Last year’s sluggish economy went hand in hand with a sharp drop in investment activity, with the value of capital investments falling by 35%. This came alongside a 10% decline in transaction volumes compared with the year before.
The NZ Private Capital Monitor shows there were 276 transactions last year, totalling $2.5 billion in combined private equity and venture capital investments and divestments. This is down from $3.77 billion in 2024.
The decline was largely driven by fewer and smaller large private equity deals. In 2025, there were three major transactions worth a combined $541 million, compared with three deals totalling $1.66 billion in 2024.
Total weighted investment activity made up around 71% of all 2025 transactions, reaching $1.78 billion. That’s a 35% drop compared with 2024’s total invested amount of $2.77 billion. Meanwhile, divestments also declined, falling 27% to $723.6 million.
Despite the overall decline, mid-market deals grew in both size and number, while venture capital investment reached record levels.
“If you look at the trend, particularly if you look at the venture capital trend that’s been on a steady progressive increase over the last decade, that’s a very positive trend in the mid-market; that market has been steady and continues to grow as well,” NZ Private Capital executive director Colin McKinnon explained.
“So the trend is positive, we’re doing good work, we’re growing good companies, and they’re internationally relevant companies that we’re growing; it’s a lot to be positive about.”
Mid-market activity also picked up, with the number of transactions rising 85% to 50 deals. Their total value edged up to $549 million, compared with $519 million in 2024.
Venture and early-stage investment reached a record $687 million, up 17% from $587.6 million in 2024. Much of this funding was directed toward IT, software, and other technology companies.
The outlook for the next six months remains neutral due to ongoing global macroeconomic conditions, although McKinnon noted that optimism is expected to improve in the years ahead.
“Recent global geopolitical events were not reflected in survey responses; however, this activity will undoubtedly have an ongoing impact on financial market risk in the near to medium term, the extent of which is yet to be seen.”