Outlook 2022: The Power of Resilience: Technology is Well Positioned for 2022 (Union Square Advisors)

Summary

• Since its founding in 2007, Union Square Advisors has advised on more than 150 transactions with total transaction value in excess of $115 billion.p.4
• TMT M&A volume for 2021 exceeded $1,037.8 billion, representing a 70% increase over 2020 volume of $611.9 billion.p.8
• SPAC IPO volumes in 2021 reached $136.6 billion, a 59% increase compared to $86.0 billion in 2020.p.8
• Traditional tech IPOs grew to 107 deals totaling $73.4 billion in 2021, compared to 71 tech IPOs totaling $45.6 billion in 2020.p.8
• Private placements recorded a strong year totaling $145.8 billion, a 31% increase over 2020 volume of $111.1 billion.p.8
• The global risk management industry totaled $7.4 billion in 2019 and is forecast to grow to $29 billion by 2027.p.12
• Venture capital and other investors poured $9.5 billion into the real estate technology sector through mid-November 2021.p.16

Key insights

1. Abundant liquidity supplied by central governments has buoyed financial markets and given VC and PE firms resources to continue funding technology innovation.p.6
2. TMT SPAC IPO volume in 2021 rose to $47.1 billion from $43.5 billion in 2020.p.8
3. Heightened regulatory scrutiny from federal agencies like the DOJ and FTC focuses on large technology mergers, cross-border deals, and Big Tech data privacy.p.10
4. The COVID-19 pandemic accelerated enterprise demand for automated governance, risk management, and compliance solutions.p.12
5. Enterprise software is projected to be the fastest-growing IT spending segment in 2022, expanding by 10.6% to reach $571 billion.p.14
6. Low-code and no-code software solutions are enabling non-technical business teams across HR, sales, and finance to customize applications efficiently.p.15
7. Predictive analytics in proptech is evolving to provide refined automated suggestions for asset selection, timing, and regional investment opportunities.p.16
8. Non-traditional tech investors like asset managers and hedge funds are projected to out-invest traditional Silicon Valley venture capitalists in private tech companies by 2022 or 2023.p.18
9. U.S. issuance of collateralized loan obligations (CLOs) broke its previous annual record by October 1, 2021.p.22
10. Private equity firms are expanding into growth equity to take minority positions early in high-growth technology and healthcare companies.p.24