Asia Pacific private capital assets are expected to grow to US$6 trillion by 2025, 3½ times more than the $1.71 trillion as of September 2020, driven by venture capital, according to estimates from data provider Preqin.
This would add on to the near six-fold increase in assets over the past decade, with $133 billion of fundraising in 2020 alone, Preqin says in a report on June 17.
It says dry powder held by Asia Pacific-based private capital, excluding hedge funds, rose to a record $446 billion as of April 2021 from $416 billion in December 2020.
“Private capital is playing an increasingly important role in asset allocations across Asia Pacific, as demand to access this fast growing and diverse region remains robust,” the report says.
According to Preqin, venture capital funds are the “most prominent strategy” for private capital in Asia Pacific, holding almost 36% of total private capital assets under management based in the region.
As for individual markets, it says the private equity and venture capital industry in Greater China is “maturing fast” with total assets of $1.04 trillion, equivalent to 13% of the global total, while venture capital funds in Japan and South Korea are “gaining global prominence” as their governments encourage domestic start-ups to go global.