Venture Capital Report
U.S. | 2Q | 2015
Venture Capital Report 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 2Q 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.
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Venture Capital Report
U.S. VC Fundraising (2012 – 2015) Based on multiple closings
Venture Fundraising Increases in U.S. during 2Q 2015 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 $125 million in the first half of 2015.
FUNDRAISING
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Amount Raised ($B) $6.62 $5.04 $3.65 $4.60 $6.80 $4.11 $5.03 $10.5 $8.33 $6.67 $8.63 $8.59 $12.9
Number of Funds 49 54 59 60 58 66 82 82 87 86 99 70 86
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Venture Capital Report Largest VC Funds Raised in 2Q 2015
Firm Name Fund Name Amount ($M) City State Offering Status Fund Type Fund Category Closing Type
New Enterprise Associates Inc. New Enterprise Associates 15 LP $3,150.00 Timonium MD Closed MulC-‐stage venture capital
Venture Capital Final
InsCtuConal Venture Partners InsCtuConal Venture Partners XV LP $1,400.00 Menlo Park CA Closed Late-‐stage venture
capital
Venture Capital Final
Insight Venture Partners Insight Venture Partners IX LP $1,387.96 New York NY Open Late-‐stage venture
capital
Venture Capital First
The Social+Capital Partnership Social Capital Partnership III LP $600.00 Palo Alto CA Closed Early-‐stage venture capital
Venture Capital Final
GGV Capital GGV Capital Select LP $457.00 Menlo Park CA Closed Early-‐stage venture capital
Venture Capital Final
FUNDRAISING
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Venture Capital Report
FINANCING
Equity Financings into U.S. – based, VC-backed Companies (2012 – 2015)
U.S. Venture Investment in 2Q 2015 on the Rise U.S.-based companies raised $19 billion in 1034 venture capital deals in 2Q 2015, a 15% rise in capital raised, with number of deals also experiencing an increase of 12% from the previous quarter. Compared to the same period in 2014, amount invested went up 24%, while number of deals experienced a minimal decrease. Business and Financial Services is the strongest sector with 30% share of total amount invested.
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Amount Raised ($B) $9.66 $8.23 $9.14 $7.66 $8.87 $9.43 $9.75 $12.48 $15.44 $11.38 $17.73 $16.73 $19.19
Number of Deals 1030 947 940 926 958 969 1030 975 1038 961 932 926 1034
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Venture Capital Report
Equity Financings into U.S.–based, VC–backed Companies, by Round Class (Quarter over Quarter, 2012 – 2015) Number of Deals
FINANCING
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Restart 14 11 18 7 7 8 11 8 8 9 7 6 5
Later 308 287 280 262 285 273 278 294 357 286 312 313 358
Second 183 147 161 147 202 204 212 191 224 198 188 229 234
First 362 330 319 348 310 334 381 328 348 344 337 299 358
Seed 123 123 111 125 122 110 95 107 60 84 51 50 49
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FINANCING
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Equity Financings into U.S.–based, VC–backed Companies, by Round Class (2012 – 2015) Amount Raised ($B)
2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Restart $0.16 $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 $5.44 $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 $1.67 $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 $1.99 $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 $0.10 $0.11 $0.09 $0.09 $0.10 $0.10 $0.09 $0.08 $0.07 $0.11 $0.06 $0.05 $0.05
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Venture Capital Report
FINANCING
Equity Financings into U.S.-based, VC-backed Companies, Median Deal Size ($M) (2012 – 2015) Median Equity Deal Size ($M)
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Median Equity Deal Size ($M) $4.50 $3.76 $4.10 $4.00 $4.43 $3.60 $4.26 $4.10 $6.00 $5.00 $6.55 $6.35 $5.73
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Venture Capital Report
30%
2%
24% 4%
20%
2%
18% Business and Financial Services
Consumer Goods
Consumer Services
Energy & Utilities
Healthcare
Industrial Goods & Materials
Information Technology
286
39
197 14
195
22
273
Business and Financial Services
Consumer Goods
Consumer Services
Energy & Utilities
Healthcare
Industrial Goods & Materials
Information Technology
Equity Financings into U.S.-based, VC-backed Companies, by Industry Group (2Q 2015) 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. $3.5 billion were raised by Information Technology (IT) in 273 deals, an increase of 16% in capital invested and 5% in deal flow.
2Q'15 Industry Breakdown By Number of Deals
2Q’15 Industry Breakdown By Amount Raised ($B)
FINANCING
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Venture Capital Report
Co. Name Loca@on Industry Group
Industry Segment Industry Code Brief Descrip@on 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 accommodaCons.
6/26/2015 5th $1,500.00
Baillie Gifford & Co. Ltd., China Broadband Capital Partners LP, Fidelity Investments,
General AtlanCc 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 UCliCes
Non-‐Renewable Energy
Oil/Gas ExploraCon and ProducCon
Provider of energy exploraCon services and
products. 6/30/2015 ACQ Financing $619.00 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) soiware
soluCon. 5/1/2015 4th $512.59
Andreessen Horowitz, Comcast Ventures, Fidelity Management & Research Co.*, Founders Fund LLC, Individual Investors, Insight
Venture Partners, InsCtuConal Venture Partners, Khosla Ventures, Sound Ventures,
TPG Growth LLC*
WeWork Companies Inc. New York, NY Business and Financial Services
Financial InsCtuCons and
Services Real Estate Provider of shared office
space. 6/24/2015 5th $433.90
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
InformaCon Technology
Electronics and Computer Hardware
Consumer Electronics
Provider of mobile lifestyle innovaCons.
4/15/2015 Later $300.00 BlackRock Private Equity Partners*
Top 5 Deals into VC-backed Companies (2Q 2015)
FINANCING
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Venture Capital Report
28
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New Enterprise Associates Inc.
Accel Partners Andreessen Horowitz Google Ventures Intel Capital
Most Active Investors for U.S.-based, VC-backed Companies (2Q 2015)
FINANCING
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Venture Capital Report
Amount Raised ($B) in 2Q 2015 by Primary Region
Number of Deals by Primary Region 2Q 2015 0 210 17 49 45 110 347 45 34 64 105
Alaska/ Islands Mid-Atlantic Midwest Central Midwest East Mountain New England Northern California Pacific Northwest South Central South East Southern California
Amount Raised ($B) by Primary Region 2Q 2015 $0.00 $3.70 $0.19 $0.34 $1.13 $1.45 $9.30 $0.51 $0.31 $0.60 $1.65
Alaska/Islands
Mid-Atlantic
Midwest Central
Midwest East
Mountain
New England
Northern California
Pacific Northwest
South Central
South East
Southern California
Number of Deals in 2Q 2015 by Primary Region
FINANCING
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Alaska/Islands
Mid-Atlantic
Midwest Central
Midwest East
Mountain
New England
Northern California
Pacific Northwest
South Central
South East
Southern California
Venture Capital Report
$0.45
$9.29
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$2.96
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Seattle Metro
San Francisco Bay Area
San Diego Metro
Potomac
Orange County
New York Metro
Los Angeles Metro
Dallas-Fort Worth
Chicago Metro
Boston Metro
Austin Metro
Amount Raised ($B) by subregion
Subregion Breakout Amount Raised ($B)
Number of Deals by subregion 2Q 2015
Amount Raised ($B) by subregion 2Q 2015
Subregion Breakout Number of Deals
34
342
22
28
15
141
61
6
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97
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Seattle Metro
San Francisco Bay Area
San Diego Metro
Potomac
Orange County
New York Metro
Los Angeles Metro
Dallas-Fort Worth
Chicago Metro
Boston Metro
Austin Metro
Number of Deals by Subregion
FINANCING
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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 $0.11
Venture Capital Report
VALUATIONS
Equity Financings into U.S. – based, VC-backed Companies, Median Pre-money Valuation ($M) (2012 – 2015)
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Median Pre-money Valuation ($M) $18.88 $29.10 $39.51 $19.00 $26.34 $18.16 $22.50 $25.75 $50.25 $35.75 $57.75 $67.14 $65.00
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Venture Capital Report
LIQUIDITY
Exit Opportunities for U.S. VC-backed Companies (2012 – 2015)
Venture M&A and IPO Market Activity in the U.S. during 2Q 2015 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.
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15
2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 IPOs 12 10 8 9 20 24 20 38 24 22 23 12 27
M&As 127 110 126 103 97 125 135 127 123 135 113 117 86
Venture Capital Report
U.S. VC-backed M&A Activity (2012 - 2015)
U.S. VC-backed M&As (2012-2015) 86 M&As of venture-backed companies in the U.S. garnered almost $9.5 billion during 2Q 2015. 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 $1.5 billion.
LIQUIDITY
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Amount Paid ($B) $11.83 $11.85 $8.95 $5.61 $9.32 $12.32 $14.15 $15.78 $11.14 $20.24 $34.15 $11.30 $9.48
Number of M&As 127 110 126 103 97 125 135 127 123 135 113 117 86
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Venture Capital Report Top 3 U.S. M&As (2Q 2015)
Company Name Loca@on Brief Descrip@on Industry Code Industry
Segment Industry Group Close Date Round Type Amount
Paid ($M) Acquirer
lynda.com Inc. Carpinteria, CA Provider of online learning soluCons. EducaConal/Training Media and Services Media and Content Consumer Services 5/30/2015 AcquisiCon $1,500.00 LinkedIn Corp.
Symphony Teleca Corp. Palo Alto, CA
Provider of technology-‐based outsourcing
services. IT ConsulCng Business Support
Services Business and
Financial Services 4/09/2015 AcquisiCon $780.00 Harman
InternaConal Industries Inc.
Applied PredicCve Technologies Inc. Arlington, VA
Provider of cloud-‐based predicCve analyCcs
soiware.
Business ApplicaCons Soiware Soiware InformaCon
Technology 5/12/2015 AcquisiCon $600.00 MasterCard Inc.
LIQUIDITY
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Venture Capital Report
U.S. VC-backed IPO Activity (2012 - 2015)
U.S. VC-backed IPOs (2012-2015) 27 venture-backed companies raised $2.5 billion through public offerings in 2Q 2015. 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 $732 million IPO.
LIQUIDITY
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2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2Q'15 Raised ($B) through IPO $7.75 $0.81 $1.22 $0.64 $1.80 $2.13 $3.55 $2.94 $1.96 $1.30 $3.15 $0.91 $2.53
Number of IPOs 12 10 8 9 20 24 20 38 24 22 23 12 27
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Venture Capital Report
Company Name Loca@on Brief Descrip@on Industry Code Industry Segment Industry Group Close Date Round
Type Raised through
IPO ($M) Exchange
Fitbit Inc. San Francisco, CA
Provider of wearable fitness devices and an online health
plamorm.
Consumer Electronics
Electronics and Computer Hardware
InformaCon Technology 6/18/2015 IPO $731.50 NYSE: FIT
Etsy Inc. New York, NY Operator of an online
marketplace for buying and selling handmade goods.
Shopping Facilitators Consumer InformaCon Services Consumer Services 4/16/2015 IPO $266.67
NASDAQ: ETSY
Evolent Health Inc. Arlington, VA
Provider of a soiware plamorm for healthcare
providers to manage a value-‐based care model.
Healthcare AdministraCon
Soiware
Medical Soiware and InformaCon Services Healthcare 6/5/2015 IPO $195.50 NYSE: EVH
Top 3 U.S. IPOs (2Q 2015)
LIQUIDITY
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Venture Capital Report
ABOUT US
Dow Jones VentureSource helps venture capitalists, corporate development execu@ves, investment bankers and service providers find deal and partnership opportuni@es, 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 execu@ves – 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 execu@ves, and from secondary sources. These venture capital sta@s@cs cover equity investments into early stage, innova@ve companies and do not include companies receiving funding solely from corporate, individual, and/or government investors. Figures contained throughout the report current at @me of editorial but are subject to change without no@ce. No statement herein is to be construed as a recommenda@on to buy or sell securi@es or to provide investment advice. About Dow Jones Dow Jones is a global provider of news and business informaCon, delivering content to consumers and organizaCons around the world across mulCple formats, including print, digital, mobile and live events. Dow Jones has produced unrivaled quality content for more than 125 years and today has one of the world’s largest newsgathering operaCons globally. It produces leading publicaCons and products including the flagship Wall Street Journal, America’s largest newspaper by paid circulaCon; FacCva, Barron’s, MarketWatch, Financial News, DJX, Dow Jones Risk & Compliance, Dow Jones Newswires, and Dow Jones VentureSource. MEDIA CONTACT: Rachel Manfredo 212.416.3834 [email protected]
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