Data on VC Investments

Goals

To obtain aggregated, macro data for seriec C funding that reveals the average returns for VC in the later stages of investments (specifically, series C stage and above), the average time to exit (i.e., sell off the company or launch an IPO), and how companies typically increase in value after their series C funding.


Early Findings

PItchbook Spreadsheets

  • Pitchbook has extensive data pertaining to Q3 2019. In the spreadsheets they include late stage funding (stage C and beyond) and exits.
  • A PDF file explaining the data may be viewed here.

2019 Year to Date Statistics

  • Total VC deal value has reached $96.7 billion through the first three quarters of 2019, which puts the year on pace to be the second highest in terms of venture capital investment behind last year’s record totals. Despite some high-profile hiccups in the exit market, total exit value for 2019 is already at an all-time high of more than $200 billion with a quarter still to go. Fewer VC funds are being closed, but 15 mega-funds have been raised YTD and more are on the horizon, laying the foundation for strong VC activity in the coming quarters.

2019 2nd Quarter Late-Stage Venture & Technology Growth Deals

  • Crunchbase projects that there was a total of $38.25 billion in combined late-stage and technology growth (private equity transactions raised by previously VC-backed companies) dollar volume across 641 deals.
  • U.S. and Canadian startups accounted for 50.9 percent of the combined late-stage and tech growth dollar volume in Q2 2019, up from 31.8 percent in Q2 2018. The resurgence in North American latter-stage venture dollar volume primarily comes at the expense of Chinese startups, which were many of the most-funded companies from quarters past are headquartered.

2019 3rd Quarter Late-Stage Venture & Technology Growth Details

  • Crunchbase projects that, worldwide, $75.6 billion was invested across 9,100 venture capital deals in Q3 2019.
  • Deal volume is growing faster outside North America. In Q3 2019, U.S. and Canadian companies netted 39.2 percent of venture deal volume across all stages, according to Crunchbase data and projections. That’s compared to 43 percent in Q3 2018. Although the shift is small, it results from a fairly consistent trend.
  • Crunchbase projects that, combined, $43.37 billion was invested across 653 late-stage and technology growth deals in Q3 2019.
  • Late-stage and technology growth deals are fewer in number than early-stage deals but much larger in size. Late-stage deals—Series C, Series D, and beyond, plus a high-dollar subset of other equity funding types—and private equity deals raised by previously venture-backed companies (which Crunchbase calls “technology growth” rounds) account for just 7.2 percent of deal volume, but 57.4 percent of total dollar volume.
  • Average late-stage deal size in Q3 2019 is up 8.3 on a sequential quarterly basis, but grew by only 2.5 percent compared to the same time last year. Again, when dealing with smaller sample sizes with high variance, outliers can skew averages by a significant margin. Median deal size is the metric which shows that late-stage venture is a market gone sideways. Median late-stage deal size is unchanged on a quarterly basis, and up just 3 percent relative to the same period last year.
  • Software companies are seeing strong exits through IPOs.
  • Q3 2019 venture-backed M&A deal volume clocked in at 326 reported transactions, down 14.2 percent. This marks the largest QoQ M&A deal volume decline in at least three years.
  • Q3 2019 presented something of a turning point in the IPO market. Companies with robust fundamentals and a narrative which suggests continued growth did fairly well. Others, with “visionary” founders and specious claims about “elevating consciousness” and “selling happiness” didn’t fare so well.

Notable Global IPOs Of Venture Backed Companies in q3 2019

  • Smile Direct Club- $1.3B, 9/12/2019
  • Peleton- $1.16B, 9/25/2019
  • Doyou TV- $775M, 7/17/2019
  • Datadog- $648M. 9/19/2019
  • Cloudfare- $525M, 9/12/2019
  • TRANSSION- $400M, 9/25/2019
  • 1-X Genomics- $390M, 9/11/2019
  • Here we see a real stratification in the IPO market. On the one hand, technology companies with strong economics, a profitable business (or a clear path to profitability), reasonable prospects for growth, and a stable management team have done fairly well when raising from public markets. Datadog, for example, priced its IPO at $27 and opened at $40.35 in its first trades as a public company. At time of writing, its shares trade at $37.
  • For companies with more faith-based valuations, not so much. WeWork is definitely the most conspicuous flop of the quarter, but other ventures with lofty private market valuations also stumbled out of the gate. Interactive fitness firm Peloton and its underwriters set an IPO share price of $29, but its shares closed out day one of public-market trading at $25.76. At time of writing, Peloton shares trade below $24.
  • Series C Funding for Healthcare- Q3 2019 may be viewed here.

Proposed next steps:

You need to be the project owner to select a next step.