2002 Annual Report - EVCA

Letter from the Chairman
Letter from the Chairman
My tenure as Chairman of the European Private Equity and Venture Capital Association
(EVCA) will end with the celebration of EVCA’s 20th Anniversary in Vienna in June. I
chaired EVCA at a time when our industry experienced dramatic changes - uncertainties
but also huge gains, business opportunities as well as human tragedies, and business and
financial losses.
I have been in this industry for approximately 15 years and in business for 25 years. It occurs to me that in
the past 25 years our financial business system has never been under so much strain as during the last 3
years. We came from a ‘new paradigm’ world characterised by strong growth, low unemployment and
continuous stock market appreciation and had to adapt to a business environment of plummeting stock
prices, recession, war, shortage of liquidity, etc. Contrary to what we would have predicted had we been
asked in 1999 - that this incredible shock and major economic downturn would have destroyed our
tightly knit business system - we are still around, doing deals, creating new companies, refinancing
existing businesses and creating value for our two stakeholders: investors and entrepreneurs.
We can be very proud of what our industry has realised over the last 20 years. From a start-up industry we
have grown to become a pan-European community with thousands of professionals in various private
equity and venture capital related disciplines investing €20-30 billion in any given year, creating
thousands of new jobs and offering exciting opportunities for our stakeholders. Although the past 3 years
have been difficult for our industry and its performance, we deserve to look beyond our achievements in
absolute terms to find that the private equity and venture capital industry has outperformed other asset
classes. This makes us confident that we are here to stay.
Over the past few years, we have seen very large private equity and venture capital players expanding and
going global, and have watched regionally focused players thriving equally. Like in any other growing
industry or company we are confronted with inherent developments, such as the need for compliance to
best practice and professional standards, increasing competition, a need for differentiation and a move to
consolidation.
EVCA as an Association and its Secretariat have developed even more rapidly than the industry to become
a professionally run trade body with a highly motivated and qualified staff. Its achievements during the
past year were only possible because of the quality of the people managing the Association and the
commitment of Members participating in the many Committees, Task Forces and Working Groups.
EVCA’s services to Members are by now renowned in the European private equity and venture capital
industry and beyond. Its yearly conferences – the International Investors Conference (Geneva, March
2003), the Annual Symposium (Vienna, June 2003) and the Technology Investment Conference (Barcelona,
October 2002) – serve as interactive discussion forums, bringing together a huge number of high-level
European and international delegates.
In response to participants’ needs, the EVCA Institute in 2002 enhanced its high-quality training and
professional development courses for early career professionals, experienced practitioners and CFOs by
requiring greater participant involvement and adding new modules.
EVCA published a number of groundbreaking papers over the last year. As a promoter of best practice and
professional standards, the Association presented its "Governing Principles and Sound Practice for the
Establishment and Management of Private Equity and Venture Capital Funds" in March of this year. This
publication was warmly welcomed by the financial community at large.
EVCA has been particularly active in research-based public affairs. With its paper "European Private Equity
and Venture Capital: Benchmarking European Tax and Legal Environments" EVCA demonstrated how the
fragmented tax and legal environments in Europe hamper the development of a truly entrepreneurial
environment and therefore require urgent attention. Research in the public affairs domain also included
the study of the impact of regulations regarding Basel-II, IAS, the EU Pension Fund Directive, the EC
Financial Services Action Plan, and the internationally ongoing discussion about valuation guidelines.
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