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Useful Stats: Pre-VC Deals 2017-2018, Quarters 1-3
NVCA and PitchBook released Venture Monitor 3Q 2018 this week. The highlight data point in the report is that total U.S. venture capital investment in 2018 is on pace to break $100 billion for the year — and, in fact, to break $110 billion. At the same time, deal volume is on pace to be at the lowest level since 2012, with just 6,583 deals reported to date in 2018. With so much of the macro VC trends driven by mega deals to the latest-stage companies, we dug into the data at the earliest stages of equity investment: accelerators/incubators, angel, and seed financings.
Investors are particularly behind their 2017 pace of investment at the early end of the spectrum. Nationally, all of these pre-VC financings are down 28 percent in the first three quarters of 2018 compared to the first three quarters of 2017. Accelerator and incubator deals have particularly fallen off (down 42 percent) but activity has also slowed for angel and seed investors. See the table below for a summary of state activity and the attached spreadsheet for state-by-state details.
| Deal Stage | States with Y/Y Increase | States with Y/Y Decrease | U.S. Total Growth |
|---|---|---|---|
| Accelerator / Incubator | 7 | 41 | -42% |
| Angel | 17 | 24 | -11% |
| Seed | 9 | 30 | -22% |
| All Pre-VC | 9 | 42 | -28% |
On a per-state basis, the story is more varied. North Carolina’s accelerator/incubator activity particularly stands out for increasing from 36 to 56 deals. More states saw increased activity among angels, although Idaho, Minnesota, New York, Pennsylvania, Virginia, and Washington were the only states that had at least 10 deals in 2017 and have experienced an increase so far in 2018. Wisconsin is the only state with notably strong growth at the seed stage, with recorded investments in 2018 tripling so far from 5 to 15.
One word of caution about the 2018 data at this point: early deals are the most likely to be reported late or not at all. For example, PitchBook’s 2018 report has identified 1,200 more deals in 2017 than they were able to report at the end of the year, and a large portion of this activity appears to have occurred at the angel/seed or early-stage VC stages (as reported in the Venture Monitor). Therefore, while the overwhelming trend in the data at this point indicates a relatively slow (if valuable) year in 2018, the final count could provide a more level picture.
All data in this report is from PitchBook's venture capital data platform.
useful stats, venture capital
VC Data 2017-18 Q3.xlsx