4 Q 2017
2017 sees more than $84B in
VC invested, the highest tally
since the dot-com era
Pages 4-5
The definitive review of the US venture capital ecosystem covering 4Q and full-year 2017
Sector analysis, with
spotlights by Silicon Valley
Bank on biotech & fintech
Pages 15-17
League tables for 4Q deals,
investors, exits and more
Pages 32-34
In partnership with
Credits & Contact
PitchBook Data, Inc.
JOHN GABBERT Founder, CEO
ADLEY BOWDEN Vice President,
Research & Analysis
Content
NIZAR TARHUNI Analysis Manager
KYLE STANFORD Analyst
BRYAN HANSON Data Analyst II
JENNIFER SAM Senior Graphic Designer
RESEARCH
reports@pitchbook.com
National Venture Capital Association
(NVCA)
BOBBY FRANKLIN President & CEO
MARYAM HAQUE Vice President of Research &
Strategic Engagement
BEN VEGHTE Vice President of Communications &
Marketing
Contact NVCA
nvca.org
nvca@nvca.org
Silicon Valley Bank
GREG BECKER Chief Executive Officer
MICHAEL DESCHENEAUX President
DENNY BOYLE Managing Director, Fintech
JONATHAN NORRIS Managing Director, Life
Science & Healthcare
DEREK RIDGLEY Credit Research & Development
Officer

Contact Silicon Valley Bank
svb.com
venturemonitor@svb.com
Perkins Coie
BUDDY ARNHEIM Partner, Emerging Companies &
Venture Capital
FIONA BROPHY Partner, Emerging Companies &
Venture Capital
LOWELL NESS Partner, Blockchain Technology &
Digital Currency

Contact Perkins Coie
perkinscoie.com
startuppercolator.com

Solium
KEVIN SWAN VP Corporate Development
JEREMY WRIGHT Head of Private Markets
STEVE LIU Head of Solium Analytics

Contact Solium
solium.com
Executive summary
3
Overview
4-5
Perkins Coie: Cryptos, standardization & structured
release valves
7-8
Angel/seed
9
First financings
10
Early-stage VC
11
Late-stage VC
12
Activity by region
13
Activity by sector
14
SVB: When tech meets biotech
15
SVB: US fintech investment grows in 2017: What’s
next?
17
Corporate VC
18-19
Growth equity
21-22
Q&A: SVB President Michael Descheneaux
23
SVB: Credit Insights: Debt vs. equity
24
SVB: Startup Financial Insights
25
Exits
26-27
Fundraising
28-30
League Tables
32-34
Methodology
35
Contents
2
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Executive Summary
3
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
The fourth quarter of 2017 bookended the year as the third consecutive quarter with more than $20 billion deployed into US venture-
backed companies, and marked the close of a strong year of investment that surpassed $80 billion annually for the first time since the
dot-com era. Investors deployed $23.75 billion into 1,772 companies in 4Q, the fewest since 4Q 2011, bringing the annual total to 7,783
and marking the lowest level since 2012.
In unpacking the data and speaking with venture investors, the impact of the continued evolution of market dynamics were evident in
2017. After investors raised a total of $110 billion via venture funds from 2014 to 2016—and an additional $32.4 billion last year—capital
ready for deployment into startups has been more than ample. Beyond traditional capital from venture capital funds, SoftBank’s headline-
grabbing $100 billion Vision Fund has had an ever-increasing role in the ecosystem with no signs of abating. SoftBank was present in
several of the highest-profile deals of the year, including WeWork’s $3 billion US investment and Compass’ $450 million rounds last
quarter. Not to mention it is set to become the largest investor in Uber this year.
While such a large pool of capital is available to the industry, investors are working to stay disciplined in their approach, translating into
overall fewer deals taking place, though more capital being deployed at higher valuations. As a result, median deal sizes have increased
across all stages in recent years, doubling at the angel, seed and early stages since 2013, while the median late-stage deal has grown
about 67% over that period. At the same time, the age of companies receiving funding at each series has also seen a noticeable increase
over the past five years. This is likely a cause and result of investors looking for stronger KPIs when investing such large checks. That is,
the stronger the company, the worthier of that oversized deal they seemingly are. Coinciding with these market shifts, investment into
unicorns (i.e., those valued at $1 billion+) occurred at a frenetic pace, reaching a record high in 2017. These companies attracted $19.1
billion last year, which represented 23% of the total capital invested across the industry.
An important trend that flew more under the radar in 2017 was the rise in life science investment, which reached a 10-year high with
$17.6 billion deployed to 1,046 companies working on groundbreaking innovations in healthcare. Part of the rise can be attributed to
the renewed focus on biotech opportunities. Once seen as a niche investment strategy, biotech has moved in the direction of software,
becoming somewhat mainstream in the venture world. In fact, cancer screening company Grail recorded the second-largest deal of
the fourth quarter, raising $1.2 billion, and bioengineering startup Ginkgo Bioworks raised $275 million in 4Q and joined Grail to reach
unicorn status. This trend is further supported by recent fundraising activity led by the arrival of new firms such as Pivotal bioVenture
Partners, which raised a $300 million fund in 2017, as well as established firms such as Andreessen Horowitz, which recently closed its
$450 million second biotech fund.
Public policy developments have also had a positive impact on the biotech sector. Investors have welcomed the recent appointment of
physician and former venture investor Scott Gottlieb as Commissioner of the Food and Drug Administration (FDA) and support his efforts
to reform the FDA to better advance healthcare innovations.
A change in leadership at the FDA hasn’t been the only example of public policy impacting the venture ecosystem. Many aspects of the
recently-passed tax reform plan will touch entrepreneurs, startups and venture investors. Lowering the corporate tax rate to 21% as well
as the repatriation provisions to allow corporations to bring back profits from overseas may signal increased M&A activity in the year
ahead after activity stalled in 2017 with the fewest recorded (565) since 2009. The changes in tax reform bring good news for startups
looking to take the next step in their growth, and VC investors seeking liquidity.
While the overall US economy posted a strong 2017, optimism for a strengthening venture-backed IPO environment in 2017 yielded an
uptick from 41 IPOs in 2016 to 58 in 2017, but the resurgent comeback many were looking for never fully materialized. With companies
staying private longer and valuations peaking in the private market, the challenge remains for public market investors to gain early access
to the new wave of high-growth companies in order to reap the full benefits. Capital market reform remains a focus for the venture
industry, and some are perhaps more cautiously optimistic for an uptick in IPO activity in 2018. Many will be closely tracking Spotify’s
efforts to directly list on the NYSE in hopes it could lead others to pursue the same track.
4
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$36.9$26.6$31.6$44.0$41.2$45.3$69.5$79.3$72.4$84.24,684 4,434
5,351
6,703
7,849
9,183
10,406 10,463
8,635
8,076
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
0
500
1,000
1,500
2,000
2,500
3,000
$0
$5
$10
$15
$20
$25
2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
Angel/Seed
Early VC
Late VC
Overview
Midway through last year, we highlighted
that 2017 was pacing to come in as the
highest year since at least the dot-com
era in terms of total capital invested. As
we closed out 2017, this certainly played
out, with more than $84 billion in capital
invested across nearly 8,100 completed
financings, reflecting a drop of around 6%
in terms of aggregate deals, yet a surge in
total deal value of 16% year over year (YoY).
The venture markets today have undergone
a shift in the dynamics and parameters
that have shaped them. Companies are
larger and many are taking on institutional
financings later in their lifecycle as
evident by the growing median age of
companies raising venture rounds. This
trend is particularly notable the earlier
in the investment cycle you look. Since
2013, the median age of companies raising
institutional angel & seed rounds has
grown a staggering 38% to 2.42 years, with
companies at the Series A round coming in
at just over 3.5 years of age, and Series B
companies typically raising those rounds at
around year five, on a median basis.
We’ve also continued to witness liquidity
cycles stretch to unprecedented levels,
driven by record amounts of dry powder
ready to be deployed to the outperforming
businesses that have proven their going
concerns in today’s marketplace. This
notion is compounded by a founder and
management mentality that has embraced
the continued use of private capital to fuel
growth, rather than move through an IPO
or M&A exit. Just as recently as a few years
ago, this wasn’t simply a matter of choice,
but also an implicit need to garner the
typically large amount of capital needed to
drive growth at a later-stage company. That
is not the case today.
To illustrate, venture financings of at least
$50 million have grown at a compounded
annual growth rate of some 13% since
$84B+ invested for first time since dot-com era
US VC activity
2017 a record year in deal value
US VC activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
5
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
Near 50% of value from deals of $50M+
US VC activity ($) by size
$6.3$2.4$2.7$13.9$16.3$17.4$19.27
7
9
27
25
24
69
75
49
73
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
Nearly record unicorn activity
US unicorn activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
2007, more than double the pace at which
rounds completed between $25 million and
$50 million (6% CAGR) have grown, and at
nearly 4x the rate at which rounds between
$5 million and $25 million have increased
(2.5%-3% CAGR). Further, VC financings of
$50 million+ accounted for nearly half of all
VC invested in 2017, a staggering figure in
and of itself that is even more remarkable
when compared to the fact that such
rounds represented less than 20% of all VC
invested in 2007.
Round sizes have also continued to increase
and have shown no sign of slowing down,
growing at a rapid pace across the entire
venture lifecycle. At $6 million, early-stage
rounds came in roughly 20% higher than
what we saw in 2016, with late-stage
rounds growing 14% to $11.4 million. This,
coupled with the rounds completed by
aging companies that continue to push
off full liquidity events, has resulted
in a profound rise in private company
valuations, particularly at the late stage
where we saw median Series D+ valuations
jump to $250 million last year, a hike of
over 85% relative to the already large $135
million figure we saw in 2016.
In many ways, 2017 can be characterized
by the record amount of activity we saw
involving unicorns. More than $19 billion
was invested into such companies across
73 completed fundings, reflecting a YoY
increase of over 10% and nearly 49%,
respectively. Further, investments in
companies valued over $1 billion amounted
to more than a fifth of all VC invested last
year, yet less than 1% of total deal flow.
We’ve also begun to see winners and losers
emerge amongst some of the various
tech platforms we saw rise over the last
half decade or so in areas such as fintech,
Big Data, virtual reality and the sharing
economy, among others. For example,
companies such as Airbnb, Lyft, WeWork,
Magic Leap, Unity, SoFi, Wish and
Coinbase have all built relatively successful
businesses over the last few years, able
to continue raising private capital at
hefty valuations and contributing to the
continued rise of unicorn financings.
Early-stage rounds grow in size by roughly 20%
Median deals size ($M) by stage
$0.9
$1.0
$5.0
$6.0
$10.0
$11.4
$0
$2
$4
$6
$8
$10
$12
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Angel/Seed
Early VC
Late VC
PitchBook-NVCA Venture Monitor
Shape the future of
the venture industry
with NVCA
ADVOCACY
COMMUNITY & EDUCATION
RESEARCH
JOIN US!
Please contact NVCA with your
membership queries
membership@nvca.org
202.864.5918
With more than 1,000 lawyers in 19 offices across the United States and Asia, Perkins Coie represents great companies across a wide range of
industries and stages of growth—from startups to FORTUNE 50 corporations. Attorneys in our Emerging Companies and Venture Capital practice
offer one of the premier legal resources in the nation for venture-backed companies that have IP as a key value driver. Our clients turn to us for
guidance on company formation, IP protection and enforcement, financings, corporate governance, technology transactions, product counsel,
and mergers and acquisitions, to name a few of the legal areas on which we focus. We also represent investors as they make, manage and divest
investments in diverse industries. Learn more at perkinscoie.com and startuppercolator.com.
7
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Cryptos, standardization & structured
release valves
Silicon Valley
continues to
impress us with
its ability to reinvent itself despite a
host of changing market dynamics. On
a sector basis, we’ve seen a transition
away from hardware businesses and a
slowdown across the 3D printing and
digital health technology markets. Yet just
as these platforms, among others, have
moved through their respective growth
cycles, many others have blossomed
today. This year’s flavor revolves around
the cryptocurrency markets, with AI and
robotics businesses also receiving ample
attention.
With the backdrop of more than $4.2 billion
raised via ICOs in 2017, we’ve continued
to see requests from prospective clients
to conduct new ICOs, or from businesses
looking to create new infrastructure
tools such as various digital or hardware
wallets. With this increased popularity,
however, comes increased complexity from
a legal perspective. Despite our active
participation in the market, we’ve remained
conservative with our approach to serving
the industry, following an evaluation
framework that spans three primary steps.
1: Token Utility
First, we look for tangible underlying
utility in the tokens of the businesses we
represent.
2: Management review
Second, we conduct extensive background
checks on the management teams we work
with. While we understand the prospective
value that can be derived in the market,
we also see the structure of the market at
times incentivizing bad actors. Thus, we
find it even more prudent that we vet the
teams we work with.
3: Setting expectations
Last, we look to set realistic expectations
with entrepreneurs. While on the surface,
an ICO may appear a much easier and
quicker capital-raising process, the reality
is in many situations it isn’t. Properly
conducted ICOs can take anywhere from
three to five months to move through
regulatory, tax and disclosure work, with
legal fees that can still reach the same
levels seen with small IPOs. To that point,
we look to ensure that the businesses we
work with not only provide tangible value,
but also are well prepared for the process
ahead of them.
Despite many traditional venture funds
moving down market as round sizes have
grown, many of the new companies across
the aforementioned sectors are availing
themselves of seed and early-stage funding
via the swathes of angel and sub-$100
million-$150 million vehicles that have
grown in popularity over recent years. This
produces a challenge in terms of fund
formation that we’ve worked to help
both new managers and smaller vehicles
sidestep.
Typically, such vehicles are only working
with a handful of LPs and as a result, we’ve
looked to adjust the way we structure such
funds and genericize the terms of these
vehicles to make the process much more
cost-effective. For funds raising anywhere
from $25 million to $50 million in capital,
racking up legal fees in the hundreds
of thousands of dollars can be seen as
impractical and oppressive to not only the
GPs but the LPs and thus, adding a more
structured approach in this market has
been pivotal.
In addition, as round sizes have grown
significantly as of late, many of these
smaller vehicles lack the capital under
management to participate in some of
TAKE OUR AR/VR SURVEY. ENTER TO WIN A $500 AMEX GIFT CARD.
PERKINS COIE LLP wants to hear from industry leaders in augmented and virtual reality. Please complete
our 2018 AR/VR Survey, which expands on our previous report on industry trends and the investment outlook.
You’ll be eligible to win a $500 American Express gift card with a completed survey. Individual responses will
remain confidential. Start survey>>
PerkinsCoie.com/AR/VR
Perkins Coie LLP Attorney Advertising
Calling All AR/VR Industry Leaders
the follow-on rounds of their portfolio
companies. However, in an effort to take
advantage of their preemptive rights to
participate in future financings, we’ve seen
an increasing trend of GPs structuring
one-time investment funds in the form
of special purpose vehicles. These SPVs
are structured as separate capital pools
set up between the venture partners and
their LPs to take advantage of follow-on
investment opportunities. As many of these
opportunities revolve around companies
that both the GPs and LPs typically already
know well, the hard work of sourcing,
placing and monitoring investments has
already been done, effectively offering
fund managers a boost in leverage that can
be very lucrative.
Lastly, the lack of liquidity driven by a
dearth of VC-backed exits has been a
heightened issue as of late. As companies
demonstrate go-to-market, customer
adoption and market expansion success,
raising capital privately has persisted. Yet
through this, companies face significant
challenges in providing liquidity to their
employees as the bulk of the incentives
placed in front of them come in the
form of equity. As a result, the use of
secondary sales for investors, management
and employees has grown. At times,
such transactions can be sporadic and
opportunistic, but given their expensive
nature and complexity, we’ve seen a
number of companies look to structure
formal, periodic secondary opportunities.
These sales don’t completely solve the
industry’s liquidity issues, as they are
constrained by limits on the amount of
vested equity that can be sold, and tend
to have difficulty in realizing an optimal
price for both employees and investors,
given discrepancies between common and
preferred stock owned by different groups.
Yet at the moment, they do provide a stop-
gap measure to help alleviate some of the
liquidity challenges aging private companies
are facing.
Cryptos, standardization & structured
release valves, cont.
Following a 2016 that saw both capital
invested and completed financings at
the angel & seed stage drop around 20%,
the market stabilized to some extent last
year. In lock-step with financing trends
across the entire venture market, deal
flow in the bucket declined some 13% YoY,
with aggregate capital invested growing
moderately. As many businesses continue
to bootstrap operations or rely on pre-
seed funding sources, today’s angel &
seed investments have become more
institutionalized. As a result, deal sizes have
grown, with the median size rising to $1
million last year, up 100% over the last five
years. In addition, we’ve seen a significant
amount of capital raised by micro VC funds
targeting the space. Between 2011 and
2015, the count of micro VC funds doubled,
and today sit on roughly $5 billion in dry
powder yet to be deployed.
What we continue to note, however, is
the lower counts in completed financings.
Today, more institutional investors are in
the market looking to back early-stage
startups. The number of companies
competing for this capital has also grown
considerably over the last few years. As
a result, the bar has risen in terms of the
KPIs that investors will want to see before
investing. This notion, along with the
delayed entrance of companies into the
traditional seed & angel space will continue
to contain deal flow in the size bucket.
9
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$429$405$391$1,269$655$631$526$733$823$1,113$1,241$866$1,274$1,084$1,326$1,577$1,278$1,371$2,026$1,854$2,053$2,171$2,078$1,946$1,653$1,749$1,701$1,518$1,579$1,672$1,830$1,7010
200
400
600
800
1,000
1,200
1,400
1,600
$0
$500
$1,000
$1,500
$2,000
$2,500
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($M)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$5M+
$1M-
$5M
$500K-
$1M
Under
$500K
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017Seed
Angel
Smaller deals shrinking in number
US angel & seed deals (#) by size
Angel deals account for larger amount
US angel vs seed deals (#)
Decline in angel & seed activity has slowed over the past year
US angel & seed activity
Angel & seed
activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
10
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$1.4$1.0$1.1$1.2$1.9$1.4$1.5$1.5$1.6$2.1$2.0$1.6$1.8$1.6$1.5$2.0$1.8$1.7$2.2$2.0$2.0$2.4$2.1$2.3$1.8$1.7$2.1$1.7$1.7$2.2$1.7$2.30
200
400
600
800
1,000
1,200
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
$3.0
1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
First financings
30.6%
29.3%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
First financings continue decline
Percentage of first-financing VC rounds
The number of startups receiving their first round has leveled off
US first-financing activity
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Angel/Seed
Early VC
Late VC
Angel/seed deals have fallen furthest
US first-financing VC rounds (#) by stage
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Since 1999, Solium has been simplifying the complexities of equity plans through smarter software, remarkable service and trusting relationships.
Our Shareworks platform is loved by emerging private companies as well as public enterprises. And more than 10,000 early-stage companies rely
on our products and valuation services.

Why Solium? Trust a company that manages the equity plans and cap tables of companies that are launching rockets into space, building self-
driving cars, disrupting the food delivery business and changing the way we get around.

Solium has offices in North America, UK & EMEA and Asia Pacific. Visit us at solium.com.
The early stage saw a dramatic increase
in capital investment during the fourth
quarter, seeing more than $10 billion
invested in a single quarter for the first
time. Not only is that a 40% increase over
the total invested during 3Q, but it is nearly
double the amount invested during the
same period in 2014, which at the time
was the highest we’ve seen of any quarter
in the last decade. The 582 transactions
completed during 4Q comes in as the
second lowest quarterly total of the past
five years, however, as we continue to
collect data we may see that number inch
slightly higher.
While increasing deal sizes have become
a common fixture, such deals at the early
stage illustrate how excessive dry powder
in the industry is not solely reserved for
late-stage plays, but even mid-sized and
early ones. The market will continue to
cycle through various trends, and while
investors might be looking to be more
selective before investing in what they see
as the next quality blockchain, robotics
or AI business, they’ll continue to make
larger initial, and follow on bets across the
industry.
11
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Early-stage VC
$3.0$2.5$2.7$2.5$3.3$2.9$3.5$3.8$3.0$3.6$3.1$3.0$3.2$3.7$3.2$4.4$4.6$5.1$4.8$5.5$4.9$7.0$6.1$5.9$5.9$6.4$5.7$5.0$5.8$7.3$7.3$10.20
100
200
300
400
500
600
700
800
900
$0
$2
$4
$6
$8
$10
$12
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$25M+
$10M-
$25M
$5M-
$10M
$1M-
$5M
$500K-
$1M
Under
$500K
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$25M+
$10M-
$25M
$5M-
$10M
$1M-
$5M
$500K-
$1M
Under
$500K
Large deals bolstering early-stage tallies
US early-stage activity (#) by size
Deals <$10M fall to decade low
US early-stage activity ($) by size
Early-stage VC has shown relatively consistent growth in deal value
US early-stage VC activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
$4.2$5.8$4.0$4.5$9.5$6.6$6.9$5.0$5.9$6.6$6.2$5.7$6.1$5.9$7.0$6.6$9.0$13.1$9.0$11.9$12.9$11.1$13.3$9.8$11.3$15.4$8.2$7.8$9.6$13.3$12.1$11.80
100
200
300
400
500
600
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
We continue to see late-stage venture
activity exhibit considerable influence over
the private financial markets, as well as
across the broader capital markets. Despite
a significant portion of non-traditional
investors exiting the market as of late,
newcomers such as sovereign wealth funds,
and, most dramatically, SoftBank’s $100
billion Vision Fund have only added fuel
to a maturing late-stage space recently
defined by mega-deals. Over $47 billion
was poured into late-stage VC rounds in
2017 across more than 1,600 transactions,
reflecting a roughly 10% YoY jump in deal
value through nearly equal number of
deals. Further, deals over $50 million in size
contributed nearly 70% of all late-stage
capital invested last year—that figure stood
at just over 30% in 2012.
Venture-backed exits have remained
subdued, particularly across some of the
primary avenues historically used. Dry
powder levels have never been higher,
leading to massive financings being readily
available. Despite the obvious impact
on exits and LP liquidity in this market
dynamic, many of the non-traditional
investors such as SoftBank have been
able to acquire a notable portion of their
late-stage transactions via the secondary
market. Should this continue, we could very
well see the late-stage market remain little
changed over the next year or so as earlier-
stage investors would begin to receive
an increased portion of the liquidity the
current market dynamic has taken away.
12
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Late-stage VC
Deal size growth clearly visible
US late-stage activity (#) by size
Late-stage deal value has stayed at historic highs
US late-stage activity
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
$50M+ deals account for 65% of capital
US late-stage activity ($) by stage
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
13
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
West Coast
40.3% of 4Q Deals
55.4% of 4Q Deal Value
Mountain
7.8% of 4Q Deals
3.4% of 4Q Deal Value
Midwest
1.6% of 4Q Deals
0.4% of 3Q Deal Value
Great Lakes
7.4%of 4Q Deals
3.1% of 4Q Deal Value
Mid-Atlantic
20.4% of 4Q Deals
19.2% of 4Q Deal Value
New England
8.7% of 4Q Deals
12.1% of 4Q Deal Value
Southeast
6.7% of 4Q Deals
4.5% of 4Q Deal Value
South
7.1% of 4Q Deals
2.0% of 4Q Deal Value
Mid-Atlantic holds steady in 2nd
US VC deal activity (#) by region
Despite opportunities outside traditional VC hubs, few trends have changed
4Q 2017 US VC deal activity by region
Activity by region
PitchBook-NVCA Venture Monitor
West Coast deal value rebounds in 4Q
US VC activity ($) by region
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q2014
2015
2016
2017
Great Lakes
Mid-Atlantic
Midwest
Mountain
New
England
South
Southeast
West Coast
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q2014
2015
2016
2017
Great Lakes
Mid-Atlantic
Midwest
Mountain
New
England
South
Southeast
West Coast
14
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Activity by sector
0
2,000
4,000
6,000
8,000
10,000
12,000
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Traditional sector lines are blurring
US VC activity (#) by sector
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Pharma & biotech has a big year
US VC activity ($) by sector
38.8%
37.8%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Software Deal Count
Software as % of Total US VC (#)
Software slowly sliding
US VC activity (#) in software
47.2%
36.5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
$0
$5
$10
$15
$20
$25
$30
$35
$40
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Software Deal Value ($B)
Software as % of Total US VC ($)
After 2016 peak, software declines
US VC activity ($B) in software
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
If there is an overall theme
for the breakout year of life
sciences/healthcare investments, it is this:
Technology is driving the future.
In 2017, investment into venture-backed
companies hit the stratosphere, punctuated
by several very large, $100 million-plus bets
in biopharma and diagnostics/tools (Dx/
Tools) companies. All told, $17.9 billion was
invested in life science companies last year,
a 21% increase over the previous record
of 2015 and 48% over 2016. In contrast,
overall venture funding only grew 16% over
2016.
Traditional healthcare investors and
generalist investors, many of the latter new
to the life sciences industry, are quickly
staking out positions in the emerging
ecosystem that is combining technology
advancements in artificial intelligence
(AI) with genomic data to develop
groundbreaking diagnostic and treatment
options. These investors see healthcare as
the next great frontier, one with enormous
challenges but also full of potential
for big payoffs. Specifically, biopharma
investments are focused on therapeutic
developments, notably oncology and
orphan/rare indications. The diagnostics
and tools sector is seeing huge investments
in next-generation DNA sequencing (NGS)
technology and liquid biopsy companies
that enable earlier and more accurate
cancer detection.
New investors propel life science investing
to new heights
What happened in 2017? Traditional VC
investors, joined by corporate venture arms
and crossover investors, provided a very
large pool of capital for biopharma and Dx/
Tools companies. Some interesting trends
to watch: Generalist investors quickly are
becoming the most active players in Dx/
Tools. Traditional venture investors have
returned to devices, joined by PE firms
and family offices that often lead deals in
commercialization rounds.
Biopharma leads the way
In 2017, biopharma saw a wave of IPOs,
while M&A activity slowed. The open IPO
window, in combination with record high
pre-money IPO valuations, helped drive
activity. Many biopharma IPOs earlier
in the 2013-2017 cycle involved early-
stage companies (pre-clinical and Phase I).
However, in 2017 we saw a dramatic shift
from early-stage to Phase II and Phase III
companies going public.
Biopharma investors see tremendous
returns
That said, half of biopharma big exit M&A
deals focused on early-stage (pre-clinical
and Phase I) companies. Biopharma
companies continue to buy early-stage
companies in order to replenish their
pipelines. This drove down the time to
exit from the close of Series A financing
for biopharmas, with the median time to
exit at a record 3.5 years. These deals had
very healthy upfront multiples, providing
tremendous returns for investors.
Dx/Tools investors bet heavily, but exits
are scarce
Investments and exits have diverged for
Dx/Tools. Despite heavy investment in
the sector, exits proved elusive. The R&D
tools subsector has largely dominated
the few acquisitions that have occurred
in the past five years. Historically, the
majority of Dx/Tools exits has been based
on commercial revenue multiples rather
than the enterprise values typically seen
in biopharma M&A. Based on the current
uptick in venture investment and soaring
valuations, robust exit multiples will be
difficult to achieve with the current acquirer
pool.
However, we believe that large Dx/Tools
companies will adopt M&A strategies
similar to biopharma: These companies
will fuel their primary R&D activities by
acquiring early-stage, venture-backed
Dx/Tools companies. At the same time,
tech giants like Amazon, Apple, Alphabet
and Microsoft are targeting Dx/Tools
companies as an entry point into life
science investing; we expect their activity
to grow and lead to big exits.
Large companies drive device M&A
IPOs and M&A activity remained stable for
device companies in 2017. M&A deals were
driven by large companies (J&J, Boston
Scientific, for example), although longtime
acquirer Medtronic continued to be absent.
The acquisitions focused on companies that
are developing minimally invasive solutions
and advanced imaging/visualization
platforms. Interestingly, companies that
require clinical trials (PMA/De Novo 510(k))
are being acquired early, while iterative
510(k) companies must prove themselves in
the market first. Since 2015, PMA and De
Novo 510(k) acquisitions generated larger
upfront multiples and swifter exits than
iterative 510(k) exits, and these acquisitions
are now approaching the upfront deal
values and multiples that we see in
biopharma. We anticipate healthcare-
focused investors to place bigger bets in
innovative early-stage device companies.
$8.5$9.2$11.9$14.6$11.9$17.61,076
1,140
1,201
1,228
1,051
1,093
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
15
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
When tech meets
biotech

US VC activity in life sciences
PitchBook-NVCA Venture Monitor
Emily Leproust, Co-founder and CEO, Twist Bioscience
©2017 SVB Financial Group. All rights reserved. Silicon Valley Bank is a member of the FDIC and the Federal Reserve System. SVB, SVB FINANCIAL GROUP,
SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are trademarks of SVB Financial Group, used under license.
Smart money.
Brilliant minds.
Connected.
We’re relentlessly focused on connecting investors
with the world’s most innovative thinkers. That’s
why we built the platform that enables the venture
and entrepreneurial ecosystem to move big ideas
forward—and create what they believe in.
svb.com
Download our Healthcare Investments and
Exits Report at svb.com/healthcareexits.
Fintech established itself as a
key standout category in 2017,
posting the strongest year for investment
since the 2015 peak. Aggregate fintech
investments reached approximately
$6.5 billion in 2017. Major contributing
categories have been alternative lending,
payments, wealth management, and
more recently blockchain/cryptocurrency,
insurtech and real estate tech.
The numbers are only part of what’s
interesting about the fintech story, with
unique challenges relative to disruptors of
other major industries. Specifically, scaling
has been difficult for fintech companies
dealing with compliance and regulatory
issues, access to capital hurdles and intense
competition from startups and incumbents.
Despite these challenges, we believe the
investment pace will continue due to two
core reasons: increasing customer demand
and enabling platform technologies that
provide key infrastructure for young fintech
companies to launch and grow. These
fintech infrastructure companies, analogous
to how Amazon Web Services and open
source supported software companies,
are lowering the barriers to new company
creation and helping them scale.
Successful fintech companies are finding
that partnerships often are key, including
with fintech infrastructure companies—
developer-focused platform technologies
based on APIs to solve complex operational
challenges of providing financial services.
These companies use software to leverage
existing infrastructure such as payment
rails, all types of bank accounts, customer
information databases and certain
compliance functions. This allows other
fintech companies and incumbent banks to
focus on building the core aspects of their
businesses instead of spending on costly
infrastructure, which lowers barriers to
entry and promotes innovation.
• Consider processing payments of
all types: There’s a patchwork of
government regulations that is expensive,
complicated and risky. Enter Stripe,
a payment processing for Internet
businesses, and Marqeta, an API platform
for prepaid debit and credit cards.
• Data aggregation: Consumers and
businesses keep their money and
investments in myriad financial accounts
and are constantly trying to simplify their
financial lives. Enter Plaid and Quovo
(aggregating account data in an app-
based world).
• Customer retention and cross-selling:
Finding new revenue streams from
current and prospective customers is
critical. Enter DriveWealth (natively
embedded modern brokerage platform).
While global opportunities abound for
fintech, there could be some bumpy times
ahead. We will eventually head into a
less buoyant economic climate, with
interest rates rising and access to capital
(potentially) shrinking. Fintech business
models will be tested in new ways.
As with other tech industry sectors, we are
seeing a flight to quality: VCs are focusing
investment on the “best of breed” fintech
companies. In this environment, we believe
fintech infrastructure companies are poised
to continue to drive innovation in financial
services by providing the tools and services
that will become even more critical for
other fintech companies and incumbent
financial services firms to start and survive.
These are the fintech companies to watch.
17
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
US fintech
investment grows in
2017: What’s next?
$0.9$0.7$0.7$1.3$1.2$1.7$2.1$4.6$7.5$5.4$6.5107
118
129
151
227
311
409
562
572
451
475
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2017
Deal Value ($B)
# of Deals Closed

US VC activity in fintech
5.2%
5.9%
7.5%
7.7%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Fintech % of Total Deals
Fintech % of Total Deal Value

Fintech investment as percentage of total US VC activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Corporate venture investors have
continued to play a growing role within
the US VC industry, participating in rounds
that amounted to 44% of all 2017 venture
deal value. In total, CVCs participated
in 1,268 completed financings worth a
record amount of over $37 billion last year,
reflecting YoY increases of 3% and 15%,
respectively. While CVCs have certainly
been active across the venture lifecycle,
these investors have not been shy to cut
large checks as the industry has continued
to necessitate in order to participate in
follow-on fundings. To illustrate, CVCs
participated in roughly 29% of all venture
financings completed above $25 million last
year, the highest proportion we’ve seen
since at least 2006. Further, over $11 billion
worth of transactions completed last year
also included at least one corporate venture
investor.
18
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Corporate VC
0
50
100
150
200
250
300
350
400
$0
$2
$4
$6
$8
$10
$12
$14
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
Angel/Seed
Early VC
Later VC
$10.0$6.5$7.9$12.6$11.7$14.3$26.9$34.7$32.5$37.4674
477
557
713
829
1,045
1,283
1,379
1,231
1,268
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
CVCs have continued participating in high volume of large deals
US corporate VC participation activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Corporate VC activity ticks up in 2017
US corporate VC participation activity
14.3%
15.7%
44.8%
44.4%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
CVC % of VC Deal Count
CVC % of VC Deal Value
CVCs taking part in higher % of deals
US corporate VC participation % of total VC
PitchBook-NVCA Venture Monitor
As we continue to see emerging
technologies develop in rapid cycles, access
to intellectual property will continue
to drive corporate VC investment. For
example, nearly all of the major auto
companies and tech giants are invested in
AI-driven smart car technologies, helping
boost their legacy R&D processes. Lyft’s
$1.5 billion deal in December included
investment from Google Capital, and the
company previously took capital from
General Motors (NYSE: GM) as well. Big
pharma & biotech corporations have also
looked to startups that are developing
breakthrough technologies and drugs,
especially considering the cost of drug
development has soared in recent years.
For instance, Grail’s $1.2 billion funding last
quarter saw Merck (NYSE: MRK), Bristol-
Myers Squibb (NYSE: BMY) and Johnson &
Johnson (NYSE: JNJ) all join in.
19
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
CVC 50M+ deals reach highest in decade
US corporate VC activity (#) by size
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
CVC deal sizes continues to grow
US corporate VC activity ($) by size
0
200
400
600
800
1,000
1,200
1,400
1,600
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
CVC following overall VC sector trends
US corporate VC participation (#) by sector
$0
$5
$10
$15
$20
$25
$30
$35
$40
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Software holding onto top spot
US corporate VC participation ($) by sector
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Success is doing what you
want.
And letting someone
else worry about the rest.
Solve your cap table
Comply with 409A
Love your numbers
Stop by and ask us how.
solium.com
© Solium Capital LLC. All rights reserved.
21
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Growth equity
$3.5$7.5$3.3$2.7$8.0$5.6$4.5$4.7$3.6$4.8$7.7$3.7$6.1$4.6$4.8$4.2$8.6$11.1$7.7$9.0$11.1$9.1$11.5$9.5$10.5$13.8$6.0$8.5$7.3$12.9$7.5$9.4 0
50
100
150
200
250
300
$0
$2
$4
$6
$8
$10
$12
$14
$16
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
$18.7$10.4$17.0$22.8$19.8$19.7$36.5$41.2$38.7$37.2553
360
496
581 606 608
802 878
742
777
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
GE continues strong run
US growth equity activity
$35.0
$39.5
$134.1
$169.8
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Median Deal Size
Median Pre-money Valuation
Median GE sizes reaching new highs
Median growth equity deal size and valuation ($M)
Deal volume slowed through back half of 2017
US growth equity activity
As growth equity has grown, the
median size and valuations of
such deals has skyrocketed
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
22
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20072008200920102011201220132014201520162017$200M+
$100M-
$200M
$75M-
$100M
$50M-
$75M
$30M-
$50M
$15M-
$30M
21% of GE deals exceed $75M
US growth equity activity (#) by size
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$200M+
$100M-
$200M
$75M-
$100M
$50M-
$75M
$30M-
$50M
$15M-
$30M
Growth in overall value is clear
US growth equity activity ($) by size
0
100
200
300
400
500
600
700
800
900
1,000
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Sector investment stays steady
US growth equity activity (#) by sector
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
PE growth firms primarily look at tech
US growth equity activity ($) by sector
Having surged post-2013, the
impact of the growth equity
stage has been unmistakable
From 2014 through 2017’s end,
the inflation of even the growth
financing stage is clear
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Note: Growth equity is not included as a subset of overall VC data, but is rather its own
unique dataset. See the Methodology, page 35, for more details on this particular category.
23
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
What’s your outlook for the venture capital
industry given its trends in recent years?
Interest in the tech sector is strong for
investors, companies and corporates alike,
and venture capital remains the go-to
source of funding for growing businesses.
VC firms are bullish on tech, and the
favorable fundraising environment is
resulting in new expansion and opportunity
funds. While raising VC funds for seed
investing is challenging, there is plenty of
capital for successful late-stage companies.
In each of the last four years, annual US
venture fundraising has exceeded $30
billion, and that figure doesn’t include
nontraditional investors such as SoftBank’s
Vision Fund. With excessive dry powder
in the ecosystem, companies are choosing
to stay private longer. However, as the
pressure to generate liquidity increases,
there could be more M&A activity.
What recent factors or market dynamics have
impacted how SVB evaluates, invests in, or
lends to the venture community?
The pace of M&A exits was healthy in 2017.
IPOs, however, were a different story. The
growth in IPOs we had expected did not
materialize. Normally, this would put a
chilling effect on valuations and the pace
of venture investing in general. Instead,
capital continued to be available for
private, late-stage companies throughout
2017, resulting in valuations at the high
end of the private company market that
occasionally outpaced those seen in the
public market.
These dynamics impacted the venture
debt market, too. With ample, relatively
inexpensive equity financing available to
breakout companies across multiple sectors,
coming from less-traditional sources such
as mutual funds, hedge funds, family
offices, micro VCs and initial coin offerings
(ICOs), many companies that would have
otherwise been candidates for venture debt
didn’t require this supplemental financing
in order to fund their plan and/or reduce
dilution. At the same time, other breakout
companies elected to supplement their
equity raise with unprecedented amounts
of venture debt, which compelled us to
reevaluate how we think about valuations,
growth rates, burn rates, access to capital
and the amount of debt that is healthy.
We’ve seen anecdotes around the use of
capital call loans by GPs across private equity
and VC. What benefits do GPs realize?
While there are differing views on this
subject, capital call lending provides GPs
with a tool to fund investments and/or
operating expenses in advance of receiving
capital calls from the fund’s limited
partners. VC and PE firms both use this tool,
but typically see different benefits. Focused
on operational benefits, VCs are attracted
by the convenience of being able to fund
an investment quickly while reducing the
number and frequency of capital calls, but
typically do not borrow for long periods of
time before calling capital. In contrast, PE
funds value those same benefits, but tend
to borrow for longer periods of time so as
to delay the eventual capital call, thereby
improving fund IRR.
Have you noticed any changes in regional
deal flow, specifically new trends in
investment outside of Silicon Valley? If so,
what is driving that?
SVB has seen a dramatic increase in new
capital sources and growing tech hubs in
places such as Southern California, New
York and London. New domestic capital
sources such as family offices and high-net-
worth individuals and new foreign capital
sources, mostly from Asia, are fueling
the venture growth in SoCal, New York,
Salt Lake City and Boston, to name some
examples. Much like the pattern seen with
successful Silicon Valley-based companies,
employees of successful startups in these
regions are leaving to start new ventures.
VCs are also showing greater interest to
invest in markets outside of Silicon Valley,
exemplified by funds such as Steve Case’s
“Rise of the Rest Fund.”
Given the massive rise in fundraising in recent
years, what do you think the future holds?
We expect VC fundraising to remain strong
considering the pace of innovation, growing
pervasiveness of technology, increasing
number of viable investment opportunities
and the expectation that more mega funds
will be created, such as SoftBank’s Vision
Fund. Venture-backed companies are
staying private longer, prompting larger
capital investments to continue to support
these companies.
The venture industry has taken off since the end of the Great Recession, achieving figures unseen
since the dot-com era. In the past few years, we’ve seen new dynamics take hold: Deal sizes grew
while the number of completed financings declined; valuations rose as IPOs plummeted; and a
variety of nontraditional investors became involved. We asked Silicon Valley Bank’s President Mike
Descheneaux about his perspectives on the venture industry today and where it’s headed:
Michael Descheneaux is the president of Silicon Valley Bank,
and oversees the global commercial bank, private bank, credit
administration and business analytics, as well as SVB Financial
Group’s venture capital investment arm, SVB Capital. He is also a
member of the executive committee of the company and serves on
the board of directors for the company’s joint venture bank in China.
Michael joined SVB Financial Group in 2006 and was appointed chief
financial officer in 2007. As CFO, Descheneaux was responsible for
all finance, treasury and accounting functions for the company.
As market dynamics shift, lenders
adapting strategies to fit
Q&A with Michael Descheneaux, President of Silicon Valley Bank
24
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Credit insights: Debt vs. equity
8.5%47.4%26.6%12.6%4.9%0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Series Seed
Series A
Series B
Series C
Series D+
The venture debt market consists
of a relatively small universe of
lenders that provide loans which explicitly
rely on the borrower’s continued access
to venture equity as the primary source
of repayment for the loan. This type
of loan, typically referred to as growth
capital, differs from loans that rely on other
sources of repayment, such as cash flow or
the collection of accounts receivable.
Venture debt lenders evaluate both
the durability of support from existing
investors and probability of attracting
interest from new, outside investors to
ensure the loan is repaid. For these reasons,
venture debt is deployed most broadly at
the Series A stage, when reserves among
the existing syndicate are typically at their
apex and valuations are heavily influenced
by anticipatory metrics, including technical
or product development milestones.
Looking back over the last eight quarters,
debt-to-valuation ranges have remained
fairly consistent – buoyed by either
increasingly larger equity round sizes at the
early stage or increasing valuations at the
late stage.
Typically Series A-B companies raise equity
that supports nine to 12 months of runway
and venture debt supplements by providing
an additional three to six months. While the
median debt-to-valuation ratio is typically
higher for Series A-B than for later stage
companies, the average equity round is also
smaller which in turn means the average
loan size is smaller.
In contrast, later-stage companies (Series
C-D) typically have lower median debt-
to-valuation ratios, but the average loan
size grows along with the equity size for
each successive round. The universe of
companies that receive successive rounds
of equity shrinks over time as valuations
are increasingly correlated to business
execution and less competitive companies
disappear. Thus, should loan size increase
with each successive round, too much debt
can impact future equity negotiations.
In prior business cycles, the equity
progression described above (larger equity
rounds / lower debt-to-valuation ratios)
often forced the most successful later-
stage companies to diversify their investor
syndicate beyond the VC ecosystem – in
order to satisfy the increasingly larger
funding cycles required to grow at scale.
It was also generally true that super-
sized equity rounds often could not be
accommodated in the private market,
which drove companies to the public
markets or an M&A deal. But now this
pattern has reversed.
Super-sized rounds are now routinely
being filled with private rather than public
equity. In addition to being abundant, later
stage PE has also been relatively cheap (for
breakout companies) in historical terms.
As a result, the super-sizing of the largest
late stage funding rounds has effectively
outstripped the capacity of the venture
debt market to ‘match fund’ in some
examples, and the highly competitive
pricing dynamic for those same examples
has increasingly placed later stage equity in
direct competition with venture debt.

Distribution of US venture debt by series

Debt-to-valuation (%) by quarter
6.1%
7.1%
7.6%
6.5%
6.9%
6.5%
6.2%
5.9%
0%
2%
4%
6%
8%
10%
12%
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
2015
2016
2017
Third Quartile
First Quartile
Median
6.7%
8.0%
5.7%
4.2%
3.3%
0%
2%
4%
6%
8%
10%
12%
Seed
Series A
Series B
Series C
Series D
Third Quartile
First Quartile
Median

Debt-to-valuation (%) by stage
Source: Silicon Valley Bank analysis
Source: Silicon Valley Bank analysis
Source: Silicon Valley Bank analysis
Note: Fluctuations in financial and credit ratios can be influenced by changes in the
underlying subsector composition on the measurement date.
25
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Startup financial
insights
As the venture ecosystem
continues to benefit from
record fundraising, access to capital and
valuation growth, technology companies
are demonstrating traction and validating
their business models at increasingly earlier
stages in their fundraising lifecycle. One of
the key indicators of life stage and business
model traction is a company’s revenue run
rate, or annualized revenue.
While early-stage VC-backed tech deals
are rarely valued on the basis of revenue
alone, many successful companies have
demonstrated a multimillion-dollar revenue
run rate at the time of their Series A and
Series B fundraising. Based on SVB analysis,
US tech companies raising Series A rounds
2011-2017 showed a median revenue run
rate of $1.5 million, while companies raising
their Series B round showed more than
double that, at $3.5 million.
At the growth stage, companies continue
to scale operations and build a more
predictable conversion funnel, resulting in
greater revenue traction at their Series C
and Series D rounds. Companies raising a
Series C round showed a median revenue
run rate of $7.5 million, while companies
raising their Series D round showed nearly
double that, at $13.7 million.
While revenue growth is a useful gauge
of business model traction, especially at
earlier stages, today’s venture-backed tech
companies are demonstrating operating
discipline, thanks in part to declining
operating costs over time, and charting a
path to profitability as they mature through
the fundraising life cycle. SVB has observed
that US technology companies raising their
Series A and Series B rounds post median
operating expenses that are more than
double their revenues: -145% for Series A
and -120% for Series B.
As companies move to growth stage
at Series C and Series D, realizing more
significant traction and revenue growth,
operating margins tend to improve
significantly. Tech companies raising
their Series C round showed a median
operating margin of approximately -75%,
an improvement of 45% from the Series
B round, and a median operating margin
of -53% at their Series D round. At this
stage, successful companies continue to
show operating margin improvement and
revenue growth as they move to the exit
stage of the J-curve and, eventually, realize
their valuation through an exit event.
$1.5
$3.5
$7.5
$13.7
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
$20
Series A
Series B
Series C
Series D
Third Quartile
First Quartile
Median

Startup revenue run rate ($M) on deal date by series
-145%-120%-77%-53%-160%
-140%
-120%
-100%
-80%
-60%
-40%
-20%
0%
Series A
Series B
Series C
Series D

Median operating margin (%) on deal date by Series
Source: Silicon Valley Bank
*Data from 2011-2017
Source: Silicon Valley Bank
*Data from 2011-2017
For more than 30 years, Silicon Valley Bank (SVB) has helped innovative companies and their investors move bold ideas forward, fast. SVB
provides targeted financial services and expertise through its offices in innovation centers around the world. With commercial, international and
private banking services, SVB helps address the unique needs of innovators. Learn more at svb.com.

©2017 SVB Financial Group. All rights reserved. SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the
chevron device are trademarks of SVB Financial Group, used under license. Silicon Valley Bank is a member of the FDIC and the Federal Reserve
System. Silicon Valley Bank is the California bank subsidiary of SVB Financial Group (Nasdaq: SIVB).
26
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Exits
$9.1$4.8$7.9$9.8$8.8$9.2$7.7$8.6$6.8$26.3$12.1$10.5$4.0$8.7$11.4$13.1$14.0$11.4$18.2$36.8$8.7$10.5$15.2$15.2$11.1$16.6$15.9$9.3$17.0$12.0$12.2$9.80
50
100
150
200
250
300
$0
$5
$10
$15
$20
$25
$30
$35
$40
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Capital Invested ($B)
# of Deals Closed
$16.5$15.7$31.6$34.2$55.7$37.2$80.3$49.6$52.9$51.0484
479
698
738
867 891
1,065
1,003
857
769
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Exit Value ($B)
# of Exits Closed
Exits continue to slide, leaving industry in crunch
US VC-backed exit activity
Exits slide during eight of past 11 quarters
US VC-backed exit activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
We’ve continued to see completed exit
counts trend lower following a surge in VC-
backed company sales and liquidity events
between 2009 and 2014. However, despite
counts moving lower, sales have been
significantly larger and aggregate exit value
has remained heightened. 2017 saw more
than $51 billion exited across some 769
liquidity events, equating to a marginal YoY
decline of 3.6% in terms of aggregate exit
value, yet a drop of over 10% in terms of
volume. Buoyed by SNAP’s massive capital
raise ($3.4B) and a host of backlogged exits
that came to market early in the year, Q1
showed signs of a rebounding exit market
with nearly $17 billion exited across 228
sales. However, each subsequent quarter
saw exit activity in terms of both value
and volume decline. In fact, the 167 exits
completed in 4Q registers as the lowest
figure we’ve seen since Q2 2011.
We’ve harped on today’s industry dynamic,
which can be summarized by a few items
such as larger round and exit sizes, fewer
sales and older companies raising capital.
This has certainly manifested itself on the
back end of the venture cycle with the
median exit size across all exit types soaring
to an unprecedented level. At $85 million
last year, the median exit size jumped close
to 17% YoY. This figure not only comes in as
the largest median exit size we’ve recorded
in at least a decade, but also the largest
YoY percentage increase in that metric.
This trend also holds true when looking at
strategic and financial acquisitions, which
paid a median of $87 million to acquire
venture-backed businesses last year— also
the highest figure we’ve seen on record
in at least a decade. With sales processes
continuing to push out, the median time
to exit in the venture market has reached
a record 5.6 years. Undoubtedly driven
by the ability of many companies to raise
larger sums of late-stage private capital,
companies are coming to market as larger
entities and as a result, exit sizes and
valuations have hit uncharted territory.
27
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
9.7x
9.3x
7.7x
9.1x
9.1x
10.3x
9.8x
10.4x
10.1x
10.5x
8,635
8,076
857
769
0
2,000
4,000
6,000
8,000
10,000
12,000
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Investments/Exits
# of Investments
# of Exits
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010
2011
2012
2013
2014
2015
2016
2017
Acquisi�on
IPO
Buyout
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20102011201220132014201520162017$500M+
$100M-
$500M
$50M-
$100M
$25M-
$50M
Under
$25M
Exits are getting larger, however
US VC-backed exit (#) by size
Buyouts account for 19% of exits
US VC-backed exit activity (#) by type
Despite slowing deal flow, exits fall further
US VC investment-to-exit ratio
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Despite exit volume declining, we’ve
noticed a shift in the makeup of exit
types being utilized by management
teams. Strategic acquisitions typically
represent the bulk of sales by sheer
count, yet as M&A activity across the
board has lightened up, VC-backed sales
to strategics last year declined roughly
20% YoY. That said, we’ve continued to
see private equity play a larger role in the
venture market. Nearly $7 billion worth
of venture-backed exits were completed
by private equity last year across 146
sales, reflecting YoY growth of over 200%
in terms of total exit value, and a jump
of 33% in terms of completed sales to
PE. With the proliferation of both tech-
focused private equity funds, as well as a
lending ecosystem that has grown to better
understand how to stack debt against
recurring revenue software businesses, we
expect this outlet to remain in place for
venture-backed management teams. Last,
the IPO markets rebounded as well last
year, with close to $10 billion raised across
58 completed listings, reflecting significant
increases of 236% and 41%, respectively.
28
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Fundraising
$8.5$3.5$3.8$3.9$6.8$6.4$3.3$8.7$8.8$4.5$7.9$2.5$6.3$4.5$4.8$5.5$10.0$9.8$6.8$8.7$7.7$11.7$3.8$11.6$10.4$12.8$10.1$6.9$8.2$11.8$5.7$6.70
10
20
30
40
50
60
70
80
90
$0
$2
$4
$6
$8
$10
$12
$14
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Capital Raised ($B)
# of Funds Closed
$30.1$12.0$19.8$25.3$23.7$21.2$35.3$34.8$40.2$32.4185
119
154
147
188
206
274
259
281
209
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Capital Raised ($B)
# of Funds Closed
$143B raised since 2014
US VC fundraising activity
Fundraising showed signs of slowing over past six months
US VC fundraising activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
While coming in lower than the total
amount of capital raised in 2016, on a
historical basis, managers were still able
to garner considerable success on the
fundraising trail last year. More than $32
billion was raised across 209 completed
closes, equating to a YoY drop of close to
20% in terms of total capital raised and 26%
in terms of the number of vehicles closed.
Interestingly, barring activity between 2014
and 2016, more vehicles closed last year
than in any year in the last decade, with
more capital raised than in any year during
that same timeframe.
Buoyed by a mix of outsized fundraises
by the likes of NEA ($3.3 billion) and
Mithril Capital Management ($850 million),
along with a steady pace of fund closings,
2017 was poised to match the record
amount of capital ($40 billion) raised in
2016. However, as we transitioned to the
back half of the year, fund sizes remained
29
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$2.4$1.1$0.9$1.9$1.6$1.5$2.0$1.7$2.2$3.330
25
32
18
27
21
39
25
25
35
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Capital Raised ($B)
# of Funds Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$1B+
$500M-
$1B
$250M-
$500M
$100M-
$250M
$50M-
$100M
Under
$50M
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$1B+
$500M-
$1B
$250M-
$500M
$100M-
$250M
$50M-
$100M
Under
$50M

US VC fundraising activity (#) by size

US VC fundraising activity ($) by size
First-time funds finding results
US first VC fundraising activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
heightened on a median basis, but total
closings dropped off dramatically, with both
3Q and 4Q seeing 36 and 45 total vehicles
closed, respectively. This compares to the
64 funds we saw close in each of the first
two quarters of last year. Given the massive
uptick in vehicles we’ve continued to see
come to market in recent years, along with
ample dry powder yet to be deployed,
seeing commitments slow to a certain
extent is likely a positive to the overall
industry, as capital availability certainly isn’t
an issue for the market today.
Despite the drop in fund counts in 2H,
some of the largest vehicles to close in
2017 came then, such as TPG’s Rise Fund,
which closed on $2 billion in 4Q, and
Institutional Venture Partners’ IVP XVI,
which closed on $1.5 billion in September
of last year. To that point, median fund sizes
have continued to rise, coming in at $60
million last year, relative to $50 million in
2016 and just $32 million in 2015.
As we’ve noticed across the PE market
as well, first-time fund managers have
continued to garner interest from LPs
across all stages. More than $3.3 billion was
raised by such managers last year across
35 vehicles, a growth of 47% and 40%,
respectively. Further, first-time managers
raising sub $50 million vehicles have also
had considerable success, raising close
to $380 million last year across 15 funds,
equating to a jump of some 23% in terms of
total capital raised across the same number
of vehicles that closed in the bucket in
2016.
30
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$50.0
$60.1
$149.3
$156.4
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
$200
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Median
Average
2.38 2.40
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
1.3x
1.5x
0.0x
0.2x
0.4x
0.6x
0.8x
1.0x
1.2x
1.4x
1.6x
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
19.0
13.1
19.4
15.9
0
5
10
15
20
25
30
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Median
Average
Median fund size jumps past $60M
Median & average VC fund size ($M)
Time to close fell last year
Median & average time (months) to close VC fund
Firms raising next funds faster
Average time (years) between funds
Follow-on funds growing significantly
Median step-up between funds
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Looking ahead to 2018, fund
sizes look set to only grow
2017 saw a remarkable 20%
YoY increase in the average step-
ups of venture funds
See how the PitchBook Platform can
help VCs invest smarter.
demo@pitchbook.com
We do
pre-money valuations,
cap tables,
series terms,
custom search,
growth metrics.
You invest
in the next big thing.
32
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
4Q league tables
Plug and Play Tech Center
11
Innovation Works
10
Social Starts
9
Right Side Capital
Management
8
New Enterprise Associates
7
SV Angel
7
Y Combinator
7
FundersClub
6
Techstars
6
500 Startups
5
Eniac Ventures
5
Liquid 2 Ventures
5
PLG Ventures
5
TEDCO
5
Andreessen Horowitz
4
Greycroft
4
M25 Group
4
Social Capital
4
Most active investors
angel/seed
Most active investors
early stage
Most active investors
late stage
New Enterprise Associates
15
Keiretsu Forum
14
Y Combinator
10
Kleiner Perkins Caufield &
Byers
9
Plug and Play Tech Center
9
True Ventures
8
Accel
7
GV
7
Intel Capital
7
Keiretsu Capital
7
Khosla Ventures
7
Lerer Hippeau Ventures
7
Sequoia Capital
7
ARCH Venture Partners
6
Comcast Ventures
6
Lux Capital
6
Redpoint Ventures
6
RRE Ventures
6
Salesforce Ventures
6
Slow Ventures
6
Alexandria Venture
Investments
5
AME Cloud Ventures
5
Great Oaks Venture Capital
5
Greycroft
5
Lightspeed Venture Partners
5
Next47
5
Shasta Ventures
5
SV Angel
5
Tiny Capital
5
Versant Venture Management
5
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Keiretsu Forum
11
Kleiner Perkins Caufield &
Byers
10
GV
9
New Enterprise Associates
7
Norwest Venture Partners
7
Think +
7
General Catalyst Partners
6
Salesforce Ventures
6
Baillie Gifford
5
Flagship Pioneering
5
Menlo Ventures
5
Spark Capital
5
True Ventures
5
Bain Capital Ventures
4
Canaan Partners
4
DBL Partners
4
Fidelity Management &
Research
4
GE Ventures
4
Keiretsu Capital
4
Lightspeed Venture Partners
4
Meritech Capital Partners
4
Revolution
4
SharesPost
4
PitchBook-NVCA Venture Monitor
33
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Company
Deal size ($M)
Series/stage
Date
HQ
State
Industry
Lyft
1,500.00
Series H
12/5/2017
San Francisco
California
Software
Grail
1,211.66
Series B
11/22/2017
Menlo Park
California
Pharma and Biotech
Faraday Future
1,000.00
Early Stage VC
12/22/2017
Los Angeles
California
Transportation
Magic Leap
502.00
Series D
10/17/2017
Plantation
Florida
Computer Hardware
Compass
500.00
Early Stage VC
12/7/2017
New York
New York
Consumer Products and
Services
SpaceX
450.00
Series H
11/27/2017
Hawthorne
California
Aerospace & defense
Essential Products
300.00
Series B
10/12/2017
Palo Alto
California
Consumer Durables
Ginkgo Bioworks
275.00
Series D
12/14/2017
Boston
Massachusetts
Pharma and Biotech
Harmony Biosciences
270.00
Early Stage VC
10/5/2017
Plymouth
Meeting
Pennsylvania
Pharma and Biotech
Via
250.00
Early Stage VC
10/2/2017
New York
New York
Software
Top 10 largest US VC deals in 4Q 2017
Top 10 largest US VC funds closed in 4Q 2017
Top five largest US VC-backed IPOs in 4Q 2017
Largest US VC acquisitions in 4Q 2017
Fund name
Investor
Fund size ($M)
Close date
HQ
State
TPG Growth
The Rise Fund
$2,000.00
10/4/2017
Washington
District of
Columbia
Flagship Pioneering
Flagship Pioneering Fund VI
$618.00
12/20/2017
Cambridge
Massachusetts
Andreessen Horowitz
AH Bio Fund II
$450.00
12/20/2017
Menlo Park
California
Frazier Healthcare Partners
Frazier Life Sciences IX
$419.00
11/1/2017
Seattle
Washington
Redpoint Ventures
Redpoint Omega III
$400.00
10/2/2017
Menlo Park
California
Icon Ventures
Icon Ventures VI
$263.00
10/11/2017
Palo Alto
California
Vida Ventures
Vida Ventures
$254.80
12/5/2017
Boston
Massachusetts
Illumina Ventures
Illumina Innovation Fund I
$230.00
10/16/2017
San Francisco
California
Owl Ventures
Owl Ventures II
$185.00
10/19/2017
San Francisco
California
M33 Growth
M33 Growth I
$180.00
10/13/2017
Boston
Massachusetts
Company
Exit size ($M)
Exit post-val ($M) Date
HQ
State
Industry
Razer
528.73
4,407.39
13-Nov-2017
San Francisco
California
Computer Hardware
Switch
531.25
4,200.25
5-Oct-2017
Las Vegas
Nevada
IT Services
CarGurus
150.40
1,684.90
12-Oct-2017
Cambridge
Massachusetts
Transportation
Denali Therapeutics
250.00
1,583.63
8-Dec-2017
South San
Francisco
California
Pharma and Biotech
Stitch Fix
120.00
1,527.00
17-Nov-2017
San Francisco
California
Retail
Company
Exit size ($M)
Acquirer(s)
Date
HQ
State
Industry
NeoTract
1,100.00
Teleflex
2-Oct-2017
Pleasanton
California
Healthcare Devices and
Supplies
Musical.ly
1,000.00
Cheetah Mobile,
Bytedance
19-Dec-2017
Santa Monica
California
Software
ZirMed
750.00
Bain Capital,
Navicure
1-Nov-2017
Louisville
Kentucky
Healthcare Technology
Systems
Black Duck
547.00
Synopsys
12-Dec-2017
Burlington
Massachusetts
Software
nuTonomy
450.00
Aptiv
21-Nov-2017
Cambridge
Massachusetts
Software
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
34
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
US VC activity by state &
territory
US VC activity by Metropolitan
Statistical Area (MSA)
State
District
Deal Count
California
District 12
141
New York
District 12
109
California
District 18
82
New York
District 10
57
California
District 14
52
California
District 52
42
Massachusetts
District 7
42
California
District 17
38
California
District 13
32
California
District 33
29
Washington
District 7
29
Massachusetts
District 5
27
Illinois
District 7
22
Colorado
District 2
20
Colorado
District 1
18
California
District 15
16
Pennsylvania
District 14
16
California
District 49
15
Texas
District 21
15
Texas
District 25
14
New York
District 7
13
District of
Columbia
Delegate
District
12
Massachusetts
District 4
11
Massachusetts
District 8
11
Virginia
District 8
11
Arizona
District 9
9
California
District 2
9
California
District 28
9
North Carolina
District 6
9
California
District 19
8
North Carolina
District 4
8
Ohio
District 3
8
Tennessee
District 5
8
Utah
District 3
8
Wisconsin
District 2
8
US VC activity by
Congressional District
State
Deal Count
California
615
New York
219
Massachusetts
132
Texas
83
Washington
72
Colorado
59
Florida
48
Illinois
46
Pennsylvania
43
North Carolina
41
Virginia
32
Utah
31
Ohio
29
Arizona
24
Maryland
24
New Jersey
22
Oregon
22
Georgia
21
Tennessee
19
Indiana
16
Wisconsin
16
Connecticut
14
District of Columbia
14
Minnesota
14
Michigan
11
Kentucky
10
Delaware
8
Idaho
8
Kansas
7
Iowa
6
Louisiana
6
Nevada
6
South Carolina
6
Arkansas
5
MSA
Deal Count
San Francisco-Oakland-Fremont,
CA
310
New York-Northern New Jersey-
Long Island, NY-NJ-PA
227
Boston-Cambridge-Quincy,
MA-NH
130
San Jose-Sunnyvale-Santa Clara,
CA
112
Los Angeles-Long Beach-Santa
Ana, CA
106
San Diego-Carlsbad-San Marcos,
CA
61
Seattle-Tacoma-Bellevue, WA
61
Austin-Round Rock, TX
47
Washington-Arlington-
Alexandria, DC-VA-MD-WV
46
Chicago-Naperville-Joliet, IL-
IN-WI
44
Denver-Aurora, CO
32
Philadelphia-Camden-
Wilmington, PA-NJ-DE-MD
23
Miami-Fort Lauderdale-
Pompano Beach, FL
22
State
Deal Count
Hawaii
5
Missouri
5
Montana
5
Nebraska
5
Wyoming
4
Maine
3
New Hampshire
3
North Dakota
3
Oklahoma
3
Alabama
2
Alaska
2
New Mexico
2
South Dakota
2
Vermont
2
Mississippi
1
Puerto Rico
1
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Methodology
Fundraising
We define VC funds as pools of capital raised for the purpose of investing in the equity of startup companies. In addition to funds raised
by traditional VC firms, PitchBook also includes funds raised by any institution with the primary intent stated above. Funds identifying as
growth-stage vehicles are classified as PE funds and are not included in this report. A fund’s location is determined by the country in which
the fund is domiciled; if that information is not explicitly known, the HQ country of the fund’s general partner is used. Only funds based
in the United States that have held their final close are included in the fundraising numbers. The entirety of a fund’s committed capital is
attributed to the year of the final close of the fund. Interim close amounts are not recorded in the year of the interim close.
Deals
We include equity investments into startup companies from an outside source. Investment does not necessarily have to be taken from an
institutional investor. This can include investment from individual angel investors, angel groups, seed funds, VC firms, corporate venture
firms, and corporate investors. Investments received as part of an accelerator program are not included, however, if the accelerator
continues to invest in follow-on rounds, those further financings are included. All financings are of companies headquartered in the US.
Angel & seed: We define financings as angel rounds if there are no PE or VC firms involved in the company to date and we cannot determine
if any PE or VC firms are participating. In addition, if there is a press release that states the round is an angel round, it is classified as such.
Finally, if a news story or press release only mentions individuals making investments in a financing, it is also classified as angel. As for
seed, when the investors and/or press release state that a round is a seed financing, or it is for less than $500,000 and is the first round as
reported by a government filing, it is classified as such. If angels are the only investors, then a round is only marked as seed if it is explicitly
stated.
Early-stage: Rounds are generally classified as Series A or B (which we typically aggregate together as early stage) either by the series of
stock issued in the financing or, if that information is unavailable, by a series of factors including: the age of the company, prior financing
history, company status, participating investors, and more.
Late-stage: Rounds are generally classified as Series C or D or later (which we typically aggregate together as late stage) either by the series
of stock issued in the financing or, if that information is unavailable, by a series of factors including: the age of the company, prior financing
history, company status, participating investors, and more.
Growth equity: Rounds must include at least one investor tagged as growth/expansion, while deal size must either be $15 million or more
(although rounds of undisclosed size that meet all other criteria are included). In addition, the deal must be classified as growth/expansion or
later-stage VC in the PitchBook Platform. If the financing is tagged as late-stage VC it is included regardless of industry. Also, if a company is
tagged with any PitchBook vertical, excepting manufacturing and infrastructure, it is kept. Otherwise, the following industries are excluded
from growth equity financing calculations: buildings and property, thrifts and mortgage finance, real estate investment trusts, and oil & gas
equipment, utilities, exploration, production and refining. Lastly, the company in question must not have had an M&A event, buyout, or IPO
completed prior to the round in question.
Corporate VC: Financings classified as corporate VC include rounds that saw both firms investing via established CVC arms or corporations
making equity investments off balance sheets or whatever other non-CVC method actually employed.
Capital efficiency score: Our capital efficiency score was calculated using companies that had completed an exit (IPO, M&A or PE Buyout)
since 2006. The aggregate value of those exits, defined as the pre-money valuation of the exit, was then divided by the aggregate amount
of VC that was invested into those companies during their time under VC backing to give a Multiple On Invested Capital (MOIC). After the
average time to exit was calculated for each pool of companies, it was used to divide the MOIC figure and give us a capital efficiency score.
Exits
We include the first majority liquidity event for holders of equity securities of venture-backed companies. This includes events where there
is a public market for the shares (IPO) or the acquisition of majority of the equity by another entity (corporate or financial acquisition). This
does not include secondary sales, further sales after the initial liquidity event, or bankruptcies. M&A value is based on reported or disclosed
figures, with no estimation used to assess the value of transactions for which the actual deal size is unknown.
COPYRIGHT © 2018 by PitchBook Data, Inc. All rights reserved. No part of this publication may be reproduced in any form or by any means—graphic, electronic, or
mechanical, including photocopying, recording, taping, and information storage and retrieval systems—without the express written permission of PitchBook Data, Inc. Contents
are based on information from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. Nothing herein should be construed as any past, current
or future recommendation to buy or sell any security or an offer to sell, or a solicitation of an offer to buy any security. This material does not purport to contain all of the
information that a prospective investor may wish to consider and is not to be relied upon as such or used in substitution for the exercise of independent judgment.
35
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Why we teamed up
Meet the PitchBook-NVCA Venture Monitor
NVCA is recognized as the go-to organization for
venture capital advocacy, and the statistics we
release are the industry standard. PitchBook is
the leading data software provider for venture
capital professionals, serving more than 1,800
clients across the private market. Our partnership
with PitchBook empowers us to unlock more
insights on the venture ecosystem and better
advocate for an ever-evolving industry.
A brand-new, quarterly report that
details venture capital activity
and delivers insights to inform your
investment strategy. PitchBook’s
data will also bolster our
year-in-review publication.
The PitchBook Platform
Help us help you
More data. Less dough.
T H E P E R K S O F P A R T N E R S H I P
As an NVCA member, your free access to the
PitchBook Platform includes five advanced
searches and five profile views per month.
We will email quarterly surveys to each
member firm, which will give you the
opportunity to report your activity to
PitchBook. The data you provide will
not only power PitchBook-NVCA reports,
but also ensure your firm is represented
accurately in the PitchBook Platform. If
you’d like to send your quarterly activity
report directly to PitchBook, email
research@pitchbook.com.
Our members get 10% off a new subscription
to the PitchBook Platform (up to a
$10,000 value) or one free, additional seat.
If your firm was a PitchBook client prior
to September 14, 2016, you’re eligible for
one of these discounts the next time you
renew your contract.
The 411 on the PitchBook
and National Venture Capital
Association (NVCA) partnership
Fundraise faster with targeted searches for
limited partners who will likely be interested
in your fund.
Conduct better due diligence by diving deep
into a company’s round-by-round financing
history, executive team and market traction.
Price deals with confidence using pre- and
post-money valuations, public and private
comps, cap tables and series terms.
Find promising investors quickly by zeroing
in on other firms or strategic acquirers
whose investment preferences match your
portfolio company.
PitchBook Data, Inc. | 206.623.1986 | pitchbook.com/nvca
National Venture Capital Association | 202.864.5920 | nvca.org
Ready to get started with the PitchBook Platform? Go to pitchbook.com/nvca