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The latest in VC: Ripple effects of record capital availability

W E B I N A R

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Cameron Stanfill

Analyst

2Q 2018 Venture Monitor Report

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U S F U N D R A I S I N GP O L L

In your opinion, what is the most important driver of increased allocation to Venture?

aA

B

C

D

Return characteristics

Diversification benefit

Increased maturity of VC market

Access to companies earlier in the lifecycle

E Other

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Half-decade landmark in sightUS fundraising activity by year 8

Funds of $500M+ raised

through first 6 months

$85BDry Powder in the US

(as of 9/30/17)

*Data as of 6-30-2018

$32

$12

$20

$26$24

$21

$36 $37$41

$35

$20

193

124

156

155

208

227

297 295

322

283

157

-

50

100

150

200

250

300

350

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*

Capital Raised ($B) # of Funds Closed

6

$57.5BInvested in first half, on

pace to top $100B.

227%Increase in early-stage

median deal size over

the past decade

$37.1

$27.0$31.3

$44.4$41.7

$47.4

$71.9

$82.2

$75.6

$81.9

$57.5

4,716

4,470

5,388

6,738

7,865

9,244

10,50910,606

8,9398,815

3,997

0

2,000

4,000

6,000

8,000

10,000

12,000

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Deal Value ($B) # of Deals Closed

Capital invested paces for decade-highUS deal activity by year

Late stage valuations continue to soarMedian pre-money valuation by series

24%YoY growth of valuation

at Series D+

*Data as of 6-30-2018

7

20

55

115

278

$0

$50

$100

$150

$200

$250

$300

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*

Angel/Seed Series A Series B Series C Series D+

225

80

40

15.9

6

8

Defined: Non-traditional investor

• PE/Buyout

• Corporation

• Sovereign Wealth Fund

• Family Office

• Hedge Fund

• Mutual Fund

• Limited Partner

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$17.4

$11.1 $11.8

$19.8

$16.0$18.7

$36.5

$46.1

$42.5 $43.6

$35.8

1,192

840 875

1,015

1,205

1,410

1,690

1,839

1,634 1,560

886

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Deal Value ($B) # of Deals Closed

22%Non-traditional Investor

deal participation

Non-traditional investors increase participationDeal activity by non-traditional investors

62%recorded deal value

*Data as of 6-30-2018

$16.2 $16.3

$30.6$33.8

$46.0

$36.8

$79.8

$50.4

$59.2$54.0

$28.7

484 482

697738

869 893

1,0731,012

879 853

419

0

200

400

600

800

1,000

1,200

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*

Exit Value ($B) # of Exits Closed

Outsized exits drive healthy first halfUS exit activity by year

43completed IPOs in

first half

$28.7Bcapital exited

through 6/30

*Data as of 6-30-2018

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IPO window begins to open

5.9 5.6

6.96.3

7.77.4

3.0

4.0

5.0

6.0

7.0

8.0

9.0

2010 2011 2012 2013 2014 2015 2016 2017 2018*

Acquisition IPO Buyout

*Data as of 6-30-2018

Median time to exit

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U S F U N D R A I S I N GP O L L

Over the rest of 2018, what will have the largest effect on VC deal activity & capital investment?

aA

B

C

D

VC fundraising and dry powder

Increased participation from non-traditional investors

Deal/check sizes

Valuations

E Other

Panel discussion• Activity of Non-Traditional Investors

• Evolution of Exits Throughout Venture

Kevin Swan VP, Corporate Development, Solium

At Solium, Kevin is responsible for driving growth via

acquisitions, new business creation and strategic initiatives.

Before Solium, he was a partner at a $500M VC firm and then

transitioned to lead corporate development for one of his

portfolio companies in San Francisco, helping the company

grow to a billion-dollar valuation.

Buddy Arnheim Co-chair, Emerging Companies & Venture

Capital Practice, Perkins Coie

Buddy represents emerging growth companies, venture

capital funds, other early stage participants and more. He is

widely referenced for his experience in the areas of corporate

and securities law, governance matters and industries such as

robotics, autonomous machines, AI and machine learning.

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Jim Marshall Head of Emerging Manager Practice,

Silicon Valley Bank

Jim has been working in the startup ecosystem in Silicon

Valley for over 20 years and has been with Silicon Valley Bank

since 2012. As Head of the Emerging Manager Practice at

SVB, Jim leads a team that provides general partners with

tailored services and strategic guidance—from fundraising

and fund operations to portfolio company support and

creative liquidity solutions.

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The latest in VC: Ripple effects of record capital availability

Kevin Swan

VP, Corporate Development

Buddy Arnheim

Co-chair, Emerging Companies

& Venture Capital Practice

Jim Marshall

Head of Emerging Manager Practice

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2Q 2018Venture Monitor Report

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