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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

Semaphore's 2021 Confidence Survey Results!

“Bubble, baby II!”

This was the comment left behind in the very last response received in our 13th annual Semaphore Confidence Survey. The comment “Bubble, baby” was my favorite economic analysis comment left a year ago. It seems some of you come back on an annual basis and remember what you said. Commentary exploded this year with pithy two-word replies and our very first emoji too vulgar to note were accompanied by nearly 500-word essays. Everyone has an opinion – you decide whether any are worthwhile. Click here for the results and you will see an expanded sampling of thoughtful commentary on matters of race, carried interest, sexual harassment, Trump, and breaking up Big Tech. Until the last day of the survey it was a see-saw race whether you believed Facebook, Google, et.al should be broken up. In the end a near landslide 57% said “tear them apart”.   You were not shy about other opinions.   The survey closed the night before the impeachment vote in the US Senate and 83% of our respondents correctly predicted Trump would not be convicted. Of course, last February 62% of you predicted he would be reelected.

COVID proved troubling as 59% reported it hurt your business with 54% believing that it would continue to do so in 2021. That said, it did not appear to hit our respondents in the pocketbook. 67% earned more in 2020 than the prior year with 21% earning less. The same 67% expect to earn still more in 2021. This follows along with the continued expression of confidence expressed in ourselves - a full 97%. This near unanimity of confidence plummets to a 54% confidence rating in the US Economy and only 37% believing one should be confident in the International economy.

One person enjoying a honeymoon is President Biden with 56% expressing confidence in the new president as compared to 69% who were not confident in his predecessor just a year ago. Even Congress has seen a boost in confidence to 20% up from 4% last year. Under the Capitol Dome, Speaker Pelosi enjoyed the confidence of 32% with new Senate Majority Leader Schumer at 30%.

Sadly, 78% agree that sexual misconduct, harassment, and gender bias remain a problem, and 68% believe inherent racism is a structural industry obstacle. The self-identified gender mix of respondents this year were 80% Male, 18% Female (up from 9% last year) and 2% choosing Gender X.

The top five states were 26% from California (supplanting NY for the first time), 20% New York, 18% Massachusetts, 6% Texas and 3% Connecticut. Washington DC, Pennsylvania, Florida, and Illinois came in each at 2% and no other state represented more than 1% (with Missouri topping Utah for first on that list).

Canada represented 21% of international respondents, 13% UK, 5% Germany, 5% China, 5% India and 2% France, Italy, and Singapore, with multiple respondents in descending order from Israel, Australia, the Philippines, Taiwan, Brazil, Russia, Japan, Columbia, Spain, Viet Nam, and single responses from 14 other nations.

Of the 620 participating this year 21% were from PE shops; 32% were VCs; 4% Hedge Funds; 9% were LPs; 11% were operating executives; 11% were Investment Bankers; and 12% were third party vendors/advisors to the industry (lawyers, accountants, etc.) – reasonably consistent with last year albeit more heavily representing VC.

A favorite comment this year was “I have encountered rapacious thieves in PE as well as some of the finest people I could ever hope to meet…”. In our baker’s dozen years that the Semaphore Confidence Survey has taken your temperature we ruefully note we have seen too many rapacious thieves given our niche taking over troubled funds. It is mercifully balanced by very many fine individuals and firms with whom we proudly enjoy working to right the misdeeds of plundering bandits.

Please keep safe, wear a mask, get jabbed in the arm so we can do it all again next year. Check out the full results and enjoy informative and sometimes entertaining opinion by clicking here.

Mark DiSalvo is the Founder and CEO of Sema4 Inc., dba Semaphore, www.sema4usa.com, a leading global professional services provider of 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 New York, London, Luxembourg, and Dallas.

 

Topics: troubled funds, equity, Semaphore, market diligence, market, business, Survey

Semaphore's 2020 Confidence Survey Results Are In!

Semaphore's 2020 Confidence Survey Highlights

“Bubble, baby!”

This was my favorite economic analysis comment in this year’s 12th Semaphore Confidence Survey. You have opinions!  In our dozen years of surveying the confidence of our industry, personal abilities, institutions and issues of the day we have never enjoyed such wide expression of viewpoint. Usually 10 or 12% leave a comment behind. This year 41% of you were motivated to give us all a piece of your minds.   Other commentary ranged from political prognostication “The Democrats will choose a candidate based on ideological purity rather than electability - setting the stage for a Corbyn-style wipeout in the election”, to a #MeToo confession “I admitted guilt in last year’s survey. Truth. I’ve not changed.”   In the outline of our results we’ve appended an extensive sampling of your viewpoints.  Enjoy the good, bad and ugly.

One thing is clear, as one of our respondent’s stated “I continue to be amazed at how damn easy it is to make money.”  Apparently it is. 72% earned more in 2019 than the prior year with only 16% earning less.  A full 69% expect to earn still more in 2020.  This follows along with the continued expression of confidence expressed in ourselves - a full 95%.  This despite a 51% confidence rating in the US Economy (up from 37% last year) and only 21% believing one should be confident in the International economy.

One person you are not confident in is President Trump. While 69% express little or no confidence, down (or is it up?) from 81% last year, fully 62% believe he will be reelected.  We have a pretty good track record in politics, predicting in 2018 the Democrats regaining the House.  93% also predicted, during the impeachment trial, that Trump would not be convicted.  How prescient you are.

Congress did not fare any better with a 72% lack of confidence rating. In the Capitol, Speaker Pelosi won the confidence head to head battle 34% to 13% with Majority Leader McConnell.

79% agree that sexual misconduct, harassment and gender bias remains an industry problem, tipping down from 88% last year, in hopes that the spotlight has afforded both recognition and changes in behavior.   Fewer self-identified females took our survey this year with a gender mix of 86% Male, 9% Female (down from 19% last year) and 5% choosing Gender X.

The top six states offering response remained 22% New York, 21%, California, 20% Massachusetts, 6% Texas and 4% Connecticut. Washington DC, Pennsylvania and Illinois came in each at 4% and no other state represented more than 1%.

Canada topped this year’s international responses with 19%,  16% UK, 6% Germany , 6% China, 5% India and 2% France and Italy with multiple respondents in descending order from  Israel, Australia, Singapore, the Philippines, Taiwan, Brazil, Russia, Japan, Columbia, Spain, Viet Nam,  and single responses from 6 other nations.

Of the record 614 participating this year 24% were from PE shops; 20% were VCs; 4% Hedge Funds; 9% were LPs; 12% were operating executives; 11% were Investment Bankers; and 20 % were third party vendors/advisors to the industry (lawyers, accountants, etc.) – reasonably consistent with last year.

One of my favorite comments was a rather direct two word reprobation of “poor survey”.  It may be true but you were no doubt engaged.   A dozen years on, the Semaphore Confidence Survey may not be very good but it does take a pretty good temperature in the moment.  We’ll all find out in the next 11 months how accurate it may be.  Count on us asking you once again next year. Please take some time away from your Master of the Universe duties and peruse the results yourself and perhaps be entertained – and informed - by many of the comments expressed about our industry, President Trump, sexual misconduct and what it all reflects about ourselves by clicking here.

Mark S. DiSalvo is the President and CEO of Sema4 Inc., dba Semaphore, www.sema4usa.com, a leading global professional services provider of troubled Private Equity, Venture Capital and Hedge funds under management. Semaphore currently holds fiduciary obligations as General Partner for nine 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 New York, London and Dallas.

 

 

Topics: Semaphore, Survey

Semaphore's 2019 Surprising Survey Responses

I’m not surprised very often.  I have to admit to being shocked by some of our results this year. This is labeled a Confidence Survey.  Other than in isolated cases (mostly about our politicians and their institutions) you have been supremely confident these past eleven annual reflections. For more than a decade the results about our national and international economy have generally been in a narrow range of reasonable confidence.  Not today.

Our respondents were only half as confident in the US national economy as the year before with just 37% expressing such as opposed to 76% last year.  More alarming is that by a factor of more than five some 41% specifically stated a lack of confidence in the economy compared to only 8% feeling negatively  a year ago.  Confidence in the International economy fared even worse with only 13% expressing confidence as opposed to 69% last year.  53% specifically noted a lack of confidence overseas compared to a 4% response last January.  Ruh roh.

Is this an early warning that compels behavior change as investors?  Maybe, seems the answer. Real Estate investment broke the top five of intended investment markets for the first time in our survey history.  Crypto/Blockchain joined the other usual leaders of software and health care in intended deal flow for 2019.

Despite impending economic doom our respondents remain confident in themselves with 93% remaining sure of their own skills backed up by 75% certain they will earn even more personal income next year than last (where  61% reported earning more last year than the 2017).  Is this simple hubris given the huge downturn in general economic confidence or are continually rising incomes for our industry compatriots just baked into the advantages of the profession? Reflect that 41% reported the Trump tax cuts advantaged their personal income while 72% said that same corporate tax policy did not influence a single judgment they made.

Speaking of Trump, there was more bad news for the president given that his lack of confidence number rose 7 points to 81%.  Politicians are by and large not very popular although Obama was an anomaly when in the past more than 70% expressed confidence in him. New Speaker Nancy Pelosi had a 41% confidence rating, almost twice as high as then Speaker Ryan last year and nearly 4 times higher than Senate Majority Leader McConnell today.   

If our survey takers know anything it is politics. A year ago you proved prescient with a super majority predicting that the Democrats would take the House.  By similarly large margin, 79% believe that the president will remain in office through the end of the year despite your lack of confidence in him and his national economic team. One commenter noted, “Lies turn into crimes and cost him taxpayer paid housing. He may earn fully paid housing in a federal prison - he at least deserves the latter.” Many equally strong opinions were expressed along with political tactics pro and con.

In this #MeToo year our industry continues to at least recognize it remains wildly deficient with 88% agreeing that sexual misconduct, harassment and gender bias is an industry problem. We even had a confession of such behavior – but while recognition is appreciated he (presumably a male) declared “I'm guilty of it. Not proud of it but trying to change my abuse of the power dynamic.  I can’t honestly promise I will succeed.”  The question continues to be left hanging is what to do about it.  One simple answer preferred was “Just be a normal human being.” This question garnered the largest response in commentary ever in the history of our survey. Many representative comments are highlighted in the accompanying documents detailing responses Click here to read.  

The distribution of respondents in the US changed from past years - the  top six states were 21%   from New York (vaulting into first place displacing California for the first time); 20% California, (down from 33%  a year ago); 19% Massachusetts; 6% Texas and 6% Connecticut; with DC, Pennsylvania and Illinois coming in at 5% each.

The UK represented 21% of international respondents (down from 31% - maybe  folks fleeing prospect of Brexit); 17% Canada; 7% Germany; 7% China; and 2% from both France and Italy, with multiple respondents  in descending order from Australia, Singapore, the Philippines, Taiwan, Brazil, Russia, Japan, Israel, Columbia,  Spain, Viet Nam and single responses from 9 other nations.

Of the record 604 respondents  who participated this year 30% were from PE shops (double last year’s number); 21% were VCs (down 10 points); 9% were LPs (down from 14% last year); 10% were operating executives; 9% were Investment Bankers; and 21 % were third party vendors/advisors to the industry (lawyers, accountants, etc.).

It’s difficult to interpret what our results really mean but the severe lack of confidence in the economy portends a potentially rough ride.  We’ll all find out in the next 11 months and you can count on us polling you once again next year. Long time readers will be amused by the return of one commenter after a few years’ hiatus who once threatened to murder his boss.  This time he makes an odd admission.  Please take some time away from the usual deal terms and spreadsheets to review and analyze the full results yourself and be entertained – and perhaps informed - by many of the comments made about sexual misconduct, President Trump, and our industry in general by clicking here.

Mark S. DiSalvo is the President and CEO of Sema4 Inc., dba Semaphore, www.sema4usa.com, a leading global professional services provider of troubled Private Equity, Venture Capital and Hedge funds under management. Semaphore currently holds fiduciary obligations as General Partner for nine  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 New York, London and Dallas.

Topics: Semaphore, Survey

The Results Are In To Semaphore's 2018 Confidence Survey!

Semaphore's 2018 Confidence Survey Highlights

Could it be possible that there be near universal confidence in the national economy, our own skills, the ability to earn more and more and hate president Trump, Congress generally and its leaders?  Well, in our Alice in Wonderland PE world, it is not only true but seems quite normal - continuing the trend expressed in last year’s survey.  Note that we also live in the real world. In this #MeToo moment our industry at least recognizes it is wildly deficient with 80% recognizing, (self-admitting?) that sexual misconduct, harassment and gender bias is an industry problem. The question left hanging is what to do about it. You obviously disagree, thankfully, with the respondent who wrote “It's being blown way out of proportion. The end result now is men will fear doing business with women.”  Many suggested that transparency was the prescription but most believing that it will only ease with a generational change in leadership and more women participants in the industry. If this survey is a guide it will take a very long time as only 14% of our 589 respondents were women. One bluntly stating, “I have had a front row seat. It is destabilizing, demoralizing, divisive and completely unacceptable behavior…” Accompanied by another comment noting, “It is an industry of big egos with little regard for others.”

Big egos indeed.  The 10th annual Semaphore Confidence Survey clearly notes we are Uber Confident (not necessarily confident in Uber but more the original meaning of that now spoiled word) with 93% confident in themselves. While some fear exigent existence, “The Dow will climb but the stock exchange will no longer exist once Trump chooses to press his Big Nuclear Button to show the world how big his…” well, you’ll have to go to the comments section to read the unexpurgated rest of the comment.  

Last year’s survey had 76% fully expecting to earn more money.  Congratulations - 73% of you did with 74% expecting to continue that upward trend this calendar year. And your personal taxes and corporate taxes will go down too, as 57% and 70% correctly predicted last year with 55% of you agreeing that the personal income tax rates will advantage you and about the same number believing the tax rate cuts will spur the national economy.

You were equally correct in that 78% predicting that the currently favorable tax treatment of Carried Interest income would not be at risk and 88% certain there will be no change in 2018, despite the fact that nearly half of you believe it should be changed.  

That confidence continues not to be shared with few other people or institutions. While President Obama fared extremely well last year (78% on the confidence scale) his successor only had a 18% confidence score, with 74% not confident.  President Trump even outscored our perennial last place finisher in the confidence polls with Congress (71% no or little confidence)  with Speaker Ryan and Senate Majority Leader “enjoyed” a 25%  and 16% confidence vote, respectively.   They won’t have to worry about those poor ratings much longer as 72% of our respondents believe that either the House or Senate become Democratic in the 2018 mid-term elections.  Makes me wonder if Nancy Pelosi and Chuck Schumer read our blogs?

For the third year in a row sectors of investment remained essentially static. Health Care, Enterprise Software, and Financial Services are #1, #2 and #3. Those three sectors remain the top three targets of investment in 2018 with Crypto Currency and Entertainment in the top 5

The distribution of respondents in the US changed only slightly from past years - the  top six states were 33% California, 22% Massachusetts, 21% New York, 6% Texas and 5% Connecticut (the last two swapping places). Washington DC, Pennsylvania and Illinois came in at 4% each.

The UK represented 31% of international respondents, 14% Canada, 7% Germany, 6% China (up from 2%), and 2% from both France and Italy, with multiple respondents from Australia, Singapore, the Philippines, Taiwan, Brazil, Russia, Japan, Peru, Spain, Viet Nam and single responses from10 other nations.

Of those who participated this year 15% were from PE shops (half last year’s number); 31% were VCs; 14% were LPs (double last year); 13% were operating executives; 7% were Investment Bankers; and 20 % were third party vendors/advisors to the industry (lawyers, accountants, etc).

I have no idea what our dog’s breakfast of results means but we’ll all find out in the next 11 months and we’ll be sure to be asking once again next year. If you can take the time away from gazing at your burgeoning net worth or from fears of political apocalypse please review and analyze the full results and read many of the comments by clicking here

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

 

Topics: Semaphore, Survey

Semaphore's 2018 Annual Survey Is Here!

Semaphore’s 2018 Confidence Survey

Professionals in our industry seek to invest in disruptive technologies and investment markets.  We all thought 2016 was a turbulent political mess. How much more disruptive was 2017? Could 2018 be even more so?  From tweets to tax cuts and sexual misconduct to crypto currency we experienced a pillar to post whipping.  How did it affect your pocket book and personal confidence?  There was absolute clairvoyance by our colleagues in last year’s survey.  Fully 70% of you predicted corporate tax rate cuts.  Another 57% predicted personal income tax cuts. It took until the last days of the year but our colleagues’ predictive powers proved accurate and prescient. A strong majority remained confident in the US and Global economies.  Only 25% had prospective confidence in President Trump in 2017. If stock market performance and political surveys can be believed you were once again fully on target, all the while believing that your incomes would continue to rise.  Our colleagues thought it would be, once again, a fat and happy year.  Was it as people expected?  Do you expect to make even more personal compensation next year than this year?

Annually we ask our readers to weigh in and share their level of confidence in themselves, the economy and their businesses. This year we ask your predictive powers on a range of issues and query directly whether sexual misconduct, harassment and gender bias is a problem in our industry.  You’ve never been shy before and we anticipate continued honest responses.

Semaphore is conducting its tenth annual survey of Private Equity and Venture Capital partners, principals and professionals supporting the industry. The purpose of this survey is to gather anonymous input from our industry friends and clients with the results fully reported to all. The survey will stay live through January.

By participating you will get to gauge your expectations with your peers, competitors and industry colleagues. The survey will take 2-3 minutes and respondent identity will not be reported to us.  Results will be published in Fortune’s Term Sheet and on our website www.sema4usa.com.   

Click here  to take the survey.

Click here  to see last year's results.

Semaphore, www.sema4usa.com, is a leading global professional services provider of troubled Private Equity, Venture Capital and Hedge funds under management. Semaphore currently holds fiduciary obligations as General Partner for nine funds, is a New Markets Tax Credit provider and advises General and Limited Partners as well as corporations around the world. Semaphore’s corporate offices are in Boston with principal offices in New York, London and Dallas.

Topics: Semaphore, Survey

The Results to Semaphore's Annual Confidence Survey Are In!

Semaphore's 2017 Semaphore Confidence Survey Highlights

All Trump. All the time. Why should the PE community be any different?   The often virulent opinion directed at the President and attendant fears about the capacity of the White House team appears to have no deleterious personal effect on our brethren.  Despite being frightened about Trump our respondents are highly secure about doing well professionally, despite their White House fears. 

The 9th annual Semaphore Confidence Survey is nothing if not entertaining and has enjoyed a reasonable level of accuracy.  While some fear goose stepping brown shirts, “So....this is what Nazi Germany felt like in the beginning.” And, with apologies to Neil Young, “Only Trump can break your heart...and the national will,” we hope neither of those comments proves true.  Last year’s survey showed a trend where, for the first time, our colleagues were reporting not only that they earned less in 2015 than the year before but that they expected their income to go down once again in 2016.  Nope.  80% reported they earned more in 2016 and fully 76% expect to continue that upward trend.  

And apparently Trump will remain good for the 1%.  Sticking to personal income, 57% believe personal income tax rates will drop in 2017 and a full 70% are certain a drop in corporate income taxes will follow.

Notwithstanding Trump’s oft repeated campaign trail pledge to end the currently favorable tax treatment of Carried Interest income only 22% believe he will fulfill that promise. If those 78% are right there is little doubt that the prediction of increased personal income, coupled with drops in corporate and personal income taxes will afford a true personal triple witching hour. No wonder 93% are confident in themselves.

That confidence is shared with few other people or institutions. While President Obama fared extremely well (78% on the confidence scale) his successor only had a 22% confidence score, with 61% not confident.  For some reason, our perennial last place finisher in the confidence polls is Congress (67% no confidence) enjoyed a 21% confidence vote which is 4 or 5 times its usual scoring.

Our respondents continue to be blunt and one of my favorite comments this year was full of industry hubris “Industry, not the president, will continue to create jobs and economic vitality in many sectors.” They present very certain opinions such as “2018 is when the wheels start coming off the bus,” while believing that “2017 will be the year of M&A/IPOs.” Hello Snapchat.

Sectors of investment remained essentially static. Health Care, Enterprise Software, and Financial Services are #1, #2 and #3 in 2016. Those three sectors remain the top three targets of investment in 2017 with Consumer Products and Entertainment breaking into the top 5

The distribution of respondents in the US changed only slightly from past years - the  top six states were 34% California, 21% Massachusetts, 19% New York, 5% Connecticut and 5% Texas. Washington DC 4%, Pennsylvania and Illinois came in at 3% and no other state represented more than 1%.

The UK represented 31% of international respondents, 15% Canada, Germany 9%, China 2% and 2% France, with multiple respondents from Australia, Singapore, the Philippines, Brazil, Russia, Japan, Peru, Spain, Viet Nam and single responses from11 other nations.

Of those who participated this year 30% were from PE shops; 26% were VCs; 7% were LPs; 9% were operating executives; 11% were Investment bankers; and 17 % were third party vendors/advisors to the industry (lawyers, accountants, etc).

Our second year of gender queries showed slightly more diversity with   81% male (89% last year) and 19% female (11% a year ago).

Last year our group overwhelming predicted the correct finalists for President even before the primary votes started.  However, Fully 83% believed Clinton would win the election. Someone I know walking the woods of Chappaqua, NY wishes our colleagues were correct…alas.

I have no better answer for my annual question of what does it all mean. We’ll find out together next year.  If you have time to tear yourself away from getting richer in the face of Armageddon please review and analyze the full results and read many of the comments by clicking here

Mark S. DiSalvo is the President and CEO of Sema4 Inc., dba Semaphore, www.sema4usa.com, a leading global professional services provider of troubled Private Equity, Venture Capital and Hedge funds under management. Semaphore currently holds fiduciary obligations as General Partner for eight 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 New York, London and Dallas.

Topics: Semaphore

No Sand Between Our Toes (2016)

Why being at the bar won’t get you a drink but will make your dermatologist smile.

I’ve been spending my summer with lawyers.  It’s not a sentence for misbehavior or because I’ve committed some wrong.  It’s not been at BBQ’s or quaffing beers with my friends at the bar (groan) telling enhanced memory college war stories while listening to the surf above the clatter of conversation. We have not even been competing at Rio inspired beach volleyball pretending each slam - if we could actually jump high enough to make one over a regulation net - was for the gold medal winning point.

Nope.  It’s been nose to the grindstone reviews of complaints and counter complaints, pleadings, filings, hearings, motions, and depositions.  And it’s been fun! Now, not the fun of an exhilarating boat ride against a swift current or being elbow deep into a great steamed lobster fest.  Rather it’s been the joy of winning a tactical position, discovering confirmation of an adversary’s transgression,  laboring under the responsibility of being fully prepared to argue your belief against some very smart colleagues, enjoying the emotional fulfillment of knowing that you are right and having someone in a black robe affirm your belief. Yeah…that may seem like a poor substitute for being at the beach but as far as alternatives go it is certainly better than, say,  Disney World in August.

This year I have relished the privilege of a deep dive in litigation esoterica and SEC regulation, welcomed as a real-world contributor to strategy, even appreciated the more than occasional 2 o’clock in the morning email exchanges, and learned that being a “good” client working with open-minded and keenly intelligent lawyers makes for more than good results.  In our troubled fund practice over the last 15 years we often spurn law firm “help” – particularly at the crisis stage of an intervention as few law firms truly understand the practitioner level consequence of the standard legal playbook on a VC or PE practice that is more medieval than modern.  The vexing engagements we have been working this year required intimate assistance and leadership of a group of attorneys who, in concert with our replacement General Partner practice team, helped secure rights lost, arrested loss of value and fixed governance of particularly dynamically challenging circumstances.  The collective efforts of the Team have given our common Limited Partner clients progress and conclusions that any one of us independently would not have been able to gain.  So here’s a toast, to my friends at the bar who, while keeping me off the beach, have kept me engaged, stirred intellectually and appreciating the fire-power a well-crafted legal and operational strategy can have when dealing with wayward General Partners and the mess they leave behind.  

Here’s hoping next year we are all scrunching sand with beer in hand telling war stories about the terribly active summer of 2016.  Meanwhile our summer labor is not over. I think my lawyer friends spent less time than I did on whatever their version of a holiday may be.  Instead we are all seemingly locked in steel and glass towers under the glow of fluorescent lights rather than risk sunburn. Other than our clients, maybe only our dermatologists applaud the consequence of our busy summer this year!

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

Topics: Venture Capital, troubled funds, equity, private equity funds, Semaphore, general partners, LP, business advisory, VC, venture funds, private equity, ethics, business

Semaphore's 2015 Confidence Survey

Semaphore's Annual Confidence Survey

Last year hundreds of you told us you hated Congress, thought the President was a failure and expected to make more cash than ever despite the denizens of Washington DC.  Feeling more confident or less confident in the President’s Economic team as we see a Republican House and Senate taking control of the Capitol? Have thoughts on your boss and competitors? Do you expect to make even more personal compensation next year than this year?   Annually we ask our readers to weigh in and share their level of confidence in themselves, the economy and their businesses.  Last year we heard significant levels of confidence – did it prove to be so? Especially as the stock market rose in a continuing bull market and reported PE/VC values (and deal costs) rose as well.

Semaphore is conducting its seventh annual survey of Private Equity and Venture Capital partners, principals and professionals supporting the industry. The purpose of this survey is to gather anonymous input from our industry friends and clients with the results fully reported to all. It will stay live until mid-January.

By participating you will get to gauge your expectations with your peers, competitors and industry colleagues. The survey will take 2-3 minutes and respondent identity will not be reported to us.  Results will be published in Term Sheet and on our website www.sema4usa.com.   We know you have opinions – share them with the world and please take the survey.

Click here  to take the survey.

Click here  to see last year's results.

Semaphore (www.sema4usa.com), is a leading global professional services provider of Private Equity and Venture Capital funds under management. Semaphore currently holds fiduciary obligations as General Partner for seven PE and VC funds, is a New Markets Tax Credit provider and advises General and Limited Partners around the world. Semaphore's corporate offices are in Boston with principal offices in New York, London and Dallas.

Topics: Semaphore

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