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Semaphore's 2024 Confidence Results Revealed

Discover the latest insights from Semaphore's 2024 Confidence Survey

"I’ve got to admit it; it‘s getting better, a little better all the time (can't get much worse).”

With apologies to the Beatles that their music could belie our industry, this lyric came in a comment to our 16th Annual Semaphore Confidence Survey and seemed to summarize the entirety of the record responses received. Our respondents, while recognizing challenges, were decidedly optimistic about themselves, the state of the industry, their ability to deal with inherent problems, and rather certain that incomes would continue to climb.

Four overriding observations deserve note. First, women respondents more than doubled to 25%. Total participation exceeded 1400 responses, double last year and the largest number we have ever experienced. Artificial Intelligence is anticipated to capture the largest investment market share in 2024, far and away the hottest industry sector. Lastly, despite dismal lack of confidence in the Biden administration, over the three weeks the survey remained open, the expectation of whether the President would be reelected grew from 30% in the initial week to 46% at the end - mirroring recent political polls. Someone else with a higher pay grade than me can analyze whether and how all these connect.

The commentary remained enlightening and entertaining. Please conduct your own review and analysis of our audience opinion and whether you abide by them. Click here for the survey results and a representative sampling of commentary on matters of the industry, race, carried interest, sexual harassment, breaking up Big Tech, and whether Sam Altman should be running Open AI – 78% say yes with comments ranging from “He’s a genius” to “He’s a fraud”.

Results intrigued as usual with definitive confidence in yourselves (82%) and a 4X increase in the economy just twelve months ago (40% have confidence today in the US and 12% International), with a single digit 1% confidence in the US Congress. President Biden confidence rating held steady at just 24% with 58% expressing a lack of no confidence in US national tax and spending policies.

For the first time, less than a majority, 47% of you, earned more in 2023 than the prior year, while 58% expect to do so this year. This is a bounce back in confidence as last year we reported the lowest numbers of increased income expectation ever recorded.

Surprisingly, 56% do not support elimination of carried interest rates compared to 70% last year, with 44% apparently agreeing with one commenter that “Greed is not good”.

Our respondents don’t wish to have Big Tech broken up (72%), believe that sexual misconduct, harassment, and gender bias remains a problem (68%), both virtually the same numbers as last year. 51%, a slightly smaller majority than last year at 55%, believe inherent racism is a structural industry obstacle.

Respondents were from 25 states with California, Massachusetts and New York making up 59% of the US response. 38 other countries were represented with 37% of international respondents from Canada, UK and Germany (36% last year).

Males represented 74%, 25% Females and, 1% self-reported Gender X of those participating this year. 9% of you were from PE shops (way down from 24% last year); 34% were VCs; 3% Hedge Funds; 13% LPs; 10% operating executives; 9% Investment Bankers; and 22% third party vendors/advisors to the industry (lawyers, accountants, etc.) – the last two categories were double last year’s proportion.

Back to the Beatles – the song noted is “Getting Better” on the Sgt. Pepper’s album. The initial idea for the song's title came from a phrase often spoken by Jimmie Nicol, the group's stand-in drummer for the Australian leg of their 1964 world tour when he replaced Ringo who was ill. Take a listen https://www.youtube.com/watch?v=EGlo9LzmOME – here’s hoping things do get better all the time.

Check out the complete results and engaging opinion by clicking here.

Mark DiSalvo is Founder and CEO of Sema4 Inc., dba Semaphore, www.sema4usa.com, a leading global professional services provider to troubled Private Equity, Venture Capital and Hedge funds under management. Semaphore currently holds fiduciary obligations as General Partner for fourteen funds, is a New Markets Tax Credit provider, and advises Limited Partners around the world. Semaphore’s corporate offices are in Boston with offices in Barcelona, Dallas, London, Luxembourg, New York, and Washington DC.

 

Topics: Venture Capital, equity, private equity funds, Semaphore, limited partners, turnaround, technology, diligence, small businesses, growth equity investments, market, analysis, venture funds, private equity, ethics, ethical standards, business, Survey

Semaphore's 2022 Confidence Survey Results Are In!

“Remember in March/April of 2020 we thought every fund portfolio would crash? The joke is on others not smart enough to be in our biz - not even a global pandemic can kill us.”

That was the first comment entered in the 14th Annual Semaphore Confidence Survey. It might just be true, given the stratospheric amounts of capital committed and invested accompanied by the continuing rising incomes of those taking our survey.

Commentary continued to explode – hundreds of your colleagues penned opinions – many thoughtful and some cringing to read. You can decide for yourself. Click here for the survey results and a representative sampling of commentary on matters of race, carried interest, sexual harassment, breaking up Big Tech, COVID, and the Theranos/Holmes saga. Many comments are truly delicious – how come none of you are as pithy and entertaining on my Zoom calls?

COVID proved not as troubling as expected with only 34% reporting it hurt your business while 54% of you predicted that it would in 2022. Only a third of you think it will hurt in 2022.   It most certainly did not hurt your wallets as 77% earned more in 2021 than the prior year, and 65% expect to earn still more in 2022. Unsurprising, considering that 91% of you had full confidence in yourselves. Curiously, this confidence in self plummets to a 35% confidence rating in the US Economy and only 19% with a confident outlook of the international economy compared to 54% and 37% respectively expressing confidence last year.

The honeymoon for President Biden is evidently over. His confidence rating was cut in half from with 56% last year to 27% today. Could it be because many of our respondents fear a tax hike those in our industry doing so extraordinarily well? As one stated about eliminating Carried Interest “I benefit from it - but it is wrong,” balanced by some believing that “Tax breaks for (the) wealthiest citizens must be revisited.”

66% agree that sexual misconduct, harassment and gender bias remain a problem, down from 78% a year ago.   A majority of 54% believe inherent racism is a structural industry obstacle, down from 68%. The self-identified gender mix of respondents this year were 74% Male, 24% Female (up from 18% last year and 9% the year prior), and 2% choosing Gender X.

The top five survey taking states were 22% California, 20% New York, 19% Massachusetts, 7% Texas, and Connecticut. Washington DC, Pennsylvania, Florida, Colorado and Illinois came in at 2% each and no other state represented more than 1%.

Canada represented 17% of international respondents, 15% UK, 8% Germany, 7% China, 6% India and 3% France, Italy, Israel, and Singapore, 2% Brazil, Mexico and Australia. Respondents in descending order of submissions were from Japan, Taiwan, Sweden, Russia, Spain, Luxembourg, Philippines, Columbia, Viet Nam, Nigeria, with responses from 19 other nations.

Of the 579 participants this year 22% were from PE shops; 27% were VCs; 7% Hedge Funds; 9% LPs; 14% operating executives; 7% Investment Bankers; and 14% third party vendors/advisors to the industry (lawyers, accountants, etc.).

52% of survey takers believed the Theranos/Holmes saga was an outlier in our industry against 48% believing it more systemic. The most passionate of commentary was in response to this question including “Theranos is the tip of the iceberg - there are hundreds of VC funded startups that are illegitimate fake hacks,” and “Hubris is always in fashion.”   We’ll be sure to poll the scandal of the moment next year.

Here is hope your supreme self-confidence somehow rubs off on the world economy and we come out of these still parlous times safe, healthier, and by all accounts, richer in both wealth and fulfilment. Check out the complete results and engaging opinion by clicking here.

Mark DiSalvo is Founder and CEO of Sema4 Inc., dba Semaphore, www.sema4usa.com, a leading global professional services provider to troubled Private Equity, Venture Capital and Hedge funds under management. Semaphore currently holds fiduciary obligations as General Partner for eleven funds, is a New Markets Tax Credit provider, and advises Limited Partners around the world. Semaphore’s corporate offices are in Boston with principal offices in Barcelona, Dallas, London, Luxembourg, and New York.

Topics: Venture Capital, private equity funds, Semaphore, general partners, limited partners, investment, growth equity investments, private equity, Corporate Growth Planning, business, Survey

1 of 4 - The Most Important Thing You Don't Know About Market Due Diligence

Posted by Jon Klein of The Topline Strategy Group on Wednesday, June 2, 2010 @ 9:00AM 

Blog Series: 1 of 4

When it comes to venture capital and growth equity investments, the bottom line is the top line. If a company can grow its revenue, then odds are it will generate a strong return for its investors. Market due diligence is a key component of determining the growth prospects, and therefore the return prospects, of an investment. However, the tried and true methods of market due diligence typically leave out one of the most important elements of measuring the opportunity - Pipeline Interviews.

In our experience, Pipeline Interviews - interviews with accounts that fell out of the pipeline without making a purchase - are rarely conducted during a market due diligence effort.  However, they provide vital insight into the true market potential of the company, a perspective that cannot be gained elsewhere. To understand why, we have created a series of blogs to explore the subject.  Next time we will  by looking at what is typically included in a market due diligence effort.

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This article was contributed by Jon Klein. Jon is the founder and general partner of The Topline Strategy Group, a strategy consulting and market research firm specializing in emerging technologies. Jon brings a unique blend of strategy consulting and hands on operating experience to The Topline Strategy Group and works closely with Semaphore on a variety of engagements.

To read the full White Paper, please go to Semaphore News and click on the May 3, 2010 link titled - White Paper - Market Due Diligence

Topics: Venture Capital, due diligence, diligence, market diligence, growth equity investments, Pipeline Interviews

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