Barometer: outlook sunnier than expected

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IE Consulting's research for Coller Capital suggests that the impact of the private equity controversy on LPs has been limited. According to its Global Private Equity Barometer for Winter 2007-08, only one in 10 LPs reports any change of sentiment regarding private equity investments. However, LPs do expect GPs to be more cautious: 50% of LPs expect GPs to invest less money over the next 12 months, compared with less than 10% in last year's survey.

Emerging markets also draw their fair share of LP attention. Some 40% of investors invest in funds targeted at emerging markets, up from 26% two years ago. Central and Eastern Europe takes a close third place in a ranking of most attractive regions for investments in the next three years - behind India and China.

Another indication of widespread optimism is that LPs are actively seeking the GPs of tomorrow, with two-thirds willing to invest in first-time funds over the next two to three years, 'if the right opportunity presents itself'. Europe shows a healthy self-confidence: Asked whether venture capital will be as attractive in Europe as it is in North America, half of European LPs agree; only a quarter of North American LPs share that sentiment.