Venture Capital Report

Transcription

1 Venture Capital Report U.S. 3Q 2015

2 The following report presents Dow Jones VentureSource s quarterly findings for U.S. venture capital fundraising, investment, valuation, and liquidity. The included charts and graphs offer a comprehensive view of the trends currently affecting the venture capital market. Highlights for 3Q 2015 include: U.S. venture capital fundraising increased both in number of funds and amount invested; Venture capital investment into U.S. companies on the rise quarter-over-quarter ; Median pre-money valuation decreased 3% from 1Q 2015; Amounts raised through Initial public offerings (IPOs) went up, while mergers and acquisitions (M&As) experienced a decrease from the previous quarter. 2

3 VENTURE FUNDRAISING INCREASES IN U.S. DURING 3Q 2015 FUNDRAISING 86 funds garnered $12.9 billion in 2Q 2015, both an increase in the amount raised (51%) and increase in number of funds (23%) from the prior quarter. New Enterprise Associates 15 LP was the largest U.S. venture capital fund of 2Q 2015 raising almost $3.2 billion and accounting for 24% of the total amount raised during the quarter. Median U.S. fund size was $125 million in the first half of U.S. VC Fundraising ( ) Based on multiple closings $14.00 $12.00 $10.00 $8.00 $6.00 $4.00 $ Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Amount Raised ($B) $5.04 $3.65 $4.60 $6.80 $4.11 $5.03 $10.5 $8.33 $6.67 $8.63 $8.59 $12.9 Number of Funds $0.00 3

4 LARGEST VC FUNDS RAISED IN 3Q 2015 FUNDRAISING Firm Name Fund Name Amount ($M) City State Offering Status Fund Type Fund Category Closing Type New Enterprise Associates Inc. New Enterprise Associates 15 LP $3, Timonium MD Closed Multi-stage venture capital Venture Capital Final Institutional Venture Partners Institutional Venture Partners XV LP $1, Menlo Park CA Closed Late-stage venture capital Venture Capital Final Insight Venture Partners Insight Venture Partners IX LP $1, New York NY Open Late-stage venture capital Venture Capital First The Social+Capital Partnership Social Capital Partnership III LP $ Palo Alto CA Closed Early-stage venture capital Venture Capital Final GGV Capital GGV Capital Select LP $ Menlo Park CA Closed Early-stage venture capital Venture Capital Final 4

5 U.S. VENTURE INVESTMENT IN 3Q 2015 ON THE RISE FINANCING U.S.-based companies raised $19 billion in 1034 venture capital deals in 2Q 2015, a 15% rise in capital raised, with number of deals also experiencing an increase of 12% from the previous quarter. Compared to the same period in 2014, amount invested went up 24%, while number of deals experienced a minimal decrease. Business and Financial Services is the strongest sector with 30% share of total amount invested. $20.00 $15.00 $10.00 $5.00 Equity Financings into U.S. Based, VC-backed Companies ( ) $0.00 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Amount Raised ($B) $8.23 $9.14 $7.66 $8.87 $9.43 $9.75 $12.48 $15.44 $11.38 $17.73 $16.73 $19.19 Number of Deals

6 EQUITY FINANCINGS INTO U.S. BASED, VC BACKED COMPANIES, BY ROUND CLASS (QUARTER OVER QUARTER, ) FINANCING Number of Deals Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Restart Later Second First Seed

7 EQUITY FINANCINGS INTO U.S.-BASED, VC-BACKED COMPANIES, BY ROUND CLASS ( ) FINANCING Amount Raised ($B) $14.00 $12.00 $10.00 $8.00 $6.00 $4.00 $2.00 $0.00 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Restart $0.24 $0.69 $0.08 $0.18 $0.08 $0.11 $0.29 $0.17 $0.12 $0.13 $0.04 $0.11 Later $4.84 $4.33 $4.39 $5.00 $5.15 $5.26 $6.98 $10.13 $5.99 $11.77 $10.48 $11.62 Second $1.33 $1.40 $1.34 $1.81 $1.72 $1.93 $2.02 $2.67 $1.94 $2.79 $3.08 $3.29 First $1.46 $1.77 $1.53 $1.37 $1.62 $2.04 $1.72 $2.16 $2.04 $2.44 $2.07 $2.15 Seed $0.11 $0.09 $0.09 $0.10 $0.10 $0.09 $0.08 $0.07 $0.11 $0.06 $0.05 $0.05 7

8 EQUITY FINANCINGS INTO U.S.-BASED, VC-BACKED COMPANIES, MEDIAN DEAL SIZE ($M) ( ) FINANCING Median Equity Deal Size ($M) $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Median Equity Deal Size ($M) $3.76 $4.10 $4.00 $4.43 $3.60 $4.26 $4.10 $6.00 $5.00 $6.55 $6.35 $5.73 8

9 EQUITY FINANCINGS INTO U.S.-BASED, VC-BACKED COMPANIES, BY INDUSTRY GROUP (3Q 2015) FINANCING 3Q'15 Industry Breakdown By Number of Deals Business and Financial Services Consumer Goods Consumer Services Business and Financial Services received the largest investment allocation during 2Q 15 (30%), accumulating almost $5.8 billion through 286 deals. The figures represent a respective increase of 48% and 20% from 1Q 15. The Consumer Services placed second in terms of equity financing, taking a 24% share of all 2Q 15 investment. 197 deals drew $4.7 billion, up 8% in capital raised. Healthcare ranked third with almost $3.9 billion in 195 deals, 1% lower from the previous quarter. The sector s investment figure represents a 20% share of total equity investment into U.S. VC-backed companies for the quarter. $3.5 billion were raised by Information Technology (IT) in 273 deals, an increase of 16% in capital invested and 5% in deal flow. 3Q 15 Industry Breakdown By Amount Raised ($B) % 2% 20% 4% % 2% 24% Energy & Utilities Healthcare Industrial Goods & Materials Information Technology Business and Financial Services Consumer Goods Consumer Services Energy & Utilities Healthcare Industrial Goods & Materials Information Technology 9

10 TOP 5 DEALS INTO VC-BACKED COMPANIES (3Q 2015) FINANCING Co. Name Location Industry Group Industry Segment Industry Code Brief Description Close Date Round Type Raised ($M) Round Investors (* denotes lead) Airbnb Inc. San Francisco, CA Consumer Services Travel and Leisure Travel Arrangement/ Tourism Provider of an online marketplace for rental and short-term stay accommodations. 6/26/2015 5th $1, Baillie Gifford & Co. Ltd., China Broadband Capital Partners LP, Fidelity Investments, General Atlantic LLC*, GGV Capital, Hillhouse Capital Management Ltd.*, Horizon Ventures, Kleiner Perkins Caufield & Byers, T. Rowe Price Group Inc., Temasek Holdings Pvt. Ltd., Tiger Global Management LLC*, Wellington Management Co. LLP FourPoint Energy LLC Greenwood Village, CO Energy and Utilities Non-Renewable Energy Oil/Gas Exploration and Production Provider of energy exploration services and products. 6/30/2015 ACQ Financing $ GSO Capital Partners LP* YourPeople Inc. San Francisco, CA Business and Financial Services Business Support Services Human Resources/ Recruitment Provider of a human resources (HR) software solution. 5/1/2015 4th $ Andreessen Horowitz, Comcast Ventures, Fidelity Management & Research Co.*, Founders Fund LLC, Individual Investors, Insight Venture Partners, Institutional Venture Partners, Khosla Ventures, Sound Ventures, TPG Growth LLC* WeWork Companies Inc. New York, NY Business and Financial Services Financial Institutions and Services Real Estate Provider of shared office space. 6/24/2015 5th $ Benchmark Capital, Fidelity Management & Research Co.*, Goldman Sachs Group Inc., JPMorgan Chase & Co., T. Rowe Price Group Inc., Wellington Management Co. LLP AliphCom Inc. San Francisco, CA Information Technology Electronics and Computer Hardware Consumer Electronics Provider of mobile lifestyle innovations. 4/15/2015 Later $ BlackRock Private Equity Partners* 10

11 MOST ACTIVE INVESTORS FOR U.S.-BASED, VC-BACKED COMPANIES (3Q 2015) FINANCING New Enterprise Associates Inc. Accel Partners Andreessen Horowitz Google Ventures Intel Capital 11

12 NUMBER OF DEALS/AMOUNT RAISED BY PRIMARY REGION (3Q 2015) FINANCING Alaska/ Islands Mid-Atlantic Midwest Central Midwest East Mountain New England Northern California Pacific Northwest South Central South East Southern California Number of Deals by Primary Region 3Q Amount Raised ($B) by Primary Region 3Q 2015 $0.00 $3.70 $0.19 $0.34 $1.13 $1.45 $9.30 $0.51 $0.31 $0.60 $1.65 Number of Deals in 3Q 2015 by Primary Region Amount Raised ($B) in 3Q 2015 by Primary Region Alaska/Islands Mid-Atlantic Midwest Central Midwest East Mountain New England Northern California Pacific Northwest South Central South East Southern California Alaska/Islands Mid-Atlantic Midwest Central Midwest East Mountain New England Northern California Pacific Northwest South Central South East Southern California 12

13 NUMBER OF DEALS/AMOUNT RAISED BY SUBREGION (3Q 2015) FINANCING Number of Deals by subregion 3Q 2015 Amount Raised ($B) by subregion 3Q 2015 San Francisco Bay Area 342 $9.29 Boston Metro 97 $1.35 New York Metro 141 $2.96 Potomac 28 $0.43 Los Angeles Metro 61 $1.10 San Diego Metro 22 $0.17 Orange County 15 $0.27 Seattle Metro 34 $0.45 Austin Metro 18 $0.10 Dallas-Fort Worth 6 $0.18 Chicago Metro 18 $0.11 Subregion Breakout Number of Deals Austin Metro Boston Metro Chicago Metro Dallas-Fort Worth Los Angeles Metro New York Metro Orange County Potomac San Diego Metro San Francisco Bay Area Seattle Metro Subregion Austin Metro Breakout Boston Metro Amount Chicago Metro Raised ($B) Dallas-Fort Worth Los Angeles Metro New York Metro Orange County Potomac San Diego Metro San Francisco Bay Area Seattle Metro $0.10 $1.35 $0.11 $0.18 $1.10 $0.27 $0.43 $0.17 $ $ Number of Deals by Subregion 342 Amount Raised ($B) by $

14 EQUITY FINANCINGS INTO U.S. BASED, VC-BACKED COMPANIES, MEDIAN PRE-MONEY VALUATION VALUATIONS $80.00 Equity Financings into U.S. based, VC-backed Companies, Median Pre-money Valuation ($M) ( ) $70.00 $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Median Pre-money Valuation ($M) $29.10 $39.51 $19.00 $26.34 $18.16 $22.50 $25.75 $50.25 $35.75 $57.75 $67.14 $

15 VENTURE M&A AND IPO MARKET ACTIVITY IN THE U.S. DURING 3Q 2015 LIQUIDITY Exit Opportunities for U.S. VC backed Companies ( ) Mergers and acquisitions (M&As) of venture-backed companies dropped 16% in value from 1Q 2015, with 86 deals garnering $9.5 billion. Initial public offering (IPO) activity increased in 2Q 2015 raising $2.5 billion, up 178% from the previous quarter. 3Q'15 2Q'15 1Q'15 4Q'14 3Q'14 2Q'14 1Q'14 4Q'13 3Q'13 2Q'13 1Q'13 4Q'12 3Q' Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 IPOs M&As

16 U.S. VC-BACKED M&As ( ) LIQUIDITY U.S. VC-backed M&A Activity ( ) 86 M&As of venture-backed companies in the U.S. garnered almost $9.5 billion during 2Q In contrast with 1Q 2015, when a total of 117 transactions accumulated $11 billion, number of deals and amount raised decreased by 26% and 16% respectively. The largest M&A of the quarter was lynda.com Inc., which was acquired by LinkedIn Corp. (NYSE:LNKD) for $1.5 billion. $40.00 $35.00 $30.00 $25.00 $20.00 $15.00 $10.00 $5.00 $0.00 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Amount Paid ($B) $11.85 $8.95 $5.61 $9.32 $12.32 $14.15 $15.78 $11.14 $20.24 $34.15 $11.30 $9.48 Number of M&As

17 TOP 3 U.S. M&Ms (3Q 2015) LIQUIDITY Company Name Location Brief Description Industry Code Industry Segment Industry Group Close Date Round Type Amount Paid ($M) Acquirer lynda.com Inc. Carpinteria, CA Provider of online learning solutions. Educational/Training Media and Services Media and Content Consumer Services 5/30/2015 Acquisition $1, LinkedIn Corp. Symphony Teleca Corp. Palo Alto, CA Provider of technology-based outsourcing services. IT Consulting Business Support Services Business and Financial Services 4/09/2015 Acquisition $ Harman International Industries Inc. Applied Predictive Technologies Inc. Arlington, VA Provider of cloud-based predictive analytics software. Business Applications Software Software Information Technology 5/12/2015 Acquisition $ MasterCard Inc. 17

18 U.S. VC-BACKED IPOs ( ) LIQUIDITY U.S. VC-backed IPO Activity ( ) 27 venture-backed companies raised $2.5 billion through public offerings in 2Q Number of deals increased by 125% and capital raised more than tripled the amount from the previous quarter ($912 million). The largest IPO of the quarter was FitBit Inc. (NYSE: FIT), which completed a $732 million IPO. $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $ $0.00 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 3Q'15 Raised ($B) through IPO $0.81 $1.22 $0.64 $1.80 $2.13 $3.55 $2.94 $1.96 $1.30 $3.15 $0.91 $2.53 Number of IPOs

19 TOP 3 U.S. IPOs (3Q 2015) LIQUIDITY Company Name Location Brief Description Industry Code Industry Segment Industry Group Close Date Round Type Raised through IPO ($M) Exchange Fitbit Inc. San Francisco, CA Provider of wearable fitness devices and an online health platform. Consumer Electronics Electronics and Computer Hardware Information Technology 6/18/2015 IPO $ NYSE: FIT Etsy Inc. New York, NY Operator of an online marketplace for buying and selling handmade goods. Shopping Facilitators Consumer Information Services Consumer Services 4/16/2015 IPO $ NASDAQ: ETSY Evolent Health Inc. Arlington, VA Provider of a software platform for healthcare providers to manage a value-based care model. Healthcare Administration Software Medical Software and Information Services Healthcare 6/5/2015 IPO $ NYSE: EVH 19

20 ABOUT US Dow Jones VentureSource helps venture capitalists, corporate development executives, investment bankers and service providers find deal and partnership opportunities, perform comprehensive due diligence and examine trends in venture capital investment, fund-raising and liquidity. It provides accurate, comprehensive data on venture-backed companies including their investors and executives in every region, industry and stage of development throughout the world. The investment figures included in this release are based on aggregate findings of Dow Jones' proprietary research and are contained in VentureSource. This data was collected through surveys of professional firms, interviews with company executives, and from secondary sources. These venture capital statistics cover equity investments into early stage, innovative companies and do not include companies receiving funding solely from corporate, individual, and/or government investors. Figures contained throughout the report current at time of editorial but are subject to change without notice. No statement herein is to be construed as a recommendation to buy or sell securities or to provide investment advice. 20

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