Michael Collins Deputy Chief Executive & Public Affairs Director at Invest Europe talks to pickingalpha.com about current situation in European Venture Capital Industry, how current and upcoming legislation is set to grow VC industry in 2016.
As the interview was filmed US Federal Reserve made a decision to raise interest rates by a .25%. Not a life stopping raise, but many would say that more is still to come and therefore in the StartUp-Venture Capital relationships one can anticipate a small initial wave of departure from the market of the very weak companies. On the other hand VCs can become more selective in their funding approach, if they will anticipate Feds to continue with the new trend of increasing interest rates.
This small change in US can give another favorable advantage in 2016 to European markets where the Central Bank is keeping historically low interest rates in order to stimulate economic activity and growth. In fact European and American interest rates are moving in opposite directions. As for now European bank interest rate (0,0500%) is set to decline further, projecting very favorable development of the European VC and StartUp environment. Tightening of US market is one more reason to pay closer attention to a rising European Start Up scene and growing with the back up of EU Venture Capital market. Watch our video for more details and insights.