VentureSource U.S. -- 1Q 2014

Transcription

1 U.S. -- 1Q 2014

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 1Q 2014 include: U.S. venture capital fundraising doubles in amount raised from last quarter, but number of funds remains level; Venture capital investment was at its highest since 1Q 2001; Median pre-money valuation increased 59% from 4Q 2014; Venture-backed mergers and acquisitions (M&As) reach highest quarterly figure since 3Q Initial public offerings (IPOs), however, took a dip. 2

3 Venture Fundraising in U.S. Rises Significantly from 4Q 2013 FUNDRAISING 73 funds garnered $9.6 billion in 1Q 2014, more than doubling the amount raised in the previous quarter, while number of funds remained stable. Technology Crossover Ventures VIII LP was the largest U.S. venture capital fund of 1Q 2014 raising $2.2 billion and accounting for 23% of the total amount raised during the quarter. Median U.S. fund size was $175 million. U.S. VC Fundraising ( ) Based on multiple closings $12.00 $10.00 $ $ $4.00 $ Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Amount Raised ($B) $7.12 $3.59 $2.92 $6.75 $7.45 $6.57 $5.03 $2.93 $4.56 $6.75 $4.07 $4.77 $9.64 Number of Funds $0.00 3

4 Largest VC Funds Raised in 1Q 2014 FUNDRAISING Firm Name Fund Name Amount ($M) City State Offering Status Fund Type Fund Category Closing Type TCMI Inc. Technology Crossover Ventures VIII LP $2, Palo Alto CA Closed Late-stage venture capital Venture Capital Final Andreessen Horowitz Andreessen Horowitz Fund IV LP $1, Palo Alto CA Closed Multi-stage venture capital Venture Capital Final Founders Fund Management LLC Founders Fund V LP $1, San Francisco CA Closed Multi-stage venture capital Venture Capital Final Accel Partners Accel Growth Fund III LP $1, Palo Alto CA Closed Late-stage venture capital Venture Capital Final Lightspeed Venture Partners Lightspeed Venture Partners X LP $1, Menlo Park CA Closed Multi-stage venture capital Venture Capital Final 4

5 FINANCING U.S. Venture Investment on the Rise in 1Q 2014 U.S.-based companies raised $10.7 billion from 862 venture capital deals in 1Q 2014, a 18% increase in capital and a 10% decline in number of deals from the previous quarter. In contrast with 1Q 13, amount invested registered a 44% increase, while number of deals dipped 3%. Information Technology (IT) and Business and Financial Services are the strongest sectors, respectively with 32% and 25% share of total amount invested. Equity Financings into U.S. based, VC-backed Companies ( ) $12.00 $ $ $ $ $ $0.00 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Amount Raised ($B) $8.13 $9.19 $10.68 $8.16 $7.51 $9.32 $7.81 $8.96 $7.48 $8.50 $9.18 $9.10 $10.74 Number of Deals

6 FINANCING Equity Financings into U.S. based, VC backed Companies, by Round Class ( ) Number of Deals Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Restart Later Second First Seed

7 FINANCING Equity Financings into U.S. based, VC backed Companies, by Round Class ( ) Amount Raised ($B) $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Restart $0.09 $0.40 $0.23 $0.08 $0.09 $0.16 $0.23 $0.68 $0.08 $0.17 $0.08 $0.22 $0.29 Later $4.89 $4.67 $5.95 $4.73 $4.13 $5.11 $4.60 $4.37 $4.39 $4.89 $4.75 $5.04 $5.79 Second $1.45 $1.90 $1.97 $1.54 $1.01 $1.56 $1.27 $1.43 $1.25 $1.69 $2.05 $1.79 $1.75 First $1.30 $1.56 $2.10 $1.44 $1.41 $2.07 $1.38 $1.53 $1.53 $1.30 $1.45 $1.69 $1.44 Seed $0.07 $0.10 $0.12 $0.10 $0.10 $0.09 $0.09 $0.08 $0.06 $0.08 $0.08 $0.05 $0.05 7

8 FINANCING Equity Financings into U.S.-based, VC-backed Companies, Median Deal Size ($M) ( ) Median Equity Deal Size ($M) $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Median Equity Deal Size ($M) $4.40 $5.00 $5.26 $4.00 $3.88 $4.70 $3.84 $4.27 $4.00 $5.00 $4.00 $4.15 $4.50 8

9 FINANCING Equity Financings into U.S.-based, VC-backed Companies, by Industry Group (1Q 2014) IT saw the largest investment allocation, with 246 deals garnering $3.4 billion and accounting for 32% of total equity investment. The Business and Financial Services sector raised the second highest proportion of investment for 1Q 14: 210 deals accumulated $2.6 billion, up 15% in amount raised, but down 7% from respective 4Q 13 figures. Healthcare placed third with $2.3 billion in 171 deals, a 1% drop from the previous quarter. The sector s investment figure represents a 21% share of total equity investment into U.S. VC-backed companies for the quarter. $1.8 billion were raised by Consumer Services in 158 deals, a decrease of 15% in deal flow, while capital invested went up by 10%. 1Q'14 Industry Breakdown By Number of Deals 1Q 14 Industry Breakdown By Amount Raised ($B) Business and Financial Services Consumer Goods Consumer Services 32% 24% Business and Financial Services Consumer Goods Consumer Services Energy & Utilities 2% Energy & Utilities Healthcare Industrial Goods & Materials Information Technology 1% 21% 3% 17% Healthcare Industrial Goods & Materials Information Technology 9

10 Top 5 Deals into VC-backed Companies (1Q 2014) FINANCING Co. Name Location Industry Group Industry Segment Industry Code Brief Description Close Date Round Type Raised ($M) Round Investors (* denotes lead) Cloudera Inc. Palo Alto, CA Information Technology Software Database Software Provider of open source database software. 3/31/2014 Corporate $ Intel* Lyft Inc. AliphCom Inc. San Francisco, CA San Francisco, CA Consumer Services Information Technology Travel and Leisure Electronics and Computer Hardware Travel Arrangement/ Tourism Consumer Electronics Provider of an on-demand ridesharing service platform. Provider of audio and speech technologies and consumer products for the mobile communications markets. 3/10/ th $ /13/2014 Later $ Alibaba Group, Andreessen Horowitz, Coatue Management LLC, Founders Fund Management LLC, Mayfield Fund, Third Point Reinsurance Ltd. Rizvi Traverse Management LLC* TangoMe Inc. Mountain View, CA Information Technology Software Communications Software Provider of mobile video communication and messaging applications. 3/20/2014 Corporate $ Alibaba Group* Intarcia Therapeutics Inc. Boston, MA Healthcare Biopharmaceuticals Biotechnology Therapeutics Developer of therapeutic products for diseases that require long-term chronic treatment. 3/27/2014 r4th $ Farallon Capital Management LLC, Foresite Capital Management LLC, Franklin Resources Inc., New Leaf Venture Partners, Quilvest Ventures, RA Capital Management LLC* 10

11 FINANCING Most Active Investors for U.S.-based, VC-backed Companies (1Q 2014) New Enterprise Associates 500 Startups LP Khosla Ventures Google Ventures Kleiner Perkins Caufield & Byers 11

12 FINANCING Number of Deals by Primary Region 1Q 2014 Amount Raised ($B) by Primary Region 1Q 2014 Alaska/ Islands Mid-Atlantic Midwest Central Midwest East Mountain New England Northern California Pacific Northwest South Central South East Southern California $0.004 $1.28 $0.12 $0.24 $0.31 $1.26 $5.68 $0.16 $0.32 $0.29 $0.67 Number of Deals in 1Q 2014 by Primary Region Amount Raised ($B) in 1Q 2014 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 FINANCING Number of Deals by subregion 1Q 2014 Amount Raised ($B) by subregion 1Q 2014 San Francisco Bay Area 320 $5.67 Boston Metro 69 $1.23 New York Metro 95 $0.93 Potomac 38 $0.18 Los Angeles Metro 31 $0.21 San Diego Metro 20 $0.20 Orange County 16 $0.19 Seattle Metro 22 $0.11 Austin Metro 18 $0.21 Dallas-Fort Worth 9 $0.08 Chicago Metro 11 $0.13 Subregion Breakout Number of Deals Subregion Breakout Amount Raised ($B) Number of Deals by Subregion Amount Raised ($B) by Subregion San Francisco Bay Area Boston Metro New York Metro Potomac Los Angeles Metro San Diego Metro Orange County Seattle Metro Austin Metro Dallas-Fort Worth Chicago Metro San Francisco Bay Area Boston Metro New York Metro Potomac Los Angeles Metro San Diego Metro Orange County Seattle Metro Austin Metro Dallas-Fort Worth Chicago Metro $0.18 $0.21 $0.20 $0.19 $0.11 $0.21 $0.08 $0.13 $0.93 $1.23 $

14 VALUATIONS Equity Financings into U.S. based, VC-backed Companies, Median Pre-money Valuation ($M) ( ) $45.00 $40.00 $35.00 $30.00 $25.00 $20.00 $15.00 $10.00 $5.00 $0.00 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Median Pre-money Valuation ($M) $20.27 $22.25 $28.50 $18.26 $18.05 $15.00 $29.88 $40.00 $10.49 $24.20 $17.00 $22.00 $

15 LIQUIDITY Venture M&A and IPO Market Activity in the U.S. during 1Q 2014 Mergers and acquisitions (M&As) of venture-backed companies decreased by 2% from 4Q 2013, with 119 deals garnering $17 billion. 38 venture-backed IPOs took place during 1Q 2014, the highest figure in a quarter since 3Q 2000 when 75 were completed. Exit Opportunities for U.S. VC-backed Companies ( ) 1Q'14 4Q'13 3Q'13 2Q'13 1Q'13 4Q'12 3Q'12 2Q'12 1Q'12 4Q'11 3Q'11 2Q'11 1Q' Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 IPOs M&As

16 LIQUIDITY U.S. VC-backed M&As ( ) 119 M&As of venture-backed companies in U.S. garnered $17 billion during 1Q 2014, the highest quarterly figure since 3Q 2000, when $23 billion were raised. In contrast with 4Q 2013, when a total of 122 transactions accumulated $12 billion, though the number of M&As fell by 2%, the amount raised rose by 37%. The largest M&A of the quarter was Nest Labs Inc., which was acquired by Google Inc. (Nasdaq: GOOG) for $3.2 billion. U.S. VC-backed M&A Activity ( ) $18.00 $16.00 $14.00 $12.00 $10.00 $8.00 $6.00 $4.00 $2.00 $0.00 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Amount Paid ($B) $11.74 $11.79 $13.55 $9.48 $10.46 $12.00 $11.70 $8.82 $5.47 $8.95 $10.74 $12.45 $17.07 Number of M&As

17 Top 3 U.S. M&As (1Q 2014) LIQUIDITY Company Name Location Brief Description Industry Code Industry Segment Industry Group Close Date Round Type Amount Paid ($M) Acquirer Nest Labs Inc. Palo Alto, CA Manufacturer of energy efficient home products, such as thermostats and smoke alarms. Appliances/Durable Household Goods Household and Office Goods Consumer Goods 2/7/2014 Acquisition $3, Google Inc. AutoTrader.com Inc. Atlanta, GA Provider of a digital automotive marketplace. Procurement/Supply Chain Business Support Services Business and Financial Services 1/3/2014 Acquisition $1, Cox Enterprises Mandiant Corp. Alexandria, VA Developer of threat detection and response security software and services. Network/Systems Management Software Software Information Technology 1/2/2014 Acquisition $1, FireEye Inc. 17

18 LIQUIDITY U.S. VC-backed IPOs ( ) 38 venture-backed companies raised $2.9 billion through public offerings in 1Q Number of deals increased by 90%, while capital raised registered a 17% decrease from the previous quarter. The largest IPO of the quarter was Castlight Health Inc. (NYSE: CSLT), which completed a $178 million IPO. U.S. VC-backed IPO Activity ( ) $9.00 $8.00 $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 1Q'11 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 Raised ($B) through IPO $0.77 $1.71 $0.43 $2.37 $1.42 $7.75 $0.81 $1.22 $0.64 $1.80 $2.22 $3.55 $2.94 Number of IPOs

19 Top 3 U.S. IPOs (1Q 2014) LIQUIDITY Company Name Location Brief Description Industry Code Industry Segment Industry Group Close Date Round Type Raised through IPO ($M) Exchange Castlight Health Inc. San Francisco, CA Provider of cloud-based software that attempts to help enterprises manage health care costs. Clinical Decision Support Medical Software and Information Services Healthcare 3/14/2014 IPO $ NYSE: CSLT Coupons.com Inc. Mountain View, CA Provider of digital coupons. Advertising/Marketing Business Support Services Business and Financial Services 3/7/2014 IPO $ NYSE: COUP Acucela Inc. Seattle, WA Developer of therapeutics to treat and slow the progression of sightthreatening ophthalmic diseases. Biotechnology Therapeutics Biopharmaceuticals Healthcare 2/13/2014 IPO $ TSE: M 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. About Dow Jones Dow Jones & Company is a global provider of news and business information, delivering content to consumers and organizations via newspapers, Web sites, apps, video, newsletters, magazines, proprietary databases, conferences, and radio. Dow Jones has produced unrivalled quality content for over 120 years and today has one of the world s largest news-gathering operations with nearly 2,000 journalists in more than 80 bureaus, including The Wall Street Journal, America s largest newspaper by paid circulation. Other premier brands include Barron s, MarketWatch, DJX and Factiva. Dow Jones publishes in 13 languages and distributes content in 28 languages, combining technology with news and data to support business decision making. The company pioneered the first successful paid online news site and its industry leading innovation enables it to serve customers wherever they may be, via the Web, mobile devices, Internet-connected televisions, and tablets. MEDIA CONTACT: Erin Carpenter-Maier Erin.Maier@dowjones.com 20