venture capital

BIO Releases Reports on Industry Economy, Venture Capital

In the lead-up to the Biotechnology Innovation Organization’s (BIO) International Convention held this week, the organization released a series of reports on the health of the industry. Collectively, the reports indicate that the bioscience industry is seeing greater employment with better wages, increasing venture investment, but university and federal funding, patent filings and clinical trial success are leveling off or decreasing.

VCs Throwing Caution to the Wind? VCs Invest $12.1B in Q1 of 2016

Coming off a record setting year, industry analysts contended that there would be a more cautious U.S. venture capital industry (VC) in 2016 with discussion of a VC bubble. However, in Q1 of 2016, venture capitalists invested more than $10 billion for the ninth consecutive quarter with little concern over a bubble. In total, VCs invested $12.1 billion in 969 deals in the Q1 of 2016, according to the MoneyTree Report from PricewaterhouseCoopers LLP (PwC) and the National Venture Capital Association (NVCA). At the same time, U.S. venture capital firms raised $12.0 billion for 57 funds during Q1 of 2016, making it the strongest quarter for funds raised since Q2 of 2006, according to the Fundraising Report by Thomson Reuters and NVCA. A review of the data indicates continuation of trends in where venture capital is being invested, the decline of investment in seed stage companies, and increasing corporate venture capital activity with 20.6 percent of funds invested in Q1 of 2016 coming from corporate venture capital.

Female Partners Remain Small Fraction of VC Firms

Only 8 percent of partners with the authority to invest at 2,300 micro- and venture capital (VC) firms are women (and only 7 percent of the top 100 firms), according to CrunchBase Women in Venture, a new report providing a detailed snapshot of the state of female investors and founders. The report finds of 54 corporate VC divisions and 101 accelerators, 12 percent of partners were female.

Did VC Valuations Peak in 2015? Early Numbers Indicate Return to 2013 Levels

The U.S. venture capital (VC) industry continued a gradual deflation in activity in Q1 2016, even as capital invested remained at a historically robust level according to Pitchbook’s 1Q 2016 U.S. Venture Industry Report. In Q1 2016, the VC industry also continued the trend of massive late-stage VC rounds with $9.4 billion of $17.7 billion invested in late-stage financing.

Useful Stats: Share of U.S. Venture Capital Activity and Per Capita Investment by State, 2010-2015

More than three-quarters of U.S. venture capital dollars went to companies in California, New York and Massachusetts in 2015, according to data from the PricewaterhouseCoopers (PwC)/National Venture Capital Association (NVCA) Moneytree Report. California companies received over 57 percent of all U.S. investment, about 0.5 percent down from the state’s peak in 2014. Both New York and Massachusetts received about 10 percent of U.S. dollars. Washington, the state with the fourth highest share, trailed far behind at 2.1 percent.

Useful Stats: Venture Capital Investment Per Capita by Metro, 2015

Despite a small decrease in venture capital deals last year, the San Francisco-Oakland-Fremont metropolitan area remains the most active investment regions on a per capita basis, according to data from the PricewaterhouseCoopers (PwC)/National Venture Capital Association (NVCA) MoneyTree Report. San Francisco led all other MSAs in both total dollars and per capita activity, with its $21 billion in 2015 investment averaging about $4,500 per metro resident.

Useful Stats: Venture Capital Dollars and Deals by State, 2010-2015

Last year, the venture capital investment hit a 15-year high, with total dollars topping every year since 2000. A slow fourth quarter brought the remarkable trajectory of the year back down to earth, but with a total of $11.3 billion invested, 2015 became the second highest year on record since PricewaterhouseCoopers (PwC) and the National Venture Capital Association (NVCA) began the Moneytree Report in 1995. Much of this growth was due to larger deals, and, in fact, the total number of deals was down from the previous year.

IL, NM Invest in Venture Funds to Bolster Capital Access for Startups

This week, leaders in Illinois and New Mexico announced new investments to help seed and early stage technology startups access equity capital. The Illinois Treasurer will launch the Illinois Growth and Innovation Fund, which would invest $220 million over the next three years in 15-20 funds across the state. No more than 15 percent of the money will be placed with any particular fund. The state’s investment will target emerging tech companies, beginning later this quarter.

$77.3B in Total Venture Capital Invested in 2015, Report Finds; VC Trends to Look for in 2016

Even though the total amount invested by venture capitalists (VCs) grew for the fourth straight year to nearly $77.3 invested, Pitchbook analysts contend that 2014/2015 was the peak of the VC industry for the foreseeable future. While high valuations drove up the total amount invested, the number of deals plummeted during the second half of 2015 according to new data from Pitchbook.  In addition to insights from Pitchbook, other analysts contend that the declining trends of 2015 should remain through 2016.

Academics Weigh the Benefits of Bank, VC Financing for Startups

Bank or venture capital (VC) financing? This is one of the toughest questions that aspiring entrepreneurs and small firms must answer. A recent academic study contends that VC financing may be the superior financing structure for early stage capital. However, several other studies contend that both bank and VC financing can help create and grow successful startups. For potential entrepreneurs, each provides strengths and weaknesses that are highlighted in the studies.