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 2014 include:
- U.S. venture capital fundraising amount raised and number of funds on decline from 1Q 2014; Venture capital investment was at its highest since 1Q 2001;
- Median pre-money valuation totaled $58M, more than double the valuation figure for 1Q 2014;
- Amount raised and transactions on decline for both venture-backed mergers and acquisitions (M&As) and Initial public offerings (IPOs).
Highlights for 2Q 2014 include:
- U.S. venture capital fundraising amount raised and number of funds on decline from 1Q 2014; Venture capital investment was at its highest since 1Q 2001;
- Median pre-money valuation totaled $58M, more than double the valuation figure for 1Q 2014;
- Amount raised and transactions on decline for both venture-backed mergers and acquisitions (M&As) and Initial public offerings (IPOs).
FUNDRAISING
Venture Fundraising in U.S. on decline from 1Q 2014
76 funds garnered $7.4 billion in 2Q 2014, down 28% from the amount raised in the previous quarter. Number
of funds also experienced a 5% decrease.
Tiger Global Private Investment Partners VIII LP was the largest U.S. venture capital fund of 2Q 2014 raising $1.5 billion and accounting for 20% of the total amount raised during the quarter.
Median U.S. fund size was $172 million in the first half of 2014.
Tiger Global Private Investment Partners VIII LP was the largest U.S. venture capital fund of 2Q 2014 raising $1.5 billion and accounting for 20% of the total amount raised during the quarter.
Median U.S. fund size was $172 million in the first half of 2014.
FINANCING
U.S. Venture Investment on the Rise in 2Q 2014
U.S.-based companies raised $13.8 billion from 917 venture capital deals during 2Q 2014, a 21% and 4%
increase both in capital and deal count from the previous quarter.
Compared to the same period in 2013, amount invested registered a 60% increase, while number of deals dipped 2%.
Consumer Services and Business and Financial Services were the strongest sectors, respectively with 28% and 24% share of total amount invested.
Compared to the same period in 2013, amount invested registered a 60% increase, while number of deals dipped 2%.
Consumer Services and Business and Financial Services were the strongest sectors, respectively with 28% and 24% share of total amount invested.
Equity Financings into U.S.-based, VC-backed Companies, by Industry Group (2Q 2014)
Consumer Services saw the largest investment allocation, with 171 deals garnering almost $3.9 billion and accounting for 28% of total equity investment.
The Business and Financial Services sector raised the second highest proportion of investment for 2Q’14 - $3.3 billion into 242 deals, up 4% and 9% in dollars and deals, respectively, from 1Q’14 figures.
IT and Healthcare shared third position. IT decreased 13% quarter over quarter, with $3 billion invested in 236 deals, a 4% drop also for the number of deals. The sector’s investment figure represents a 22% share of total equity investment into U.S. VC-backed companies for the quarter.
Healthcare companies raised $3 billion across 201 deals, a 33% and 18% increase compared to the previous quarter.
Consumer Services saw the largest investment allocation, with 171 deals garnering almost $3.9 billion and accounting for 28% of total equity investment.
The Business and Financial Services sector raised the second highest proportion of investment for 2Q’14 - $3.3 billion into 242 deals, up 4% and 9% in dollars and deals, respectively, from 1Q’14 figures.
IT and Healthcare shared third position. IT decreased 13% quarter over quarter, with $3 billion invested in 236 deals, a 4% drop also for the number of deals. The sector’s investment figure represents a 22% share of total equity investment into U.S. VC-backed companies for the quarter.
Healthcare companies raised $3 billion across 201 deals, a 33% and 18% increase compared to the previous quarter.
LIQUIDITY
Venture M&A and IPO Market Activity in the U.S. during 2Q 2014
Mergers and acquisitions (M&As) of venture-backed companies in 2Q 2014 decreased by 26% in value from
those completed in 1Q 2014, with 108 deals garnering $12.6 billion.
25 venture-backed IPOs took place during 2Q 2014, a 34% decrease from the previous quarter.
25 venture-backed IPOs took place during 2Q 2014, a 34% decrease from the previous quarter.
U.S. VC-backed M&A
108 M&As of venture-backed companies in U.S. garnered $12.6 billion during 2Q 2014.
In contrast with 1Q 2014, when a total of 128 transactions accumulated almost $17 billion, both number of M&As and amount raised fell by 16% and 26% respectively.
The largest M&A of the quarter was Oculus VR Inc., which was acquired by Facebook Inc. (Nasdaq: FB) for $2 billion.
In contrast with 1Q 2014, when a total of 128 transactions accumulated almost $17 billion, both number of M&As and amount raised fell by 16% and 26% respectively.
The largest M&A of the quarter was Oculus VR Inc., which was acquired by Facebook Inc. (Nasdaq: FB) for $2 billion.
U.S. VC-backed IPOs
25 venture-backed companies raised almost $2.2 billion through public offerings in 2Q 2014. Number of deals decreased by 34% and capital raised also registered a 26% decrease from the previous quarter.
The largest IPO of the quarter was GoPro Inc. (NASDAQ:GPRO), which completed a $427 million IPO.
25 venture-backed companies raised almost $2.2 billion through public offerings in 2Q 2014. Number of deals decreased by 34% and capital raised also registered a 26% decrease from the previous quarter.
The largest IPO of the quarter was GoPro Inc. (NASDAQ:GPRO), which completed a $427 million IPO.
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