robust public market that provides profitable exit strategies for investors. There are already groups of local angel investors providing seed capital for early-stage ventures, which venture capital firms can use as a fertile development field for future deals.
Southeastern Europe and Turkey. While this region remains fragmented and made up of several small countries, the region as a whole is in dire need of investment, particularly in financial services and distressed real estate. Executives in the region are also more willing to partner with outside firms, after suffering through the recent financial downturn.
Latin America. Clean energy, water, natural gas and sustainable agriculture lead the opportunities for venture capital firms willing to invest in Latin America. While this region may not be growing as quickly as India and China, many countries in Latin America have a young labor force and low levels of debt. In addition, the venture capital industry in Latin America is still in its nascent stage.
Do emerging markets factor into your venture capital investment or venture capital career plans? Add your comments below.
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