NVCA Yearbook 2014

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NATIONAL VENTURE
CAPITAL ASSOCIATION
YEARBOOK 2014
INCLUDING STATISTICS FROM THE
PricewaterhouseCoopers/National Venture Capital Association
MoneyTree Report based on data from Thomson Reuters
2014 National Venture Capital Association Yearbook | 1
NVCA THOMSON REUTERS
March 2014
Dear Colleague:
We are delighted to present to you the NVCA 2014 Yearbook, prepared by Thomson Reuters. This is the
17
th
edition in a series launched in early 1998. Since then, much has changed in the industry. One thing
that has not changed, however, is our commitment to bring accurate and responsible transparency to this
powerful economic force called venture capital. You will fnd in this publication new and updated charts
that track investment activity in the United States. Refecting our dynamic environment, for the frst time
we provide a chapter on Growth Equity an asset subclass that did not exist in its present form when we
printed the frst edition of this publication.
More changes are already in the works. For example, in recognition of the strong and broad emergence of
corporate venture capital groups and direct corporate investment over the past few quarters, we will soon
be changing our methodology to be more inclusive of solo (i.e., without a traditional venture investor in
the round) and early corporate investment into companies. Further, we will also include corporate direct
investment from the corporation itself, not just from a separate or captive entity. Stay tuned.
The industrys goal remains the same: to create fast-growing and sustainable companies, introduce new
technologies, and improve medical care and patient well-being, while providing an attractive return to
those who trust the industry with their capital. Whether by traditional venture capital, corporate venture
capital, growth equity, or a number of new and energized investment vehicles, we are here to report that
the beat goes on.
As always, your feedback and suggestions are welcome. Please feel free to contact us at research@nvca.
org or through any NVCA director or staff member.
Very truly yours,
Diana Frazier Bobby Franklin John S. Taylor
FLAG Capital Management NVCA President and CEO NVCA Head of Research
NVCA Director and
Chair, Research Committee
2 | 2014 National Venture Capital Association Yearbook
THOMSON REUTERS NVCA

NVCA BOARD OF DIRECTORS 2013-2014
EXECUTIVE COMMITTEE
Josh Green Scott Sandell
Mohr, Davidow Ventures New Enterprise Associates
Chair Chair-Elect
Anne Rockhold Jonathan Callaghan
Accel Partners True Ventures
Treasurer Executive Committee At-Large
Bruce Evans Jonathan Leff
Summit Partneer Deerfeld Management
Executive Committee At-Large Executive Committee At-Large,
Research Committee
AT-LARGE
Diana Frazier Mark Leschly
FLAG Capital Rho Ventures
Research Chair Research Committee

John Backus Maria Cirino
New Atlantic Ventures .406 Ventures

David Douglass Claudia Fan Munce
Delphi Ventures IBM Venture Capital Group
Norm Fogelsong Venky Ganesan
Institutional Venture Partners Menlo Ventures

Robert Goodman Mark Gorenberg
Bessemer Venture Partners Zetta Venture Partners

Jason Green Adam Grosser
Emergence Capital Partners Silver Lake Kraftwerk

James Healy Ross Jaffe
Sofnnova Ventures Versant Ventures

Scott Kupor Ray Leach
Andreessen Horowitz Jumpstart, Inc

David Lincoln Robert Nelsen
Element Partners ARCH Venture Partners

Art Pappas Sue Siegel
Pappas Ventures GE Ventures

2014
National Venture Capital Association Yearbook
For the National Venture Capital Association
Prepared by Thomson Reuters
Copyright 2014 Thomson Reuters
The information presented in this report has been gathered with the utmost care
from sources believed to be reliable, but is not guaranteed. Thomson Reuters disclaims
any liability including incidental or consequential damages arising from
errors or omissions in this report.
National Venture Capital Association
1655 Fort Myer Drive, Suite 850
Arlington, Virginia 22209-3114
Telephone: 703-524-2549
Telephone: 703-524-3940
www.nvca.org
President and CEO
Bobby Franklin
President Emeritus
Mark G. Heesen
Head of Research
John S. Taylor
Senior Vice President of Federal Policy and Political Advocacy
Jennifer Connell Dowling
Vice President of Federal Life Science Policy
Kelly Slone
Vice President of Federal Policy and Political Advocacy
Emily Baker

Vice President of Communications
Ben Veghte

Vice President of Membership and Member Firm Liaison
Janice Mawson
Vice President of Administration
Roberta Catucci

Director of Business Development
Hannah Veith
Manager of Administration and Meetings
Allyson Chappell

Accounting Manager
Beverley Badley
Research Lab
Mavis Moulterd (Emeritus), Annie Black, Liberty Benjamin
Lab Assistants
Thea Shepherd, Lexi Oscar, Gracie Baker
Thomson Reuters
3 Times Square, 18th Floor
New York, NY 10036
Telephone: 646-223-4431
Fax: 646-223-4470
www.thomsonreuters.com
Global Head of Deals & Private Equity
Stephen N. Case II
Head of Deals and Private Equity Operations
Katarzyna Namiesnik
Global Business Manager Private Equity
Jim Beecher
Editor-in-Charge
David Toll
Global Private Equity Operations Manager
Anna Aquino-Chavez
Press Management
Matthew Toole
Senior Content Specialist
Michael D. Smith
Content Specialist
Paul Pantalla
Data Specialist
Francis S. Tan
Senior Art Director
David Cooke
Sales Manager Publications (Buyouts, VCJ, peHUB)
Greg Winterton (646-223-6787)
ThomsonONE.com Sales:
1-877-365-1455
National Venture Capital Association 2014 Yearbook
TABLE OF CONTENTS
What is Venture Capital? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
Industry Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . 11
Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Exits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . 14
Industry Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . 17
Capital Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
Investments.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
Exits: IPOs and Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71
Growth Equity Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85
Appendix A: Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
Appendix B: MoneyTree Report Criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105
Appendix C: MoneyTree Geographical Defnitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107
Appendix D: Industry Codes (VEICs). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Appendix E: Industry Sector VEIC Ranges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .113
Appendix F: Stage Defnitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .115
Appendix G: Data Sources and Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117
Appendix H: International Convergence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .119
Appendix I: US Accounting Rulemaking and Valuation Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .121
Appendix J: Non-US Private Equity . . . . . . . . . . . . . . .. . . . . . . . . . . . . . .. . . . . . . . . . . . . . .. . . . . . . . . . . . . . .. . . . . . . . . 125
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WHAT IS VENTURE CAPITAL?
Venture capital has enabled the United States to support its entrepreneur-
ial talent and appetite by turning ideas and basic science into products
and services that are the envy of the world. Venture capital funds build
companies from the simplest form perhaps just the entrepreneur and an
idea expressed as a businessplan to freestanding, mature organizations.
Risk Capital for Business
Venture capital frms are professional, institutional managers of risk capi-
tal that enables and supports the most innovative and promising compa-
nies. This money funds new ideas that could not be fnanced with tradi-
tional bank fnancing, that threaten established products and services in a
corporation, and that typically require fve to eight years to be launched.
Venture capital is quite unique as an institutional investor asset class.
When an investment is made in a company, it is an equity investment in a
company whose stock is essentially illiquid and worthless until a company
matures fve to eight years down the road. Follow-on investment provides
additional funding as the company grows. These rounds, typically oc-
curring every year or two, are also equity investment, with the shares al-
located among the investors and management team based on an agreed
valuation. But, unless a company is acquired or goes public, there is
little actual value.Venture capital is a long-term investment.
More Than Money
The U.S. venture industry provides the capital to create some of the most
innovative and successful companies. But venture capital is more than
money. Venture capital partners become actively engaged with a com-
pany, typically taking a board seat. With a startup, daily interaction with
the management team is common. This limits the number of startups in
which any one fund can invest. Few entrepreneurs approaching venture
capital frms for money are aware that they essentially are asking for 1/6
of a person! Yet that active engagement is critical to the success of the
fedgling company. Many one- and two-person companies have received
funding but no one- or twoperson company has ever gone public!Along
the way, talent must be recruited and the company scaled up. Ask any
venture capitalist who has had an ultra-successful investment and he or
she will tell you that the company that broke through the gravity evolved
from the original business plan concept with the careful input of an expe-
rienced hand.
Deal Flows Where The Buys Are
For every 100 business plans that come to a venture capital frm for fund-
ing, usually only 10 or so get a serious look, and only one ends up being
funded. Theventure capital frm looks at the management team, the con-
cept, the marketplace, ft to the funds objectives, the value-added po-
tential for the frm, and the capital needed to build a successful business.
A busy venture capital professionals most precious asset is time. These
days, a business concept needs to address world markets, have superb
scalability, be made successful in a reasonable timeframe, and be truly
innovative. A concept that promises a 10 or 20 percent improvement on
something that already exists is not likely to get a close look.
Many technologies currently under development by venture capital frms
are truly disruptive technologies that do not lend themselves to being em-
braced by larger companies whose current products could be cannibalized
by this. Also, with the increased emphasis on public company quarterly
results, many larger organizations tend to reduce spending on research and
development and product development when things get tight. Many tal-
ented teams have come to the venture capital process when their projects
were turned down by their companies.
Common Structure Unique Results
While the legal and economic structures used to create a venture capi-
tal fund are similar to those used by other alternative investment asset
classes, venture capital itself is unique. Typically, a venture capital frm
will create a Limited Partnership with the investors as LPs and the frm
itself as the General Partner. Each fund, or portfolio, is a separate part-
nership. A new fund is established when the venture capital frm obtains
necessary commitments from its investors, say $100 million. The money
is taken from investors as the investments are made. Typically, an initial
funding of a company will cause the venture fund to reserve three or four
times that frst investment for follow-on fnancing. Over the next three to
eight or so years, the venture frm works with the founding entrepreneur to
grow the company. The payoff comes after the company is acquired or
goes public. Although the investor has high hopes for any company get-
ting funded, only one in six ever goes public and one in three is acquired.
Venture Capital Backed Companies
Known for Innovative Business Models
Employment at IPO and Now
Company As of IPO Current # Change
The Home Depot
650
331,000 330,350
Starbucks Corporation 2,521 160,000 157,479
Staples 1,693 89,019 87,326
Whole Foods Market, Inc. 2,350 69,500 67,150
eBay
138 31,500 31,362
Venture Capital Backed Companies
Known for Innovative Technology Products
Employment at IPO and Now
Company As of IPO Current # Change
Microsoft 1,153 94,000 92,847
Intel Corporation 460 100,100 99,640
Medtronic, Inc. 1,287 45,000 43,713
Apple Inc. 1,015 76,100 75,085
Google 3,021 53,861 50,840
JetBlue 4,011 12,070 8,059
Source: Global Insight; Updated fromThomsonOne 2/2013
Economic Alignment of all Stakeholders
An American Success Story
Venture capital is rare among asset classes in that success is truly shared.
It is not driven by quick returns or transaction fees. Economic success
occurs when the stock price increases above the purchase price. When
a company is successful and has a strong public stock offering, or is ac-
quired, the stock price of the company refects its success. The entrepre-
neur benefts from appreciated stock and stock options. The rank and fle
employees throughout the organization historically also do well with their
stock options. The venture capital fund and its investors split the capi-
tal gains per a pre-agreed formula. Many college endowments, pension
funds, charities, individuals, and corporations have benefted far beyond
the risk-adjusted returns of the public markets.
Whats Ahead
Much of venture capitals success has come from the entrepreneurial spirit
pervasive in theAmerican culture, fnancial recognition of success, access
to good science, and fair and open capital markets. It is dependent upon
a good fow of science, motivated entrepreneurs, protection of intellec-
tual property, and a skilled workforce. The nascent deployment of ven-
ture capital in other countries is gated by a countrys or regions cultural
ft, tolerance for failure, services infrastructure that supports developing
companies, intellectual property protection, effcient capital markets, and
the willingness of big business to purchase from small companies.
EXECUTIVE SUMMARY
During 2013, many of the metrics describing the venture capital indus-
try in the United States were similar to those of the prior three years, with
the exception of a pickup in the breadth of the IPO markets. The decline
in capital managed continued as expected, but not as much as some were
anticipating. A record proportion of venture deals focused on companies
in the seed and early stages, while a number of companies long in the
portfolios fnally went public, led by Biotechnology companies in the frst
half of 2013. Investment in early-stage life science companies continued
to fall during the year, although a fourth-quarter increase in frst fundings
of Biotechnology companies was encouraging.
Fundraising remained very challenging for the majority of venture
frms. This is largely because of a dearth of healthy exits through 2012
that would have distributed yet-unrealized returns to current fund inves-
tors. Aside from the Facebook IPO in 2012 ($16.0B of the $21.5B raised
in 2012), 2013 was a much-improved year with 81 venture-backed IPOs.
Remarkably, over half of them were Biotechnology companies. Early
signs for 2014 suggest that IPO momentum carried forward into at least
the frst part of the year.
A healthy venture capital ecosystem requires its metrics to be in bal-
ance. And while the quality of new business opportunities, known as deal
fow, remains very high and the best opportunities are getting funded,
stresses remain.
Introduction
The National Venture Capital Association 2014 Yearbook provides
a summary of venture capital activity in the United States. This ranges
from investments into portfolio companies to capital managed by general
partners to fundraising from limited partners to valuations of companies
receiving venture capital investments to exits of the investments by ei-
ther IPOs or mergers and acquisitions. The statistics for this publication
were assembled primarily from the MoneyTree Report by Pricewater-
houseCoopers and the National Venture Capital Association, based on
data from Thomson Reuters and analyzed through the Thomson ONE.
com (formerly VentureXpert) database of Thomson Reuters, which has
been endorsed by the NVCA as the offcial industry activity database.
Subscribers to Thomson ONE can recreate most of the charts in this pub-
lication and report individual deal detail and more granular statistics than
those provided herein.

Industry Resources
The activity level of the US venture capital industry is roughly half
of what it was at the 2000-era peak. For example, in 2000, 1,050 frms
each invested $5 million or more during the year. In 2013, the count was
roughly half that at 548.
Venture capital under management in the United States by the end of
2013 decreased to $192.9 billion. However, looking behind the numbers,
we know that the industry continues to contract from the circa 2004 high
of $288.9 billion. The peak capital under management that year was a
statistical anomaly caused when funds raised at the height of the 2000 tech
bubble were joined by new capital raised post bubble.
The slight downtick in frms and capital managed (Fig. 1.04) in 2013
understates a consolidating industry. The average venture capital frm
shrunk to 6.7 principals per frm from 8.7 just six years earlier. The corre-
sponding drop in headcount to under 6,000 principals is almost one-third
lower than 2007 levels. This meant that there was a general increase in the
average amount of capital managed by each principal. It is possible going
forward that the number of principals per frm will increase as the number
of frms decreases. This is because the bulk of the capital being commit-
ted today is being raised by larger, specialty, and boutique frms. For our
purposes here, we defne a principal to be someone who goes to portfolio
company board meetings. That is, deal partners would be included and
frm CFOs would not be included.
Contrary to some popular misconceptions, only 43 frms managed more
than $1 billion. By comparison, 277 frms managed less than $25 million.
Commitments
The year 2013 continued to be a very challenging fundraising year for
most venture capital frms in the United States. This was due to a lack of
recent distributions caused by the tight exit markets, lackluster returns by
many venture funds over the past decade compared with the prior decade,
and a challenge for the largest alternative asset investors to place money in
many of the smaller funds in this asset class because of scale. Only $16.8
billion was raised by 187 funds. This was considerably less than the $19.6
billion raised in 2012 or the $19.0 billion raised in 2011. The amount of
new commitments each year by venture capital funds continued to be less
than the amount they invested in companies.
Investments
Measuring industry activity by the total dollars invested in a given year
shows that the industry has remained generally in the $20 billion to $30
billion range since 2002. In 2013, $29.5 billion was invested in 3,382
companies through 4,041 deals. The number of deals was 4% higher than
2012 counts, but was essentially the same as 2011. The number of frst-
time fundings increased in 2013 to 1,334 companies from the previous
1,275, but it remains near the top of the healthy range of 1,000 to 1,400
Figure 1.0
Venture Capital Under Management Summary Statistics
1993 2003 2013
No. of VC Firms in Existence 370 951 874
No. of VC Funds in Existence 613 1,788 1,331
No. of Professionals 5,217 14,777 5,891
No. of First Time VC Funds Raised 25 34 53
No. of VC Funds Raising Money This Year 93 160 187
VC Capital Raised This Year ($B) 4.5 9.1 16.8
VC Capital Under Management ($B) 29.3 263.9 192.9
Avg VC Capital Under Mgt per Firm ($M) 79.2 277.5 220.7
Avg VC Fund Size to Date ($M) 40.2 94.4 110.3
Avg VC Fund Size Raised This Year ($M) 48.3 102.9 89.7
Largest VC Fund Raised to Date ($M) 1,775.0 6,300.0 6,300.0
frst-time fundings in a year. Further parsing the data shows 50% of the in-
vestment dollars going to California companies, down from 53% in 2012
but consistent with the previous three years. The year 2013 saw a record
56% of the fnancing rounds going to seed and early stage companies,
compared with a more typical one-third of deals. A carefully watched sta-
tistic is the investment in the life sciences. It is possible that the downward
plummet in frst-time life sciences investment is starting to reverse, led
by Biotechnology, but it is still too early to be sure. Corporate Venture
investment continues to gain considerable strength and presence in the
overall industry.
Software was the leading sector in 2013, receiving 37.3% of the total
dollars. The second largest sector was Biotechnology, which was less than
half that amount at 15.4% of total investment. Among frst fundings, Soft-
ware led the way with 591 companies getting their initial venture capital
rounds. This is more than 46% of the frst fundings. Again in 2013, the
second most active frst-funding sector is Media and Entertainment at 170
frst fundings.
California-domiciled venture capital frms made investments in 38
states in 2013. Approximately 48% of all the money invested in Califor-
nia came from California-domiciled frms. Conversely, California-based
frms concentrated 68% of their investment dollars within the state.
The number and reach of corporate venture capital groups increased
in 2013, along with the visibility of this group. These groups provided
an estimated 10.5% of the venture capital invested by all venture groups.
They were involved in 16.9% of the deals the highest level in fve years.
Going forward, all signs suggest that these groups are becoming more
involved alongside traditional venture frms in deals, as well as initiating
corporate venture group syndicates to do deals in lieu of, or in advance of,
investment rounds by traditional venture frms.
Exits
Once successful portfolio companies mature, venture funds generally
exit their positions in those companies by taking them public through an
initial public offering (IPO) or by selling them to presumably larger orga-
nizations (acquisition, M&A, or trade sale). This then lets the venture
fund distribute the proceeds to investors, raise a new fund for future in-
vestment, and invest in the next generation of companies. We consider
each type of exit separately.
During 2013, 81 venture-backed companies went public in the United
States, marking the strongest full-year total for the number of new ven-
ture-backed listings since 2007. Remarkably, more than half of them were
Biotechnology IPOs, many of those being modestly sized. While the total
dollars raised in 2012 was higher at $21.5 billion, it is important to re-
member that $16.0 billion of that came from the Facebook IPO alone.
The remaining $5.5 billion was raised by the remaining 48 IPOs in 2012.
It was a very different story in 2013. $11.1 billion was raised by 81 com-
panies. The increase in mean and median time to exit refects the fact that
many of these IPOs were mature companies, and many of them were in
the life sciences space, which had been awaiting an IPO opportunity for
months, and in some cases, years.
NVCA is encouraged by the increase in smaller IPOs and biotech IPOs
in light of its 2012 legislative successes with the JOBS Act and creating a
pathway for FDA Reform.
The M&A space continued to soften in 2013, with the total number of
deals falling from 473 in the prior year to 376. Total proceeds fell by 27%.
Note that only 94 of the 376 acquisitions had reported deal values. Histori-
cally, deals with unreported sales prices are fairly diminutive, and in many
cases, fre sales. However, an increasing number of deal term sheets spec-
ify a non-disclosure restriction on all parties. So going forward, all but the
largest and most visible acquisitions may be hard to measure. Observers
have wondered why, given the huge amounts of cash on the balance sheets
of technology and Biotechnology giants, more acquisitions are not occur-
ring. We did see a furry of acquisitions in early 2014, perhaps signaling
an increase in that kind of activity.
Growth Equity
This edition of the NVCA Yearbook, prepared by Thomson Reuters, for
the frst time profles US growth equity investment in its own chapter. The
NVCA believes growth equity investing is an important segment of the
overall venture capital industry. Venture capitalists help create and grow
companies; growth equity investors are strongly focused on the growth
component of that mission and help companies scale through fat part of
their hiring curves. The NVCA also believes that growth equity invest-
ing is a critical component of the emerging growth company fnancing
continuum and has become, in many respects, the private alternative to
the public markets for both emerging growth companies and their earlier
stage venture capital backers.
Growth equity really emerged as an asset class in 2000 and continues
strong today. In 2013, we identifed 342 growth equity deals in the United
States. This compares with 406 in 2012, but is very much in line with
the past several years. A disclosed $12.3 billion in equity investment was
reported for 2013. This does not count the approximately 105 deals for
which no dollar equity amounts were disclosed.
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Figure 2.0
Capital Under Management
U.S. Venture Funds ($ Billions)
1985 to 2013
0
20
40
60
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120
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Figure 3.0
Capital Commitments
To U.S. Venture Funds ($ Billions)
1985 to 2013
Figure 5.0
Venture Capital Investments in 2013 By Industry Group
Industry Group # Companies # Deals Investment
Amt ($Bil)
# Companies # Deals Investment
Amt ($Bil)
Information Technology 2,360 2,784 20 1009 1009 3.5
Medical/Health/Life Science 649 816 6.9 167 167 1.2
Non-High Technology 373 440 2.7 157 157 0.4
Total 3,382 4,041 29.6 1,334 1,334 5.1
Initial Investments All Investments
0
20
40
60
80
100
120
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Year
Figure 4.0
Venture Capital Investments ($ Billions)
1985 to 2013
Seed
3%
Early Stage
34%
Expansion
33%
Later Stage
30%
Figure 6.0
Venture Capital Investments in 2013
By Stage
Biotechnology
15%
Business Products and
Services 0.4%
Computers and Peripherals 2%
Consumer Products and
Services 4%
Electronics/Instrumentation
1%
Financial Services
2%
Healthcare Services
1%
Industrial/Energy
5%
IT Services
7%
Media and Entertainment
10%
Medical Devices and
Equipment
7%
Networking and Equipment
2%
Retailing/Distribution
1%
Semiconductors
2%
Software
37%
Telecommunications
2%
Other
0.2%
Figure 7.0
By Industry Sector
Figure 8.0 2013 Investments By State
State Number of
Companies
Pct of
Total
Investment
($ Millions)
Pct of
Total
California 1,280 40% 14,769.7 50%
Massachusetts 326 10% 3,079.3 10%
New York 287 9% 2,870.4 10%
Texas 101 3% 1,315.5 4%
Washington 134 4% 913.2 3%
Maryland 76 2% 664.5 2%
Virginia 85 3% 593.8 2%
Pennsylvania 154 5% 446.5 2%
Illinois 49 2% 434.9 1%
Colorado 62 2% 428.8 1%
All Others 676 21% 4,028.6 14%
Total 3,230 29,545.2
Figure 9.0 Venture-Backed IPOs
Year Num of IPOs Offer Amount
($Mil)
Med Offer Amt
($Mil)
Mean Offer Amt
($Mil)
Post Offer Value
($Mil)
Med Post Value
($Mil)
Mean Post Value
($Mil)
Median Age At
IPO (Years)
Mean Age At IPO
(Years)
1985 48 763 13 16 2,020 37 48 3.0 4.0
1986 105 2,417 13 23 166,032 52 1866 4.0 4.0
1987 86 2,125 17 25 10,972 46 155 4.0 4.0
1988 43 769 15 18 21,117 51 571 3.0 4.0
1989 42 873 16 21 4,443 50 131 4.0 4.0
1990 47 1,108 20 24 5,886 60 178 4.0 4.0
1991 120 3,726 27 31 17,611 81 202 5.0 5.0
1992 150 5,443 24 36 15,955 68 146 5.0 5.0
1993 175 6,154 25 35 14,808 75 130 5.0 6.0
1994 138 3,952 24 29 10,344 68 94 5.0 5.0
1995 184 7,859 36 43 19,300 104 152 4.0 5.0
1996 256 12,716 35 50 51,511 112 240 3.0 4.0
1997 141 5,829 33 41 19,101 99 148 3.0 6.0
1998 78 4,125 43 53 24,655 164 324 3.0 3.0
1999 280 23,975 69 86 147,341 304 532 3.0 3.0
2000 238 27,443 83 115 108,783 325 494 3.0 4.0
2001 37 4,130 80 112 19,233 327 534 4.0 4.0
2002 24 2,333 89 97 8,322 266 347 3.0 5.0
2003 26 2,024 71 78 7,412 252 285 5.0 6.0
2004 82 10,032 70 122 50,268 254 613 6.0 6.0
2005 59 5,113 68 87 39,702 202 673 5.0 5.0
2006 67 7,065 86 105 71,124 283 1078 5.0 6.0
2007 91 12,339 98 136 68,203 365 749 6.0 6.0
2008 7 765 83 109 3,645 278 521 7.0 7.0
2009 13 1,980 123 152 9,192 548 707 6.0 7.0
2010 70 7,774 93 111 114,981 428 1643 5.0 6.0
2011 51 10,690 106 210 94,657 606 1856 6.0 7.0
2012 49 21,460 89 438 122,168 371 2493 7.0 8.0
2013 81 11,068 91 137 62,700 354 784 7.0 8.0
*Age at IPO is dened as time elapsed from rst funding round until IPO date.
Figure 10.0
Venture-Backed Mergers & Acquisitions by Year
Year Number Total Number Known Price Average
1985 7 3 300.2 100.1
1986 8 1 63.4 63.4
1987 11 4 667.2 166.8
1988 17 9 920.7 102.3
1989 21 10 746.9 74.7
1990 19 7 120.3 17.2
1991 16 4 190.5 47.6
1992 69 43 2119.1 49.3
1993 59 36 1332.9 37.0
1994 84 57 3208.4 56.3
1995 92 58 3801.8 65.5
1996 108 76 8230.8 108.3
1997 145 100 7798.0 78.0
1998 189 113 8002.0 70.8
1999 228 155 38710.6 249.7
2000 379 245 79996.4 326.5
2001 384 175 25115.6 143.5
2002 365 166 11913.2 71.8
2003 323 134 8240.8 61.5
2004 402 199 28846.1 145.0
2005 446 201 19717.3 98.1
2006 484 208 24291.0 116.8
2007 488 201 30745.5 153.0
2008 417 134 16236.9 121.2
2009 351 109 12364.9 113.4
2010 523 150 17707.3 118.0
2011 490 169 24093.2 142.6
2012 473 132 22694.2 171.9
2013 376 94 16586.5 176.5
($ Millions)
Figure 11.0
Growth Equity Investments ($ Billions)
2000 to 2013*
0
5
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30
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Totals include only disclosed amounts. Many growth equity deal amounts are not reported.
INDUSTRY RESOURCES
The activity level of the US venture capital industry is roughly half of what it was at the 2000-era peak. For example, in 2000, 1,050 frms each invested
$5 million or more during the year. In 2013, the count was roughly half that at 548.
Venture capital under management in the United States by the end of 2013 decreased to $192.9 billion as calculated using the methodology described
below. However, looking behind the numbers, we know that the industry continues to contract from the circa 2006 high of $288.9 billion. The peak
capital under management that year was a statistical anomaly caused by funds raised at the height of the 2000 tech bubble were joined by new capital
raised post bubble.
The slight downtick in frms and capital managed (Fig. 1.04) in 2013 perhaps understates a consolidating industry. The average venture capital frm
shrunk to 6.7 principals per frm from 8.7 just six years earlier. The corresponding drop in headcount to under 6,000 principals is almost one-third
lower than 2007 levels. This meant that there was a general increase in the average amount of capital managed by each principal. It is possible going
forward that the number of principals per frm will increase as the number of frms decreases. This is because the bulk of the capital being committed
today is being raised by larger, specialty, and boutique frms. For our purposes here, we defne a principal to be someone who goes to portfolio company
board meetings. That is, deal partners would be included and frm CFOs would not be included.
Geographic location of the largest venture frms is quite concentrated. 49% of the industrys California-domiciled frms manage capital, although these
frms may be actively investing in other states and countries. This concentration has been consistent for several years and may increase going forward,
given the movement of some East Coast funds westward. Taken together, the top fve states (California, Massachusetts, New York, Connecticut, and
Illinois) hold 81.1% of total venture capital in this country, essentially the same as a year ago.
Contrary to some popular misconceptions, only 43 frms managed more than $1 billion. By comparison, 277 frms managed less than $25 million.
Methodology
Historically, we have calculated industry size using a rolling eight
years of fundraising proxy for capital managed, number of funds, num-
ber of frms, etc. The number of frms in existence will vary on a rolling
eight-year basis as frms raise new funds or do not raise funds for more
than eight years. Currently, we know the industry is consolidating, but the
eight-year model now includes fund vintage years 2006-2013.
Under this methodology, we estimate that there are currently 874 frms
with limited partnerships in existence. To clarify, this is actually stating
that there are 874 frms that have raised a venture capital fund in the last
eight years. In reality, only 548 of them invested at least $5 million in
companies in 2013, and 136 of them invested more than $5 million in frst
rounds for a company.
For this publication, we are primarily counting the number of frms with
limited partnerships and are excluding other types of investment vehicles.
From that description, it may appear that the statistics for total industry
resources may be underestimated. However, this must be balanced with
the fact that capital under management by captive and evergreen funds is
diffcult to compare equitably to typical limited partnerships with fxed
lives. For this analysis only, the frms counted for capital under manage-
ment include frms with fxed-life partnerships and venture capital funds
they raised. If a frm raised both buyout and venture capital funds, only
the venture funds would be counted in the calculation of venture capital
under management.
Venture capital under management can be a complex statistic to esti-
mate. Indeed, capital under management reported by frms can differ from
frm to frm as theres not one singular defnition. For example, some frms
include only cumulative committed capital, others may include commit-
ted capital plus capital gains, and still other frms defne it as committed
capital after subtracting liquidations. To complicate matters, it is diffcult
to compare these totals to European private equity frms, which include
capital gains as part of their capital under management measurements.
For purposes of the analysis in this publication, we have tried to clarify
the industry defnition of capital under management as the cumulative to-
tal of committed capital less liquidated funds or those funds that have
completed their life cycle. Typically, venture capital frms have a stated
10-year fxed life span, except for life science funds, which are often
established as 12-year funds. Figure 1.09 shows the reality of fund life.
Thomson Reuters calculates capital under management as the cumulative
amount committed to funds on a rolling eight-year basis. Current capital
under management is calculated by taking the capital under management
calculation from the previous year, adding in the current years funds
commitments, and subtracting the capital raised eight years prior.
For this analysis, Thomson Reuters classifes venture capital frms us-
ing four distinct types: private independent frms, fnancial institutions,
corporations, and other entities. Private independent frms are made up
of independent private and public frms including both institutionally and
non-institutionally funded frms and family groups. Financial institu-
tions refers to frms that are affliates and/or subsidiaries of investment
banks and non-investment bank fnancial entities, including commercial
banks and insurance companies. The corporations classifcation includes
venture capital subsidiaries and affliates of industrial corporations. In
2013, we will modify the methodology to refect virtually all direct cor-
porate investment because many of the corporate venture investors do not
operate out of a separate fund or group. The capital under management
statistics reported in this section consist primarily of venture capital frms
investing through limited partnerships with fxed commitment levels and
fxed lives and do not include non-vintage evergreen funds or true cap-
tive corporate industrial investment groups without fxed commitment
levels. The term evergreen funds refers to funds that have a continuous
infusion of capital from a parent organization, as opposed to the fxed life
and commitment level of a closed-end venture capital fund.
Figure 1.01
Capital Under Management U.S. Venture Funds ($ Billions)
1985 to 2013
0
50
100
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Figure 1.03
Distribution of Firms By Capital Managed 2013
Figure 1.02
Total Capital Under Management By Firm Type 1985 to 2013
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Private Independent 11,766 14,721 17,459 18,850 22,369 22,722 21,893 22,643 25,162 28,490 33,308 40,201 51,940 76,560 119,121
Financial Institutions 3,388 3,520 3,447 3,190 2,719 2,793 2,384 2,214 2,431 2,873 3,688 5,070 7,061 10,238 15,291
Corporations 1,582 1,545 1,895 1,989 1,931 1,963 1,907 2,032 1,517 1,564 1,526 2,219 2,531 3,425 8,169
Other 864 914 900 871 781 722 616 312 190 273 378 410 667 877 1,119
Total 17,600 20,700 23,700 24,900 27,800 28,200 26,800 27,200 29,300 33,200 38,900 47,900 62,200 91,100 143,700
Figure 1.02 (Continued)
Total Capital Under Management By Firm Type 1985 to 2013
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Private Independent 187,356 221,327 222,028 224,828 233,595 241,637 255,315 239,643 194,573 171,016 174,722 186,032 186,676 179,202
Financial Institutions 22,980 24,459 23,945 23,015 21,659 21,110 18,325 13,914 6,034 4,708 5,620 7,734 7,970 6,615
Corporations 12,995 14,153 14,126 13,886 13,627 13,467 13,297 8,990 4,294 3,125 3,688 4,860 4,892 6,401
Other 1,469 2,061 2,201 2,170 2,219 1,986 1,963 1,754 1,399 851 670 674 662 682
Total 224,800 262,000 262,300 263,900 271,100 278,200 288,900 264,300 206,300 179,700 184,700 199,300 200,200 192,900
0
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164
113 114
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82
53
43
This chart shows capital committed to US venture rms in active funds. While much of the capital is managed by larger rms, of the 808 rms included in this calculation at the
end of 2013, roughly 62% of them (498) managed $100 million or less. By comparison, just 43 rms managed active funds totaling more than $1 billion.
Figure 1.04
Fund and Firm Analysis 2013
Fund
Vintage
Year
Total
Cumulative
Funds
Total
Cumulative
Firms
Total
Cumulative
Capital ($B)
Existing
Funds
Firms That Raised
Funds in the Last
8 Vintage Years
Capital
Managed
($B)
Avg Fund
Size ($M)
Avg Firm
Size ($M)
1985 631 323 20 532 294 17.6 33.1 59.9
1986 707 353 23.4 590 324 20.7 35.1 63.9
1987 810 388 27.4 670 353 23.7 35.4 67.1
1988 888 406 30.9 701 365 24.9 35.5 68.2
1989 980 435 35.9 728 380 27.8 38.2 73.2
1990 1037 451 38.2 716 383 28.2 39.4 73.6
1991 1075 458 40.4 639 360 26.8 41.9 74.4
1992 1147 478 44.1 601 352 27.2 45.3 77.3
1993 1244 509 49.3 613 370 29.3 47.8 79.2
1994 1342 542 56.7 635 385 33.2 52.3 86.2
1995 1498 608 66.2 688 425 38.9 56.5 91.5
1996 1648 670 78.8 760 471 47.9 63.0 101.7
1997 1862 764 98.1 882 545 62.2 70.5 114.1
1998 2099 843 129.3 1062 616 91.1 85.8 147.9
1999 2435 969 184.1 1360 736 143.7 105.7 195.2
2000 2851 1111 268.9 1704 866 224.8 131.9 259.6
2001 3096 1194 311.3 1852 923 262 141.5 283.9
2002 3178 1211 319 1836 921 262.3 142.9 284.8
2003 3286 1264 330.1 1788 951 263.9 147.6 277.5
2004 3451 1332 349.9 1803 985 271.1 150.4 275.2
2005 3626 1402 376.3 1764 1009 278.2 157.7 275.7
2006 3815 1481 418.2 1716 1022 288.9 168.4 282.7
2007 4034 1567 448.4 1599 1016 264.3 165.3 260.1
2008 4221 1631 475.2 1370 886 206.3 150.6 232.8
2009 4327 1672 491 1231 823 179.7 146.0 218.3
2010 4456 1736 503.7 1278 853 184.7 144.5 216.5
2011 4621 1801 529.4 1335 881 199.3 149.3 226.2
2012 4785 1868 550 1334 883 200.2 150.1 226.7
2013 4957 1938 569.2 1331 874 192.9 144.9 220.7
The correct interpretation of this chart is that since the beginning of the industry to the end of 2013, 1,938 rms had been founded and
4,957 funds had been raised. Those funds totaled $569.2 billion. At the end of 2013, 874 rms as calculated using our eight-year methodol-
ogy managed 1,331 individual funds, with each fund typically being a separate limited partnership. Capital under management, again
calculated using a rolling eight years of fundraising, by those rms at the end of 2013 was $192.9 billion.
Figure 1.05
Number of Active Investors 1985 to 2013
Year # of Active
Investors
# of Active First
Round Investors
# of Active Life
Science Investors
1985 92 11 1
1986 115 24 12
1987 112 29 13
1988 119 32 26
1989 116 22 23
1990 101 25 18
1991 81 14 15
1992 104 34 31
1993 92 35 29
1994 110 46 33
1995 184 95 53
1996 251 122 63
1997 344 138 83
1998 411 169 87
1999 717 321 106
2000 1,050 546 148
2001 760 220 155
2002 534 137 147
2003 509 136 165
2004 579 202 201
2005 562 183 193
2006 572 192 197
2007 630 238 236
2008 602 212 219
2009 463 105 173
2010 508 136 177
2011 549 159 195
2012 534 139 175
2013 548 136 179
Firms included in each count must have invested $5 million in that year in that
category. Life Sciences investor count includes investment in companies in
the two MoneyTree Categories: Biotechnology/Pharma and Medical Devices/
Equipment.
Figure 1.06
Principals Information
Year No.
Principals
Per Firm
Estimated
Industry
Principals
Avg Mgt
Per Principal
($M)
2007 8.7 8665 30.0
2008 8.5 7293 28.3
2009 8.6 6760 26.4
2010 8.0 6328 25.7
2011 7.4 6231 28.6
2012 7.0 5887 33.8
2013 6.7 5891 32.8
Figure 1.07
Top 5 States By Capital Under
Management 2013
State ($ Millions)
CA 94,076.6
MA 32,636.6
NY 19,480.4
CT 5,815.1
IL 4,517.3
Total* 156,526.1
*Total includes above 5 states only
The correct interpretation of this chart is that since the beginning of the in-
dustry to the end of 2013, 1,938 rms had been founded and 4,957 funds had
been raised. Those funds totaled $569.2 billion. At the end of 2013, 874 rms
as calculated using our eight-year methodology managed 1,331 individual
funds, with each fund typically being a separate limited partnership. Capital
under management, again calculated using a rolling eight years of fundrais-
ing, by those rms at the end of 2013 was $192.9 billion.
Figure 1.08
Capital Under Management By State 1985-2013
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
CA 5,024 5,974 6,815 7,051 8,318 8,192 8,257 8,258 9,062 9,978 12,015 15,379 20,289 27,452 51,226
MA 2,252 2,580 3,409 3,775 4,179 4,057 3,761 4,636 4,830 5,179 6,553 6,980 9,859 15,397 22,905
NY 3,382 4,428 4,370 4,160 5,598 5,805 5,455 5,308 5,904 6,968 8,246 9,995 10,311 19,676 26,659
CT 1,297 1,444 1,807 1,876 1,714 1,713 1,570 1,665 1,927 2,088 2,064 2,194 3,323 4,492 6,787
IL 474 493 725 907 863 876 840 944 1,202 1,275 1,419 1,263 1,939 2,191 3,693
TX 458 493 727 726 798 840 777 809 935 1,143 1,145 1,233 1,688 3,001 4,797
PA 281 347 376 396 564 601 604 598 569 738 822 1,332 1,750 2,105 3,090
NJ 616 713 752 740 736 954 885 549 511 695 958 1,489 1,563 2,177 2,715
DC 36 38 38 40 41 42 42 40 25 24 146 1,698 2,382 2,504 2,661
WA 316 409 387 425 398 385 199 243 227 178 299 463 680 1,081 1,796
MD 91 95 121 117 159 164 98 115 374 784 914 1,523 2,012 2,649 3,513
CO 365 431 399 518 618 575 557 531 616 565 475 552 867 1,165 3,337
VA 73 79 79 85 105 92 56 42 35 32 48 73 252 508 1,238
NC 34 55 87 90 125 114 110 111 108 146 123 294 620 806 1,009
MN 200 297 340 677 749 886 815 768 841 896 877 514 618 715 1,093
UT 9 19 20 15 15 16 16 10 10 25 31 31 94 96 131
MI 112 120 126 123 124 38 14 14 13 10 41 41 66 77 439
GA 89 95 176 260 263 276 264 263 433 432 434 361 765 1,077 1,164
TN 103 128 192 185 216 260 278 271 199 291 306 455 465 745 1,059
DE 39 41 40 39 47 41 41 14 41 51 100 122 115 117 116
MO 562 586 619 596 603 658 656 645 107 137 119 125 148 111 217
OH 860 897 976 838 256 259 275 305 427 469 447 377 692 766 1,247
FL 125 131 173 193 196 133 110 98 151 223 321 304 380 690 1,072
IN 45 56 56 78 97 88 80 97 99 109 111 194 176 192 207
WI 183 100 99 96 104 104 79 79 81 163 168 196 180 204 174
AL 126 132 132 128 135 137 137 138 6 6 6 6 5 24 33
AZ 41 44 44 73 75 76 75 34 44 43 44 10 10 38 38
LA 7 7 7 7 7 5 2 11 22 31 49 90 277 367 444
KY 15 16 16 16 0 0 0 0 0 7 21 21 21 21 21
ME 1 1 20 25 26 26 26 28 29 98 89 87 88 89 207
ID 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
ND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
OK 1 29 29 28 37 38 37 37 38 9 10 32 23 67 66
OR 170 177 205 241 244 247 229 117 73 74 77 30 30 40 40
NM 71 100 136 133 170 257 244 232 205 179 154 152 121 12 12
SD 0 0 0 0 0 0 0 0 0 0 0 10 10 85 84
HI 2 2 2 2 2 2 2 0 0 0 2 2 2 2 11
KS 0 0 0 0 0 13 13 13 14 14 37 37 57 43 43
IA 50 52 105 102 81 82 62 62 54 55 5 5 16 17 16
VT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
NH 24 25 25 50 50 51 50 51 27 27 47 19 66 67 66
NE 0 0 0 1 1 1 1 1 11 11 105 137 139 141 140
MT 0 1 1 1 1 1 1 1 1 0 0 0 0 0 0
MS 0 0 0 0 0 0 0 0 0 0 11 11 11 12 11
PR 0 0 0 0 0 9 9 9 9 9 9 9 49 40 40
WY 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
SC 1 1 1 1 15 15 15 15 15 15 29 52 37 37 37
RI 15 16 16 36 37 37 36 36 22 22 23 0 2 2 2
NV 0 0 0 0 0 0 0 0 0 0 0 0 0 0 24
WV 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
AR 2 2 2 2 2 2 2 0 0 0 0 0 0 0 19
UNK 46 48 48 47 31 31 21 0 0 0 0 0 0 0 0
AK 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Total 17,600 20,700 23,700 24,900 27,800 28,200 26,800 27,200 29,300 33,200 38,900 47,900 62,200 91,100 143,700
Figure 1.08b
State 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
CA 85,153 105,283 105,172 107,896 113,719 119,881 128,655 117,244 100,374 87,469 90,424 96,923 99,386 94,077
MA 37,341 45,970 47,440 47,019 47,553 48,784 53,712 50,417 37,146 30,861 30,528 30,209 32,914 32,637
NY 38,938 39,981 38,421 37,176 36,710 36,242 29,115 25,441 13,205 12,198 13,599 18,628 17,653 19,480
CT 8,260 10,623 10,462 10,431 12,066 11,984 13,336 11,699 10,426 7,428 8,201 8,940 6,928 5,815
IL 4,308 4,747 5,202 5,559 5,685 5,163 5,286 4,239 3,620 3,282 3,065 4,595 4,451 4,517
TX 6,881 8,001 7,932 7,806 8,259 8,486 8,242 6,589 5,467 4,193 4,057 4,735 4,455 4,215
PA 6,241 6,344 6,241 6,532 6,439 6,509 7,037 7,143 4,642 4,482 4,495 4,250 4,220 3,623
NJ 3,633 4,315 4,231 4,444 4,083 4,074 5,160 5,022 4,135 3,917 3,965 3,691 3,503 3,447
DC 3,899 4,172 4,739 4,616 3,401 3,582 4,641 5,047 4,833 4,632 4,049 4,527 4,193 3,369
WA 2,803 3,687 3,691 3,568 4,629 4,590 4,597 5,174 4,625 3,721 3,691 3,708 2,943 3,303
MD 5,119 5,383 5,165 5,047 4,811 4,762 4,744 4,433 2,934 3,005 2,927 3,134 3,282 2,854
CO 4,781 5,293 5,438 5,416 5,229 4,882 4,664 3,011 1,603 974 1,139 1,148 1,187 1,635
VA 2,524 2,638 2,652 2,822 2,868 3,338 3,367 3,014 1,801 2,226 2,271 2,081 2,056 1,583
NC 1,367 1,448 1,599 1,803 1,644 1,468 1,678 1,564 1,211 1,238 1,730 1,631 1,726 1,558
MN 2,238 2,189 2,366 2,359 2,361 2,441 2,593 2,473 1,639 1,657 1,319 1,323 1,426 1,531
UT 268 475 449 560 589 546 651 1,259 1,335 1,144 1,209 1,245 1,422 1,429
MI 588 591 590 631 859 912 946 685 919 976 1,065 1,263 1,045 1,203
GA 2,311 2,160 2,154 2,077 2,109 1,835 1,940 1,931 808 783 787 921 882 1,122
TN 1,237 1,281 1,162 1,174 1,043 1,089 887 716 624 614 840 857 845 795
DE 114 80 69 28 15 15 15 251 256 404 504 653 755 756
MO 307 450 418 407 504 1,232 1,293 1,385 1,317 1,182 1,189 1,192 1,324 561
OH 1,850 1,874 1,876 1,855 1,986 1,806 1,722 1,329 713 565 522 573 456 529
FL 1,785 1,751 1,684 1,592 1,577 1,802 1,525 1,284 557 801 875 832 834 529
Figure 1.08b (Continued)
State 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
IN 663 662 651 684 593 595 608 617 136 342 343 309 344 345
WI 246 245 152 152 133 105 207 254 182 185 212 237 309 339
AL 107 107 107 155 173 225 227 219 359 363 366 391 376 317
AZ 101 104 145 180 180 199 171 173 130 118 263 261 311 295
LA 476 651 648 631 663 502 431 353 336 196 265 282 217 249
KY 21 21 14 14 14 21 219 221 226 228 230 216 223 216
ME 202 290 218 219 214 215 310 194 198 108 109 109 110 110
ID 14 14 14 14 14 14 84 86 73 74 74 74 75 75
ND 0 0 0 0 0 0 0 0 13 13 14 14 14 58
OK 140 140 139 139 117 117 111 121 47 47 48 48 48 50
OR 100 100 112 83 85 85 76 78 34 40 29 29 38 46
NM 12 12 12 33 35 69 74 77 79 80 114 84 83 42
SD 178 178 177 177 175 175 103 113 32 32 48 48 40 40
HI 11 11 11 9 16 16 16 7 14 14 43 44 36 36
KS 42 42 42 19 19 0 0 0 0 0 0 14 14 34
IA 16 60 60 55 65 53 60 67 69 39 39 39 29 29
VT 16 43 43 43 43 43 43 57 41 14 19 19 19 29
NH 65 65 65 46 47 0 11 11 11 11 11 11 16 16
NE 175 165 164 71 38 38 38 38 0 0 2 2 3 3
MT 0 0 0 0 0 0 2 2 2 2 2 2 2 2
MS 11 39 39 28 28 28 29 30 30 1 1 1 1 1
PR 39 68 68 68 68 29 29 30 31 1 1 1 1 1
WY 118 117 117 117 117 118 118 119 0 0 0 0 0 0
SC 36 37 51 38 15 20 20 20 21 20 5 6 6 0
RI 2 26 26 35 35 33 33 33 34 10 10 0 0 0
NV 23 23 33 33 33 33 33 9 10 10 0 0 0 0
WV 21 21 21 21 21 21 21 21 0 0 0 0 0 0
AR 19 19 19 19 19 19 19 0 0 0 0 0 0 0
UNK 0 0 0 0 0 0 0 0 0 0 0 0 0 0
AK 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Total 224,800 262,000 262,300 263,900 271,100 278,200 288,900 264,300 206,300 179,700 184,700 199,300 200,200 192,900
Figure 1.09
Life of IT Funds in Years
Life of IT Funds In Years % of Funds
<= 10 7%
11-12 20%
13-14 27%
15-16 22%
17-18 14%
>=19 10%
This chart tracks the year in which a 10-year fund is, in
fact, dissolved. These later periods are referred to as
out years. Historically, after the 10th year, only a few
companies that typically do not have huge upside potential
remain in the portfolios. But the slow pace of exits in recent
years has resulted in a number of good, mature companies
remaining in portfolios well past the nominal 10-year mark.
Life science funds tend to have lives two years longer than
typical technology funds. In preparing this chart, partial
years are rounded to the nearest whole year. So 10.4 years
would round to 10 years, and 10.5 years would round up to
11 years. The median life span of a fund in this analysis is
14.17 years.
Source: Adams Street Partners, based on
2010 analysis of dissolved funds.
CAPITAL COMMITMENTS
Methodology
The Thomson Reuters/National Venture Capital Association sample in-
cludes US-based venture capital funds. Classifcations are based on the
headquarters location of the fund, not the location of the venture capital
frm. The sample excludes fund of funds.
Effective November 1, 2010, Thomson Reuters venture capital fund
data has been updated in order to provide more consistent and relevant
categories for searching and reporting. As a result of these changes, there
may be shifts in fundraising statistics from legacy editions of this publica-
tion due to reclassifcation of funds based on analysis of actual activity by
primary market, nation, and/or fund stages.
As defned by Thomson Reuters, capital commitments, also known as
fundraising, are frm capital commitments to private equity/venture capi-
tal limited partnerships by outside investors. For purposes of these statis-
tics, the terms capital commitments, fundraising, and fund closes
are used interchangeably. There are three data sources for tracking capital
commitments: (1) SEC flings that are regularly monitored by our research
staff, (2) surveys of the industry routinely conducted by Thomson Re-
uters, and (3) verifed industry press and press releases from venture frms.
Capital commitments are stated on either (1) a calendar-year basis when
committed (for example, throughout this chapter) or (2) a vintage-year
basis, which is designated once the fund starts investing (for example,
fgure 1.04). The data in this chapter is by calendar year and incrementally
measures how much in new commitments funds raised during the calen-
dar year. Consider, for example, a venture capital frm that announces it
will begin raising a $200-million fund in late 2011, raises $75 million in
2012, and subsequently raises the remaining $125 million in 2013. In this
chapter, nothing would be refected in 2011, $75 million would be counted
in 2012, and $125 million would be counted in 2013. Assuming it started
investing and made its frst capital call in 2013, the entire fund would then
be considered to be a vintage year 2013 fund. In Figure 1.04, for example,
this hypothetical fund would show in the totals for 2013.
Note that fund commitments presented in this publication do not in-
clude those corporate captive venture capital funds that are funded by a
corporate parent, which do not typically raise capital from outside inves-
tors.
The year 2013 continued to be a very challenging fundraising year for most venture capital frms in the United States. This is due to a lack of recent
distributions caused by the tight exit markets, lackluster returns by many venture funds over the past decade compared with the prior decade, and a
challenge for the largest alternative asset investors to place money in many of the smaller funds in this asset class because of scale. Only $16.8 billion
was raised by 187 funds. This is considerably less than the $19.6 billion raised in 2012 or the $19.0 billion raised in 2011. The amount of new commit-
ments each year by venture capital funds continues to be less than the amount they invested in companies.
The top fundraising state in 2013 was Massachusetts at $5.5 billion, which edged typical leader California at $5.3 billion. New York was third largest
at about half that amount. Much further behind, Washington state and Virginia rounded out the top fve. Combined, Massachusetts and California funds
raised 64% of the total. Adding in New York, the top three states raised more than three-quarters (77%) of the total amount.
The Thomson Reuters taxonomy considers venture capital and buyout/mezzanine to be the two components of Private Equity. Figures 2.02 and 2.05
show venture capitals decreasing share of the private equity dollars. Venture capital raised 24% of the asset class allocations in 2009 compared with
11% in 2013.
0
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(
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Year
Figure 2.01
Capital Commitments To U.S. Venture Funds ($ Billions)
1985 to 2013
Figure 2.02
Capital Commitments To Private Equity Funds 1985-2013
Year Sum ($Mil) % of Total PE No. Funds Sum ($Mil) No. Funds Sum ($Mil) No. Funds
1985 3,759.9 56% 118 2,971.8 21 6,731.7 139
1986 3,584.5 42% 101 5,043.7 32 8,628.2 133
1987 4,379.1 21% 116 16,234.6 47 20,613.6 163
1988 4,209.7 28% 104 10,946.4 54 15,156.1 158
1989 4,918.8 29% 106 12,068.5 78 16,987.3 184
1990 3,077.5 26% 85 8,831.5 64 11,909.0 149
1991 1,900.3 31% 40 4,242.1 27 6,142.4 67
1992 5,223.1 33% 80 10,752.5 58 15,975.6 138
1993 4,489.2 21% 93 16,961.7 81 21,451.0 174
1994 7,636.7 27% 136 20,157.0 99 27,793.7 235
1995 9,387.3 26% 161 27,040.7 108 36,428.0 269
1996 11,550.0 26% 168 32,789.4 104 44,339.3 272
1997 17,741.9 30% 242 42,165.3 134 59,907.2 376
1998 30,641.7 33% 290 61,636.4 172 92,278.1 462
1999 53,420.2 51% 428 51,363.2 164 104,783.4 592
2000 101,417.9 56% 634 79,164.8 170 180,582.7 804
2001 38,923.4 43% 324 51,388.3 137 90,311.7 461
2002 10,388.1 23% 203 35,123.3 124 45,511.4 327
2003 9,144.7 20% 160 35,946.4 123 45,091.1 283
2004 17,656.3 23% 211 59,837.4 158 77,493.7 369
2005 30,071.9 22% 233 107,746.6 206 137,818.6 439
2006 31,107.6 17% 236 152,899.7 219 184,007.3 455
2007 29,401.0 11% 235 234,460.4 266 263,861.4 501
2008 25,052.7 12% 214 176,340.7 232 201,393.5 446
2009 16,122.0 24% 159 50,145.9 149 66,267.9 308
2010 13,243.3 20% 173 51,901.5 177 65,144.8 350
2011 18,962.3 21% 186 70,344.2 210 89,306.5 396
2012 19,554.6 15% 208 108,076.4 226 127,631.0 434
2013 16,765.7 11% 187 130,256.2 214 147,021.9 401
Venture Capital Buyouts and Mezzanine Capital Total Private Equity
Figure 2.03
Venture Capital Fund Commitments 1985-2013 ($ Millions)
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
MA 201.88 1,460.41 546.89 279.00 2,260.07 489.77 473.90 493.63 940.19 1,860.48 2,364.08 1,516.09 3,757.76 9,346.10 9,065.81 15,399.96 3,092.69 7,754.42 1,233.34 2,148.71
CA 1,249.69 972.35 1,268.36 966.91 1,523.51 1,010.69 549.12 1,331.19 1,388.50 1,829.06 3,106.99 3,724.04 5,717.43 8,525.24 21,928.12 44,218.83 14,166.13 2,767.31 5,634.15 8,731.29
NY 534.28 356.09 973.09 813.49 338.52 529.47 180.08 1,051.12 367.79 1,158.41 1,954.71 1,875.06 2,601.56 5,200.95 7,586.57 16,691.77 9,721.17 2,598.46 1,596.98 1,797.30
WA 37.41 33.48 231.25 40.69 161.45 142.81 55.43 381.89 137.00 282.50 193.64 326.00 393.97 1,406.64 1,802.52 3,687.77 2,232.20 185.50 75.63 893.91
VA 299.07 155.86 310.63 357.37 61.50 129.50 150.00 300.30 419.25 388.28 260.20 424.93 1,165.98 1,067.56 2,842.58 1,813.40 3,464.30 46.73 165.00 1,756.45
TN 253.67 61.34 119.67 0.35 125.00 243.46 75.00 110.00 176.58 401.30 213.13 605.75 117.61 1,001.84 569.79 1,040.86 651.68 392.11 560.62 196.70
CO 4.20 7.47 24.18 0.00 49.25 13.61 50.00 0.00 224.90 479.20 66.50 439.00 145.00 768.15 839.70 1,989.92 340.45 380.50 105.00 161.52
TX 89.43 47.02 324.62 157.79 26.20 57.20 94.40 247.17 277.82 182.81 229.68 295.21 575.13 466.35 1,298.59 964.19 1,103.18 477.86 701.08 432.30
PA 31.50 70.55 32.23 69.90 79.71 0.40 0.00 0.00 114.22 0.00 19.35 216.40 252.88 432.62 1,942.08 2,414.30 512.63 117.96 93.92 83.89
OH 25.00 126.13 37.40 59.51 0.00 0.00 5.00 48.00 39.90 36.87 128.50 239.32 179.99 408.79 640.30 1,174.61 888.01 83.03 1.20 955.27
MI 38.74 0.00 0.00 4.80 0.00 0.00 0.00 0.00 0.00 0.00 130.00 820.00 667.60 391.50 359.60 778.29 622.18 314.80 0.00 324.48
MN 20.00 23.45 72.50 0.00 34.07 0.00 0.00 40.00 0.00 115.90 83.77 149.00 109.07 266.36 254.81 261.55 36.93 22.40 93.25 0.00
IL 0.00 3.50 10.00 12.80 15.00 2.00 0.00 17.00 5.00 0.00 7.00 20.00 165.40 255.99 884.03 2,211.92 119.15 37.48 196.27 71.95
NC 9.70 0.00 36.00 10.70 29.30 0.00 35.00 0.00 133.28 105.00 106.00 0.00 77.70 250.00 325.88 954.75 25.75 7.95 56.00 1.00
UT 13.60 109.75 51.20 417.50 20.00 161.80 16.20 946.30 65.85 164.05 46.80 35.50 207.97 216.70 106.57 1,826.52 16.50 275.50 26.00 49.80
GA 0.00 0.00 15.10 65.00 0.00 14.00 0.00 0.00 56.00 0.00 74.19 34.30 40.85 181.00 30.00 917.90 19.00 0.00 0.00 55.00
MO 54.05 73.06 54.65 12.10 117.98 44.52 166.60 30.10 109.70 181.65 113.60 264.00 783.90 177.00 1,240.76 2,751.47 536.61 85.66 387.97 450.73
WI 6.50 7.00 31.48 22.80 38.12 0.60 0.00 0.00 0.00 63.45 10.10 183.50 349.00 173.68 180.41 613.41 119.64 74.90 275.86 17.31
ND 2.56 0.00 86.98 75.00 0.00 30.38 0.00 67.00 4.43 85.97 10.00 0.00 364.95 58.00 658.58 662.03 329.95 101.70 4.88 209.72
DC 0.00 0.00 0.00 0.00 0.00 0.00 0.00 10.60 14.20 169.00 18.26 23.95 87.95 51.00 373.35 69.50 26.50 52.00 0.00 72.98
LA 0.00 10.50 0.80 0.00 0.00 0.00 0.00 0.00 0.00 27.00 0.00 0.00 17.00 50.00 61.50 126.00 231.65 0.00 34.30 40.30
KS 0.00 31.82 0.00 0.00 10.30 0.00 0.00 0.00 0.00 0.00 0.00 24.29 0.00 45.30 0.00 110.10 0.00 0.00 0.00 0.00
MS 150.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5.00 30.00 0.00 137.00 16.35 11.00 49.00 18.70
OR 643.50 0.00 33.26 0.00 0.00 53.13 0.00 0.00 63.60 0.00 11.30 6.00 45.40 25.03 79.63 64.77 286.20 0.00 0.00 80.30
VT 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 11.00 0.00 22.00 14.00 131.00 1.00 0.00 0.00 5.00
IN 0.00 10.00 0.00 27.30 16.30 4.70 0.00 49.00 0.00 20.00 0.00 116.11 0.00 12.80 20.00 103.30 0.00 10.00 35.56 17.00
FL 0.00 0.00 30.00 0.00 0.00 0.00 0.00 0.00 0.00 32.00 32.00 0.00 0.00 10.00 0.00 65.00 0.00 14.00 0.00 2.20
CT 10.73 0.00 60.05 0.00 0.00 0.00 0.00 56.00 0.00 0.00 5.00 0.00 10.50 1.78 5.00 21.00 26.00 0.00 0.00 10.00
NJ 5.00 0.00 6.70 32.50 0.00 0.00 0.00 0.00 3.00 13.50 0.00 26.00 11.30 0.30 320.80 241.00 8.00 0.00 64.84 63.33
MD 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 20.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
OK 16.60 0.00 0.00 24.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 25.00 0.00 0.00 0.00
AL 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2.60 0.00 0.00 0.00 9.50 0.00 0.00 2.53 0.00 7.86
SD 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
IA 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 12.00 0.00 0.00 0.00 0.00 30.00 0.00 0.00 0.00 0.00
RI 49.42 0.00 0.00 40.00 0.00 0.00 15.00 0.00 0.00 0.00 20.00 0.00 50.00 0.00 0.00 0.00 0.00 11.20 8.80 0.00
HI 0.00 0.00 22.04 947.60 0.00 0.00 0.00 2.00 0.00 58.80 0.00 21.65 0.00 0.00 126.89 0.00 76.45 15.60 2.95 0.00
MT 0.00 0.00 0.00 37.00 0.00 0.00 0.00 0.00 10.10 0.00 0.00 0.00 0.00 0.00 29.40 60.00 20.70 42.61 40.80 0.00
NH 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5.50 4.00 12.75 2.00 0.00
ME 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 19.65 25.00 0.00 0.00 0.00
AZ 0.00 0.00 0.00 0.00 12.50 4.50 0.00 0.00 0.00 0.00 14.00 0.00 0.00 0.00 0.00 0.00 0.00 15.00 0.00 0.00
WV 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 15.00 27.00 0.00 0.00 0.00
SC 0.00 0.00 0.00 0.00 0.00 10.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 31.20 0.00 0.00 0.00
ID 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 50.00 25.00 0.00 0.00 25.00 0.00 0.00 10.00 0.00 0.00
PR 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
NV 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 111.01 36.00 0.00 0.00 0.00 40.60 0.00 0.00 0.00 0.00
NE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 25.00 31.00 64.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 10.00
DE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 62.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
UN 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 26.00 0.00 0.00 0.00 0.00
WY 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 20.00 0.00 0.00 0.00 0.00
AR 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 40.00 0.00 31.00 30.15 0.00 16.60 82.00 14.00 0.00 0.00 10.68
NM 36.15 27.70 0.00 2.06 0.00 155.00 40.00 0.00 0.00 6.10 1.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00 17.76 20.35
KY 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 14.00 7.40 15.00 0.00 42.00 0.00 0.00 0.00 135.00 8.00 2.14 0.00
Total 3,782.66 3,587.47 4,379.07 4,476.68 4,918.80 3,097.52 1,905.73 5,243.80 4,565.30 7,733.72 9,442.31 11,553.58 17,993.04 30,842.67 53,638.36 101,740.87 38,952.18 15,928.95 11,465.28 18,696.01
Venture Capital Fund Commitments 1985-2013 ($ Millions)
State 2005 2006 2007 2008 2009 2010 2011 2012 2013
MA 1,735.74 2,252.82 4,409.92 1,949.58 1,652.22 1,259.41 4,096.04 659.75 5,474.78
CA 13,319.31 13,635.99 12,533.51 13,972.15 8,635.34 6,337.42 9,678.38 14,708.16 5,315.87
NY 9,150.90 4,365.57 5,121.96 2,516.05 3,573.19 2,664.92 2,339.74 1,414.73 2,200.41
WA 629.84 379.48 263.77 1,037.91 26.79 82.72 209.64 51.34 561.77
VA 143.06 2,910.97 286.64 227.29 157.73 938.22 11.00 23.15 446.06
TN 204.27 1,812.38 235.17 52.79 503.67 112.40 100.27 64.78 310.39
CO 432.75 472.23 782.73 368.88 484.14 67.60 543.52 28.93 275.10
TX 80.46 421.96 544.90 258.01 215.60 237.65 215.05 131.67 274.35
PA 68.76 132.45 358.26 220.75 3.50 262.09 6.13 280.36 259.59
OH 280.57 562.85 1,376.20 492.38 5.28 0.00 0.00 398.81 240.19
MI 392.62 896.30 314.60 1,122.94 204.06 0.00 475.00 0.40 236.24
MN 83.75 61.83 99.50 133.96 88.79 56.95 160.93 277.79 222.01
IL 418.62 555.42 582.42 105.28 14.42 121.37 35.63 44.70 187.62
NC 313.00 11.20 109.26 25.20 32.25 74.55 1.57 268.00 154.98
UT 295.00 473.24 275.00 325.10 21.80 0.00 0.00 150.00 136.85
GA 103.50 361.70 203.00 18.73 18.75 30.00 25.55 17.15 126.45
MO 688.16 794.40 825.81 962.73 233.18 205.17 126.81 281.89 101.38
WI 108.01 401.37 185.28 102.93 5.37 457.40 109.58 479.98 67.50
ND 558.16 152.22 81.45 83.38 1.88 30.27 82.40 29.44 45.27
DC 4.00 12.00 0.00 0.00 0.00 0.00 0.00 0.00 44.80
LA 23.98 169.59 213.15 576.50 34.26 16.45 160.42 159.33 40.00
KS 12.00 37.96 10.50 0.00 0.00 0.00 0.00 0.14 25.86
MS 69.65 19.10 0.00 117.93 101.35 1.53 58.10 19.90 14.23
OR 828.70 39.65 210.30 53.94 0.00 72.00 0.00 155.00 12.02
VT 0.00 3.28 0.00 14.48 0.00 16.00 0.00 0.00 10.00
IN 6.00 24.49 1.16 28.80 1.00 28.05 0.00 38.95 8.00
FL 0.00 0.00 2.03 5.00 5.90 12.25 2.03 6.98 2.00
CT 0.00 42.91 0.00 0.00 15.35 0.00 0.00 0.00 0.00
NJ 122.44 23.00 49.00 255.56 84.00 176.51 193.98 20.11 0.00
MD 0.00 0.25 10.04 19.97 0.00 0.00 7.85 0.00 0.00
OK 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
AL 0.00 0.00 0.00 6.39 0.00 0.00 0.00 0.00 0.00
SD 0.00 1.75 0.00 0.00 0.00 0.00 0.00 0.00 0.00
IA 0.00 1.35 0.00 0.00 0.00 0.00 0.00 0.00 0.00
RI 0.00 5.00 6.66 0.00 0.00 0.00 0.00 4.50 0.00
HI 0.00 45.55 19.45 0.00 0.00 0.00 5.50 4.64 0.00
MT 19.00 0.00 0.00 20.00 0.00 0.00 222.18 57.16 0.00
NH 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
ME 0.00 0.00 11.00 3.00 0.00 0.00 0.00 0.00 0.00
AZ 5.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
WV 0.00 0.00 75.75 0.00 0.00 0.00 0.00 0.00 0.00
SC 0.00 0.00 1.00 0.00 0.00 0.00 0.00 0.00 0.00
ID 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
PR 0.00 0.00 0.00 13.20 0.00 0.48 0.00 0.18 0.00
NV 0.00 0.00 0.00 0.00 0.00 2.00 0.00 1.00 0.00
NE 0.00 0.00 0.00 0.00 0.00 100.00 100.00 0.00 0.00
DE 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
UN 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
WY 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
AR 0.00 80.68 102.33 15.09 9.20 27.32 0.15 40.00 0.00
NM 25.65 5.20 1.27 0.00 0.00 35.00 1.14 0.00 0.00
KY 7.95 65.00 98.00 12.00 0.00 0.00 0.00 7.00 0.00
Total 30,131.45 31,231.10 29,400.99 25,117.84 16,128.99 13,425.72 18,968.57 19,825.91 16,793.70
Figure 2.04
Top 5 States
By Venture Capital Committed 2013
State No of
Funds
Committed
($Mil)
Massachusetts 24 5,474.8
California 58 5,315.9
New York 25 2,200.5
Washington 5 561.8
Virginia 5 446.1
Subtotal 117 13,999.1
Remaining States 70 2,766.8
Total 187 16,765.9
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Year
Venture Capital Buyouts and Mezzanine
Figure 2.5
Private Equity Annual Commitment ($ Billions)
1985 to 2013
Measuring industry activity by the total dollars invested in a given year shows that the industry has remained generally in the $20 billion to $30 billion
range since 2002. In 2013, $29.5 billion was invested in 3,382 companies through 4,041 deals. The number of deals is 4% higher than 2012 counts,
but is essentially the same as 2011. The number of frst-time fundings increased in 2013 to 1,334 companies from the previous 1,275, but it remains
near the top of the healthy range of 1,000 to 1,400 frst-time fundings in a year. Further parsing the data shows 50% of the investment dollars going to
California companies, down from 53% in 2012 but consistent with the previous three years. The year 2013 saw a record 56% of the fnancing rounds
going to seed and early stage companies, compared with a more typical one-third of deals. A carefully watched statistic is the investment in the life sci-
ences. It is possible that the downward plummet in frst-time life sciences investment is starting to reverse, led by Biotechnology, but it is still too early
to be sure. Corporate Venture investment continues to gain considerable strength and presence in the overall industry.
INVESTMENTS
Sectors
Software was the leading sector in 2013, receiving 37.3% of the total
dollars. The second largest sector was Biotechnology, which was less than
half that amount at 15.4% of total investment. Media and Entertainment,
where much of the social networking is categorized, received 9.9% and
Medical Devices and Equipment received 7.2%.
The life sciences share of the venture capital investment dollars de-
creased in 2013 to its lowest level since 2001 at 23.6% of the total dollars.
(For purposes of this paragraph, life sciences is made up of all three life
science categories. Some industry observers choose to exclude the health-
care services sector from the life sciences totals.) This is down from the
recent peak of 32.7% in 2009. (The all-time peak was 36.3% in 1992.)
This recent downward life sciences trend is very visible when just
looking at frst fundings. In 2013, only 155 life sciences (defned in this
paragraph as Biotech/pharma and Medical Devices/therapeutics, but not
healthcare services) received frst fundings, up just slightly form 148 in
2012. While the uptick driven by Biotechnology frst fundings may be an
early indicator of a rebound, these last two years are the lowest counts
since 1996. The possible recovery in Biotechnology investing may have
been driven in part by the success of recent efforts at FDA reform and the
strong number of Biotechnology company IPOs in 2013 (count = 42).
Among frst fundings, Software led the way with 591 companies get-
ting their initial venture capital rounds. This is more than 46% of the frst
fundings. Again in 2013, the second most active frst-funding sector is
Media and Entertainment at 170 frst fundings.
Stages and First-Time Fundings
Investment activity in the industry seems to be bifurcated by the large
number of later stage companies hoping to join fairly strong public mar-
kets at year end 2013 and the very large number of new companies being
funded by the industry. While many of the larger portfolio companies,
IPOs, and big acquisitions have gotten the headlines and visibility, 2013
actually saw the highest percentage of seed- and early-stage deals ever at
55.7% of all deals. This surpasses the prior record of 52.6% in 2012. This
certainly would challenge the suggestion that the industrys attention is
single-focused on later-stage companies. Despite the furry of IPO activity
in 2013 and acquisitions announced for early 2014, there remains a record
number of companies in portfolios in the later stage of development that
in most other positions in the business cycle would have already gone
public or otherwise been acquired.
With the rule of thumb that a healthy venture capital industry invests in
1,000-1,300 new companies each year, the 1,334 frst fundings in 2013 is
very much in that range. Not surprisingly, 83% of those frst round invest-
ments were made at the seed and early stage.
Geographical Spread Across the United States
The year 2013 provided an interesting contrast in geographic disper-
sion. The slight majority of investment dollars went to California compa-
nies at 50.01%. This is down from the record 53.2% in 2012. Interestingly,
companies in 48 states and DC received fnancing, which ties the 2012
record high. Ranked by total dollars invested, the top fve states (Califor-
nia, Massachusetts, New York, Washington and Texas) received 78% of
all the dollars invested nationally.
This compares to 2011, when California companies received a then-
record 51.2% of the dollars. That year, companies in a record 47 states and
DC received venture capital funding. Together, the top fve states (Cali-
fornia, Massachusetts, New York, Texas, and Washington State) received
77% of the total dollars.
California-domiciled venture capital frms made investments in 38
states in 2013. Approximately 48% of all the money invested in Califor-
nia came from California-domiciled frms. Conversely, California-based
frms concentrated 68% of their investment dollars within the state.
Corporate Venture Group Involvement
The number and reach of corporate venture capital groups increased
in 2013, along with the visibility of this group. These groups provided
an estimated 10.5% of the venture capital invested by all venture groups.
They were involved in 16.9% of the deals the highest level in fve years.
Going forward, all signs suggest that these groups are becoming more
involved alongside traditional venture frms in deals, as well as initiating
corporate venture group syndicates to do deals in lieu of, or in advance of,
investment rounds by traditional venture frms.
Methodology
As calculated by Thomson Reuters, venture capital investment data are
derived from several sources. Primarily, survey information is obtained
from the quarterly survey that drives the MoneyTree Report from Price-
waterhouseCoopers and the National Venture Capital Association based
on data from Thomson Reuters. This is the offcial industry database of
venture capital investment. Secondly, Thomson Reuters obtains data from
SEC flings that are regularly monitored by our research staff. Finally,
publicly available sources such as press releases and trade publications
are used.
For detailed information on which transactions qualify as MoneyTree
deals and are therefore counted in this chapter, please refer to Appendix B.
0
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Figure 3.01
Venture Capital Investments ($ Billions)
1985 to 2013
Figure 3.03
Venture Capital Investments
Top 5 States in 2013
State # Companies # Deals Invested
($Bil)
California 1,362 1,616 14.8
Massachusetts 307 364 3.1
New York 344 403 2.9
Texas 134 154 1.3
Washington 107 126 0.9
Total* 2,254 2,663 23.0
*Total includes top 5 states only
Figure 3.02
Venture Capital Investments in 2013 By Industry Group
Industry Group # Companies # Deals Investment
Amt ($Bil)
# Companies # Deals Investment
Amt ($Bil)
Information Technology 2,360 2,784 20 1,009 1,009 3.5
Medical/Health/Life Science 649 816 6.9 167 167 1.2
Non-High Technology 373 441 2.7 158 158 0.4
Total 3,382 4,041 29.6 1,334 1,334 5.1
Initial Investments All Investments
Biotechnology
15%
Services 0.4%
Computers and Peripherals 2%
Services 4%
1%
Financial Services
2%
Healthcare Services
1%
Industrial/Energy
5%
IT Services
7%
10%
Medical Devices and
Equipment
7%
2%
1%
Semiconductors
2%
Software
37%
Telecommunications
2%
Other
0.2%
Figure 3.04
By Industry Sector (Dollars Invested)
Seed
3%
Early Stage
34%
Expansion
33%
Later Stage
30%
Figure 3.05
By Stage (Dollars Invested)
USA
AK
AR
NE
WY
PR
VI
GU
5
AL
113
AZ
CA
429
CO
182
CT
286
DC 71
DE
421
FL
412
GA
2
HI
23
IA
7
ID
IL
25
IN 33
KS
11
KY
15
LA
3,079
MA
664
MD
27
ME
108
MI
270
MN
77
MO
1
MS
MT
260
NC
24
ND
74
NH
322
NJ
26
NM
7
NV
2,870
NY
319
OH
8
OK
138
OR
447
PA
82
RI
86
SC
12
SD
109
TN
1,316
TX
315
UT
594
VA
21
VT
913
WA
36
WI
1
WV
14,770
10
86
435
0
Figure 3.06
Amount of Capital Invested By State in 2013 ($ Millions)
USA
AK
AR
NE
WY
PR
VI
GU
4
AL
19
AZ
CA
62
CO
43
CT
27
DC 5
DE
37
FL
35
GA
2
HI
2
IA
2
ID
74
IL
11
IN 6
KS
6
KY
6
LA
307
MA
63
MD
4
ME
58
MI
32
MN
32
MO
2
MS
1
MT
40
NC
1
ND
13
NH
38
NJ
13
NM
3
NV
344
NY
68
OH
8
OK
30
OR
196
PA
11
RI
12
SC
1
SD
35
TN
134
TX
30
UT
58
VA
8
VT
107
WA
18
WI
1
WV
1,362
9
3
Figure 3.07
Number of Companies Invested in By State in 2013
Figure 3.08
Venture Capital Investments in 1985-2013 By Region ($ Millions)
Region 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Silicon Valley 758.8 1,016.0 849.9 985.9 918.1 914.1 780.5 1,121.1 903.7 1,073.8 1,807.8 3,417.7 4,632.3 5,881.4 17,797.4
New England 435.4 436.6 524.3 496.9 404.7 424.9 287.0 417.0 358.4 440.4 796.6 1,159.4 1,611.8 2,353.4 5,622.0
NY Metro 221.2 215.2 273.9 308.0 360.4 190.1 181.5 239.0 221.3 275.8 509.7 743.2 1,289.4 1,817.3 4,611.8
LA/Orange County 196.5 186.9 276.9 222.5 242.1 174.7 119.4 179.4 176.4 189.1 1,004.1 702.9 875.2 1,230.6 3,593.7
DC/Metroplex 99.1 61.5 111.8 129.9 139.5 96.9 51.3 65.8 384.1 137.8 420.2 586.3 515.1 1,148.5 2,395.1
Texas 248.6 228.4 211.0 240.7 229.2 141.0 161.4 150.5 241.9 313.8 479.2 553.4 908.7 1,205.6 3,163.1
Southeast 166.4 237.6 269.5 272.1 235.4 145.9 109.1 346.9 408.2 362.3 878.6 1,166.0 1,396.7 1,794.8 4,831.0
Midwest 160.5 139.9 198.4 132.3 183.2 166.7 181.4 165.2 276.9 432.6 470.4 736.2 913.5 1,644.5 2,631.1
Northwest 142.2 142.9 153.3 141.2 118.0 88.2 59.9 252.1 118.4 164.7 379.7 557.6 564.4 820.3 2,874.6
San Diego 99.6 95.4 107.8 149.8 145.5 113.3 115.7 128.2 133.0 221.0 276.8 485.2 516.0 669.4 1,437.0
SouthWest 40.1 82.5 57.5 59.7 50.7 30.3 49.0 98.4 49.7 38.0 113.1 184.6 303.1 411.2 843.1
Colorado 77.0 113.8 111.4 107.8 157.8 93.7 54.2 129.7 135.0 197.4 325.1 321.2 405.0 838.9 1,832.9
Philadelphia Metro 52.6 63.3 79.2 71.8 65.3 105.9 40.6 168.9 111.4 138.1 220.9 356.2 534.2 703.9 1,732.6
North Central 37.0 44.5 73.6 41.4 51.2 92.2 44.9 77.1 109.6 87.4 223.8 208.5 341.6 429.6 770.0
South Central 13.7 11.4 19.8 11.7 14.5 11.6 4.2 6.5 8.6 15.2 45.2 81.1 67.4 196.7 360.1
Upstate NY 14.2 10.7 10.2 5.3 7.3 11.1 3.4 9.1 5.7 0.7 35.5 22.7 90.3 195.4 212.4
Sacramento/N.Cal 16.0 45.5 32.0 33.6 4.2 19.5 15.7 8.5 19.1 20.0 20.0 28.6 21.4 86.8 119.1
Unknown - - 0.5 0.8 6.1 13.0 0.2 30.8 0.8 0.1 0.3 2.2 4.4 39.1 2.4
AK/HI/PR - - - - - - 0.3 0.0 1.0 22.0 7.8 28.7 14.0 5.5 17.4
Total 2,779.0 3,132.3 3,361.3 3,411.3 3,333.0 2,833.1 2,259.7 3,594.2 3,663.2 4,130.1 8,014.8 11,341.6 5,004.6 21,473.0 54,846.7
Venture Capital Investments in 1985-2013 By Region ($ Millions)
Region 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Silicon Valley 33,430.9 12,618.7 7,249.2 6,766.5 8,021.2 8,133.6 9,806.9 11,610.0 11,551.3 8,263.4 9,436.2 12,037.2 11,237.6 12,225.7
New England 12,000.6 5,397.2 2,999.3 2,990.4 3,359.7 2,969.9 3,319.2 4,004.1 3,754.8 2,603.7 2,577.9 3,344.5 3,391.6 3,307.7
NY Metro 10,275.4 3,497.1 1,548.7 1,385.0 1,635.7 1,972.7 2,172.1 1,936.2 2,169.7 1,748.9 1,872.8 2,862.5 2,366.9 3,194.7
LA/Orange County 6,782.0 2,264.7 1,286.8 1,069.4 1,319.8 1,506.1 1,898.7 1,925.3 2,041.4 1,080.9 1,687.8 2,076.7 2,092.5 1,748.2
DC/Metroplex 5,795.2 2,103.1 1,095.6 797.4 1,086.6 1,208.3 1,356.3 1,423.7 1,167.9 684.3 973.9 1,014.0 756.8 1,545.9
Texas 6,270.8 3,137.3 1,191.6 1,221.0 1,212.3 1,170.7 1,518.2 1,493.8 1,127.7 678.2 1,079.4 1,622.4 948.9 1,315.5
Southeast 7,967.1 2,684.7 1,768.7 1,115.0 1,418.1 1,094.2 1,206.3 1,841.0 1,352.0 1,032.0 1,101.2 1,193.4 801.1 1,293.9
Midwest 5,776.7 2,184.5 976.9 913.6 712.5 916.5 1,009.7 1,159.2 1,369.5 952.3 1,368.2 1,554.1 1,436.8 1,107.3
Northwest 3,627.9 1,426.8 766.7 643.5 1,001.2 1,003.9 1,288.0 1,612.5 1,075.6 673.9 728.9 785.4 998.5 1,056.7
San Diego 2,297.6 1,579.1 997.4 825.8 1,197.8 1,203.9 1,231.0 1,846.4 1,209.4 939.5 881.2 928.0 1,191.6 767.7
SouthWest 1,387.5 515.1 393.8 220.5 393.6 524.8 526.6 589.0 545.7 291.2 275.9 571.5 600.4 455.4
Colorado 4,091.9 1,244.4 588.0 609.9 363.2 622.9 703.3 686.3 872.3 458.9 445.9 619.7 589.0 428.8
Philadelphia Metro 2,591.5 1,073.3 636.6 555.1 734.6 592.6 795.9 890.5 803.0 389.4 452.2 456.7 415.3 420.0
North Central 1,397.3 669.6 433.7 268.5 464.0 367.0 385.6 532.7 632.6 410.5 336.7 380.9 359.9 375.3
South Central 446.9 110.4 69.3 65.5 130.1 96.1 64.3 152.8 91.3 25.3 75.2 102.1 96.0 141.1
Upstate NY 293.9 159.1 104.5 122.7 104.8 60.1 156.1 136.5 92.3 26.9 44.8 112.7 48.6 112.5
Sacramento/N.Cal 372.3 203.0 65.4 32.2 38.4 37.7 29.4 82.0 71.3 18.8 16.5 67.8 20.0 25.2
Unknown 50.4 14.3 - - - - - - - 0.5 - - - 21.1
AK/HI/PR 248.6 69.8 4.9 17.9 15.1 43.3 47.1 20.9 21.3 7.4 14.0 0.6 0.7 2.5
Total 105,104.6 40,952.1 22,177.1 19,620.0 23,208.8 23,524.5 27,514.5 31,942.9 29,948.9 20,286.2 23,368.6 29,730.0 27,352.3 9,545.2
Figure 3.09
Venture Capital Investments in 1985-2013 By Region (Number of Deals)
Region 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Silicon Valley 323 339 343 362 395 398 337 422 315 335 509 771 869 1,045 1,687 2,159 1,106 819 879
NY Metro 89 101 131 108 121 90 89 81 79 84 136 158 240 273 491 816 446 231 192
New England 235 214 257 231 222 217 170 159 149 146 232 333 384 469 662 905 595 458 446
Midwest 100 116 133 101 127 103 99 93 85 83 132 190 237 249 309 515 276 243 174
LA/Orange County 90 101 114 106 112 97 89 97 63 54 92 134 166 216 355 516 250 164 149
Southeast 91 118 134 115 115 131 111 108 117 112 182 226 294 308 454 664 391 268 247
DC/Metroplex 45 46 65 59 51 62 54 48 41 47 72 113 135 162 272 509 261 198 183
Northwest 47 49 62 70 64 48 41 50 49 50 84 112 134 132 263 331 192 141 108
Texas 106 93 106 105 91 85 70 70 72 68 101 135 172 197 318 485 343 174 174
Philadelphia Metro 38 35 54 44 41 48 43 65 47 45 78 91 142 138 145 231 142 103 88
San Diego 43 35 54 56 56 47 43 47 49 61 77 109 100 124 162 235 156 114 125
Colorado 43 58 62 63 53 49 35 53 48 53 58 83 98 127 161 222 115 91 71
SouthWest 20 30 42 25 32 22 30 34 30 29 37 55 71 88 116 146 89 68 55
North Central 38 50 54 51 39 44 40 39 38 37 70 69 116 107 114 151 126 76 71
Upstate NY 17 10 10 10 12 6 4 9 10 5 8 9 21 31 31 36 29 24 22
South Central 11 10 12 6 7 5 4 5 6 9 15 22 25 27 30 50 28 24 21
Unknown - - 1 2 3 1 1 2 4 2 2 7 7 14 3 16 8 - -
Sacramento/N.Cal 11 18 12 10 6 10 9 9 8 10 7 9 7 17 19 36 27 7 11
AK/HI/PR 1 - - - - - 3 3 1 2 4 9 6 5 5 15 10 3 8
Total 1,348 1,423 1,646 1,524 1,547 1,463 1,272 1,394 1,211 1,232 1,896 2,635 3,224 3,729 5,597 8,038 4,590 3,206 3,024
Venture Capital Investments in 1985-2013 By Region (Number of Deals)
Region 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Silicon Valley 970 1,006 1,235 1,311 1,300 997 1,108 1,269 1,225 1,257
NY Metro 226 191 295 299 343 285 387 424 411 446
New England 430 441 458 524 508 388 414 457 466 418
Midwest 178 181 228 271 304 250 277 316 311 416
LA/Orange County 151 177 219 236 245 177 228 233 268 253
Southeast 244 198 235 247 230 158 215 209 172 211
DC/Metroplex 187 221 218 221 210 138 154 167 166 171
Northwest 148 159 182 217 201 128 156 165 154 165
Texas 176 181 201 188 162 126 168 172 163 154
Philadelphia Metro 104 96 116 135 150 97 127 123 126 135
San Diego 132 143 130 169 134 114 135 114 106 98
Colorado 72 91 112 114 116 91 84 109 105 81
SouthWest 58 84 92 107 86 71 60 85 84 79
North Central 77 66 73 94 87 69 59 70 53 73
Upstate NY 29 28 40 33 31 13 21 22 23 36
South Central 31 11 26 31 41 33 42 59 23 29
Unknown - - - 1 - 1 1 1 - 10
Sacramento/N.Cal 9 11 8 18 20 9 7 6 5 6
AK/HI/PR 6 8 14 10 9 3 4 3 4 3
Total 3,228 3,293 3,882 4,226 4,177 3,148 3,647 4,004 3,865 4,041
Figure 3.10
Venture Capital Investments in 1985-2013 By Stage
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Seed 528.9 759.7 623.4 670.2 559.3 396.6 241.8 557.7 629.6 781.2 1,273.0 1,275.0 1,366.6 1,769.3 3,617.8 3,150.4 803.5
Early Stage 506.8 624.0 748.8 714.6 737.9 684.8 548.4 577.9 574.9 839.7 1,733.1 2,636.8 3,455.1 5,460.1 11,480.6 25,292.6 8,591.3
Expansion 1,243.9 1,198.2 1,490.6 1,568.8 1,600.3 1,265.6 1,099.6 1,770.1 1,867.0 1,506.9 3,561.7 5,503.0 7,564.1 10,322.5 29,254.7 59,047.2 22,898.7
Later Stage 499.4 550.4 498.5 457.7 435.5 486.0 369.8 688.5 591.7 1,002.4 1,447.0 1,926.9 2,618.8 3,921.0 10,493.6 17,614.5 8,658.6
Total 2,779.0 3,132.3 3,361.3 3,411.3 3,333.0 2,833.1 ,259.7 3,594.2 3,663.2 4,130.1 8,014.8 11,341.6 15,004.6 21,473.0 54,846.7 105,104.6 40,952.1
Venture Capital Investments in 1985-2013 By Stage
Stage 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Seed 340.7 364.9 916.9 995.6 1,291.6 1,837.0 1,923.1 1,735.2 1,676.3 1,079.4 836.4 966.4
Early Stage 3,979.7 3,582.2 4,040.8 4,057.9 4,770.4 6,087.3 5,888.9 4,940.6 5,913.8 8,926.9 8,315.1 9,896.0
Expansion 12,122.6 9,764.9 9,053.6 8,521.7 11,123.5 1,065.7 10,725.1 6,841.2 8,706.9 9,829.3 9,446.6 9,814.2
Later Stage 5,734.1 5,908.0 9,197.5 9,949.3 0,329.0 2,952.9 11,411.9 6,769.2 7,071.6 9,894.4 8,754.2 8,868.7
Total 22,177.1 19,620.0 23,208.8 23,524.5 7,514.5 1,942.9 29,948.9 20,286.2 23,368.6 9,730.0 27,352.3 29,545.2
Figure 3.11
Venture Capital Investments in 1985-2013 By Stage (Number of Deals)
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Seed 358 388 387 370 355 258 193 252 290 332 431 503 542 672 811 705 281
Early Stage 290 333 411 358 338 371 277 292 181 255 519 751 897 1,019 1,735 2,852 1,298
Expansion 523 502 614 614 665 600 541 603 513 422 705 1,043 1,399 1,569 2,438 3,698 2,391
Later Stage 177 200 234 182 189 234 261 247 227 223 241 338 386 469 613 783 620
Total 1,348 1,423 1,646 1,524 1,547 1,463 1,272 1,394 1,211 1,232 1,896 2,635 3,224 3,729 5,597 8,038 4,590
Venture Capital Investments in 1985-2013 By Stage (Number of Deals)
Stage 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Seed 182 217 235 264 398 528 536 374 410 446 296 221
Early Stage 879 800 903 855 1,002 1,137 1,152 979 1,287 1,603 1,738 2,031
Expansion 1,580 1,352 1,203 1,113 1,381 1,269 1,240 894 1,077 1,026 987 991
Later Stage 565 655 887 1,061 1,101 1,292 1,249 901 873 929 844 798
Total 3,206 3,024 3,228 3,293 3,882 4,226 4,177 3,148 3,647 4,004 3,865 4,041
Figure 3.12a
Quarterly Venture Capital Investments 1985-2013 By Stage ($ Millions)
1985 1986 1987
Stage 1985-1Q 1985-2Q 1985-3Q 1985-4Q 1985 Total 1986-1Q 1986-2Q 1986-3Q 1986-4Q 1986 Total 1987-1Q 1987-2Q 1987-3Q 1987-4Q 1987 Total
Seed 153.0 149.3 93.7 133.0 528.9 185.6 270.0 114.7 189.4 759.7 145.7 199.4 142.0 136.3 623.4
Early Stage 95.9 185.3 95.2 130.4 506.8 129.6 139.5 176.6 178.2 624.0 170.7 183.9 204.2 190.0 748.8
Expansion 219.2 319.2 312.8 392.7 1,243.9 270.2 381.4 252.3 294.3 1,198.2 421.8 352.2 402.5 314.1 1,490.6
Later Stage 154.6 89.8 175.5 79.5 499.4 125.6 96.7 180.4 147.7 550.4 100.1 167.0 119.8 111.7 498.5
Total 622.6 743.6 677.2 735.6 2,779.0 711.0 887.5 724.1 809.6 3,132.3 838.2 902.4 868.5 752.2 3,361.3
Figure 3.12b
1988 1989 1990
Seed 164.5 150.0 240.6 115.2 670.2 138.1 174.6 116.3 130.3 559.3 81.9 116.7 114.3 83.8 396.6
Early Stage 144.0 216.6 184.7 169.4 714.6 255.9 128.0 163.1 190.9 737.9 139.7 199.1 133.1 212.9 684.8
Expansion 314.5 494.6 320.2 439.5 1,568.8 399.6 426.5 305.5 468.8 1,600.3 307.2 352.6 208.0 397.9 1,265.6
Later Stage 135.3 105.0 151.4 66.0 457.7 95.5 105.3 78.3 156.4 435.5 123.1 119.9 126.3 116.7 486.0
Total 758.3 966.1 896.9 790.0 3,411.3 889.1 834.4 663.1 946.4 3,333.0 651.9 788.2 581.6 811.3 2,833.1
Figure 3.12c
1991 1992 1993
Seed 45.8 84.6 53.4 58.0 241.8 67.6 210.4 71.8 207.8 557.7 139.7 144.1 164.3 181.5 629.6
Early Stage 137.7 130.3 140.4 140.0 548.4 134.0 187.6 102.7 153.6 577.9 164.0 136.1 106.6 168.2 574.9
Expansion 249.5 276.2 257.0 317.0 1,099.6 496.0 434.8 343.9 495.4 1,770.1 357.1 412.3 461.3 636.3 1,867.0
Later Stage 89.5 115.8 63.7 100.8 369.8 211.2 163.2 115.3 198.8 688.5 189.5 111.6 116.8 173.8 591.7
Total 522.5 606.9 514.5 615.7 2,259.7 908.8 996.1 633.8 1,055.5 3,594.2 850.3 804.1 849.0 1,159.8 3,663.2
Figure 3.12d
1994 1995 1996
Seed 190.0 225.8 160.2 205.1 781.2 316.8 396.6 229.9 329.8 1,273.0 330.0 427.9 200.6 316.5 1,275.0
Early Stage 177.6 196.4 157.8 307.9 839.7 408.8 393.6 366.8 563.8 1,733.1 596.2 712.9 573.6 754.1 2,636.8
Expansion 310.5 388.5 327.7 480.1 1,506.9 620.0 1,325.7 800.4 815.7 3,561.7 1,151.9 1,506.8 1,277.0 1,567.3 5,503.0
Later Stage 201.3 192.5 262.0 346.6 1,002.4 344.5 430.5 308.7 363.4 1,447.0 348.0 461.3 546.5 571.1 1,926.9
Total 879.4 1,003.3 907.8 1,339.7 4,130.1 1,690.0 2,546.4 1,705.8 2,072.6 8,014.8 2,426.1 3,109.0 2,597.6 3,208.9 11,341.6
Figure 3.12e
1997 1998 1999
Seed 392.9 330.8 323.4 319.5 1,366.6 405.4 426.4 459.9 477.6 1,769.3 591.5 799.7 990.1 1,236.5 3,617.8
Early Stage 773.5 846.8 760.1 1,074.7 3,455.1 1,164.7 1,014.5 1,290.4 1,990.6 5,460.1 1,302.0 2,026.8 2,661.8 5,489.9 11,480.6
Expansion 1,354.4 1,938.5 1,970.1 2,301.0 7,564.1 1,753.9 3,350.1 2,690.5 2,528.0 10,322.5 3,108.3 5,487.4 7,325.5 13,333.5 29,254.7
Later Stage 601.4 551.6 669.8 795.9 2,618.8 854.6 973.6 955.0 1,137.9 3,921.0 1,620.2 3,004.2 2,620.1 3,249.1 10,493.6
Total 3,122.3 3,667.8 3,723.4 4,491.2 15,004.6 4,178.5 5,764.5 5,395.7 6,134.2 21,473.0 6,622.0 11,318.1 13,597.5 23,309.1 54,846.7
Figure 3.12f
2000 2001 2002
Seed 808.6 984.1 870.9 486.8 3,150.4 256.6 265.6 128.5 152.7 803.5 76.4 94.0 84.2 86.1 340.7
Early Stage 7,137.5 6,937.9 5,903.8 5,313.5 25,292.6 3,447.7 2,104.5 1,720.2 1,318.9 8,591.3 1,209.5 1,138.0 827.7 804.5 3,979.7
Expansion 16,100.4 15,726.9 15,253.6 11,966.2 59,047.2 6,905.3 6,622.1 4,588.8 4,782.5 22,898.7 3,804.8 3,535.3 2,461.7 2,320.8 12,122.6
Later Stage 4,382.9 4,357.2 4,582.9 4,291.6 17,614.5 2,459.6 2,515.1 1,793.4 1,890.5 8,658.6 1,932.6 1,345.6 1,096.5 1,359.4 5,734.1
Total 28,429.3 28,006.1 26,611.1 22,058.1 105,104.6 13,069.2 11,507.4 8,230.9 8,144.7 40,952.1 7,023.4 6,112.9 4,470.0 4,570.8 22,177.1
Figure 3.12g
2003 2004 2005
Seed 83.3 95.3 100.3 86.0 364.9 104.8 124.3 118.1 569.7 916.9 139.3 529.0 165.0 162.2 995.6
Early Stage 676.2 1,011.5 806.8 1,087.7 3,582.2 904.9 1,030.3 1,028.5 1,077.0 4,040.8 907.8 992.9 1,186.2 971.0 4,057.9
Expansion 2,468.1 2,508.0 2,165.5 2,623.3 9,764.9 2,069.3 2,680.0 2,042.6 2,261.7 9,053.6 2,092.9 2,336.1 1,759.6 2,333.2 8,521.7
Later Stage 1,160.2 1,374.6 1,520.5 1,852.6 5,908.0 2,312.6 2,481.9 1,856.6 2,546.4 9,197.5 2,082.1 2,579.1 2,952.5 2,335.5 9,949.3
Total 4,387.8 4,989.4 4,593.1 5,649.7 19,620.0 5,391.6 6,316.6 5,045.8 6,454.8 23,208.8 5,222.1 6,437.1 6,063.2 5,802.0 23,524.5
Figure 3.12h
2006 2007 2008
Seed 249.2 367.6 372.1 302.7 1,291.6 315.8 500.0 462.4 558.7 1,837.0 459.3 528.3 557.7 377.9 1,923.1
Early Stage 930.6 1,022.2 1,143.1 1,674.5 4,770.4 1,341.1 1,706.4 1,259.8 1,780.0 6,087.3 1,401.6 1,571.4 1,382.2 1,533.6 5,888.9
Expansion 2,594.2 3,218.2 2,863.1 2,448.0 11,123.5 2,641.8 2,335.6 3,102.0 2,986.4 11,065.7 3,421.3 2,657.7 2,549.7 2,096.4 10,725.1
Later Stage 2,832.4 2,778.3 2,473.8 2,244.5 10,329.0 3,151.4 3,297.7 3,378.0 3,125.8 12,952.9 2,827.0 3,275.0 3,126.9 2,183.1 11,411.9
Total 6,606.5 7,386.3 6,852.0 6,669.7 27,514.5 7,450.1 7,839.8 8,202.2 8,450.9 31,942.9 8,109.1 8,032.4 7,616.5 6,191.0 29,948.9
Figure 3.12i
2009 2010 2011
Seed 319.7 536.0 511.0 368.5 1,735.2 416.7 689.0 338.7 231.9 1,676.3 219.6 424.4 227.4 208.1 1,079.4
Early Stage 768.2 1,178.5 1,240.7 1,753.2 4,940.6 1,149.7 1,732.4 1,457.3 1,574.5 5,913.8 1,861.1 2,307.7 2,244.0 2,514.1 8,926.9
Expansion 1,233.0 1,779.0 1,829.0 2,000.2 6,841.2 1,820.2 2,788.6 1,670.2 2,428.0 8,706.9 2,210.7 2,457.8 2,579.8 2,580.9 9,829.3
Later Stage 1,527.1 1,600.6 1,844.7 1,796.7 6,769.2 1,702.2 1,915.0 1,985.5 1,468.8 7,071.6 2,236.0 3,007.4 2,506.0 2,145.1 9,894.4
Total 3,848.0 5,094.2 5,425.5 5,918.6 20,286.2 5,088.8 7,125.0 5,451.7 5,703.2 23,368.6 6,527.4 8,197.3 7,557.2 7,448.2 29,730.0
Figure 3.12j
2012 2013
Stage 2012-1Q 2012-2Q 2012-3Q 2012-4Q 2012 Total 2013-1Q 2013-2Q 2013-3Q 2013-4Q 2013 Total
Seed 187.4 282.5 179.3 187.2 836.4 208.7 227.9 192.2 337.5 966.4
Early Stage 1,956.2 2,184.2 1,932.5 2,242.2 8,315.1 1,551.5 2,536.9 2,862.0 2,945.6 9,896.0
Expansion 1,810.0 2,763.6 2,580.5 2,292.5 9,446.6 2,057.7 2,215.5 2,537.0 3,004.0 9,814.2
Later Stage 2,356.5 2,170.9 1,985.2 2,241.6 8,754.2 2,190.4 2,125.8 2,333.2 2,219.3 8,868.7
Total 6,310.1 7,401.1 6,677.5 6,963.5 27,352.3 6,008.3 7,106.1 7,924.4 8,506.4 29,545.2
Figure 3.13a
Quarterly Venture Capital Investments 1985-2013 By Stage (Number of Deals)
1985 1986 1987
Seed 110 89 61 98 358 134 107 65 82 388 116 101 85 85 387
Early Stage 88 69 59 74 290 111 71 72 79 333 131 83 102 95 411
Expansion 138 121 114 150 523 166 136 95 105 502 182 138 158 136 614
Later Stage 66 41 38 32 177 61 56 31 52 200 64 65 52 53 234
Total 402 320 272 354 1,348 472 370 263 318 1,423 493 387 397 369 1,646
Figure 3.13b
1988 1989 1990
Seed 119 79 88 84 370 106 100 77 72 355 60 69 59 70 258
Early Stage 99 94 87 78 358 101 65 84 88 338 88 97 73 113 371
Expansion 158 181 133 142 614 216 158 127 164 665 148 151 144 157 600
Later Stage 54 48 42 38 182 52 35 38 64 189 55 59 49 71 234
Total 430 402 350 342 1,524 475 358 326 388 1,547 351 376 325 411 1,463
Figure 3.13c
1991 1992 1993
Seed 51 49 42 51 193 49 68 49 86 252 69 68 66 87 290
Early Stage 78 69 60 70 277 73 86 52 81 292 40 48 38 55 181
Expansion 137 127 124 153 541 155 160 103 185 603 144 121 116 132 513
Later Stage 49 69 56 87 261 77 46 45 79 247 68 54 52 53 227
Total 315 314 282 361 1,272 354 360 249 431 1,394 321 291 272 327 1,211
Figure 3.13d
1994 1995 1996
Seed 91 67 83 91 332 125 95 95 116 431 130 139 97 137 503
Early Stage 64 61 53 77 255 130 137 116 136 519 147 205 174 225 751
Expansion 101 110 96 115 422 187 178 164 176 705 235 246 245 317 1,043
Later Stage 53 69 43 58 223 61 56 58 66 241 72 83 86 97 338
Total 309 307 275 341 1,232 503 466 433 494 1,896 584 673 602 776 2,635
Figure 3.12e
1997 1998 1999
Seed 392.9 330.8 323.4 319.5 1,366.6 405.4 426.4 459.9 477.6 1,769.3 591.5 799.7 990.1 1,236.5 3,617.8
Early Stage 773.5 846.8 760.1 1,074.7 3,455.1 1,164.7 1,014.5 1,290.4 1,990.6 5,460.1 1,302.0 2,026.8 2,661.8 5,489.9 11,480.6
Expansion 1,354.4 1,938.5 1,970.1 2,301.0 7,564.1 1,753.9 3,350.1 2,690.5 2,528.0 10,322.5 3,108.3 5,487.4 7,325.5 13,333.5 29,254.7
Later Stage 601.4 551.6 669.8 795.9 2,618.8 854.6 973.6 955.0 1,137.9 3,921.0 1,620.2 3,004.2 2,620.1 3,249.1 10,493.6
Total 3,122.3 3,667.8 3,723.4 4,491.2 15,004.6 4,178.5 5,764.5 5,395.7 6,134.2 21,473.0 6,622.0 11,318.1 13,597.5 23,309.1 54,846.7
Figure 3.12f
2000 2001 2002
Seed 808.6 984.1 870.9 486.8 3,150.4 256.6 265.6 128.5 152.7 803.5 76.4 94.0 84.2 86.1 340.7
Early Stage 7,137.5 6,937.9 5,903.8 5,313.5 25,292.6 3,447.7 2,104.5 1,720.2 1,318.9 8,591.3 1,209.5 1,138.0 827.7 804.5 3,979.7
Expansion 16,100.4 15,726.9 15,253.6 11,966.2 59,047.2 6,905.3 6,622.1 4,588.8 4,782.5 22,898.7 3,804.8 3,535.3 2,461.7 2,320.8 12,122.6
Later Stage 4,382.9 4,357.2 4,582.9 4,291.6 17,614.5 2,459.6 2,515.1 1,793.4 1,890.5 8,658.6 1,932.6 1,345.6 1,096.5 1,359.4 5,734.1
Total 28,429.3 28,006.1 26,611.1 22,058.1 105,104.6 13,069.2 11,507.4 8,230.9 8,144.7 40,952.1 7,023.4 6,112.9 4,470.0 4,570.8 22,177.1
Figure 3.12g
2003 2004 2005
Seed 83.3 95.3 100.3 86.0 364.9 104.8 124.3 118.1 569.7 916.9 139.3 529.0 165.0 162.2 995.6
Early Stage 676.2 1,011.5 806.8 1,087.7 3,582.2 904.9 1,030.3 1,028.5 1,077.0 4,040.8 907.8 992.9 1,186.2 971.0 4,057.9
Expansion 2,468.1 2,508.0 2,165.5 2,623.3 9,764.9 2,069.3 2,680.0 2,042.6 2,261.7 9,053.6 2,092.9 2,336.1 1,759.6 2,333.2 8,521.7
Later Stage 1,160.2 1,374.6 1,520.5 1,852.6 5,908.0 2,312.6 2,481.9 1,856.6 2,546.4 9,197.5 2,082.1 2,579.1 2,952.5 2,335.5 9,949.3
Total 4,387.8 4,989.4 4,593.1 5,649.7 19,620.0 5,391.6 6,316.6 5,045.8 6,454.8 23,208.8 5,222.1 6,437.1 6,063.2 5,802.0 23,524.5
Figure 3.12h
2006 2007 2008
Seed 249.2 367.6 372.1 302.7 1,291.6 315.8 500.0 462.4 558.7 1,837.0 459.3 528.3 557.7 377.9 1,923.1
Early Stage 930.6 1,022.2 1,143.1 1,674.5 4,770.4 1,341.1 1,706.4 1,259.8 1,780.0 6,087.3 1,401.6 1,571.4 1,382.2 1,533.6 5,888.9
Expansion 2,594.2 3,218.2 2,863.1 2,448.0 11,123.5 2,641.8 2,335.6 3,102.0 2,986.4 11,065.7 3,421.3 2,657.7 2,549.7 2,096.4 10,725.1
Later Stage 2,832.4 2,778.3 2,473.8 2,244.5 10,329.0 3,151.4 3,297.7 3,378.0 3,125.8 12,952.9 2,827.0 3,275.0 3,126.9 2,183.1 11,411.9
Total 6,606.5 7,386.3 6,852.0 6,669.7 27,514.5 7,450.1 7,839.8 8,202.2 8,450.9 31,942.9 8,109.1 8,032.4 7,616.5 6,191.0 29,948.9
Figure 3.13i
2009 2010 2011
Seed 70 87 99 118 374 93 120 100 97 410 93 129 114 110 446
Early Stage 195 212 249 323 979 271 361 318 337 1,287 353 398 408 444 1,603
Expansion 186 220 219 269 894 253 305 242 277 1,077 223 277 282 244 1,026
Later Stage 229 242 199 231 901 207 237 228 201 873 237 281 214 197 929
Total 680 761 766 941 3,148 824 1,023 888 912 3,647 906 1,085 1,018 995 4,004
Figure 3.13j
2012 2013
Stage 2012-1Q 2012-2Q 2012-3Q 2012-4Q 2012 Total 2013-1Q 2013-2Q 2013-3Q 2013-4Q 2013 Total
Seed 65 88 72 71 296 53 47 53 68 221
Early Stage 359 445 428 506 1,738 420 512 564 535 2,031
Expansion 225 255 252 255 987 236 231 244 280 991
Later Stage 233 195 194 222 844 203 195 187 213 798
Total 882 983 946 1,054 3,865 912 985 1,048 1,096 4,041
Figure 3.14
Venture Capital Investments 1985-2013 By Industry ($ Millions)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
Biotechnology 136 223 290 369 336 316 292 599 483 578 832 1,192 1,368 1,554 2,104 4,293
Business Products and Services 29 81 64 53 52 94 77 39 70 30 188 291 437 715 2,561 4,661
Computers and Peripherals 450 473 392 370 312 245 174 205 164 178 316 358 394 383 958 1,636
Consumer Products and Services 69 135 176 153 86 169 126 123 162 176 522 507 742 692 2,715 3,221
Electronics/Instrumentation 119 118 120 72 104 57 72 51 50 63 151 200 307 198 272 779
Financial Services 81 92 62 209 233 63 25 120 102 124 181 319 383 843 2,128 4,131
Healthcare Services 81 129 138 97 155 92 72 191 204 202 460 734 939 959 1,495 1,396
Industrial/Energy 201 208 290 222 345 243 183 272 281 296 527 495 695 1,257 1,427 2,637
IT Services 21 45 51 52 47 38 38 29 54 119 175 534 641 1,076 4,319 8,863
Media and Entertainment 101 119 155 166 151 93 69 132 278 275 944 1,154 1,080 1,865 7,394 0,613
Medical Devices and Equipment 184 182 258 340 347 322 235 515 388 438 668 619 1,027 1,251 1,581 2,404
Networking and Equipment 225 164 143 137 197 174 140 250 516 250 372 628 962 1,436 4,604 1,557
Other 3 3 0 6 - 0 33 0 6 6 38 21 67 90 214 60
Retailing/Distribution 32 121 296 232 217 89 48 97 103 103 303 269 326 749 2,842 3,206
Semiconductors 255 296 257 299 171 191 92 156 93 159 214 346 597 631 1,378 3,802
Software 618 570 519 477 458 519 466 614 460 671 1,188 2,352 3,485 4,769 10,899 25,482
Telecommunications 177 174 148 159 124 128 117 201 250 463 937 1,321 1,556 3,006 7,957 16,364
Unknown - - - - - - - - - - - - - - - -
Total 2,779 3,132 3,361 3,411 3,333 2,833 ,260 3,594 3,663 4,130 8,015 11,342 15,005 21,473 54,847 105,105
Industry 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 3,503 3,331 3,675 4,402 3,987 4,876 5,843 5,138 3,909 3,970 4,777 4,191 4,562
Business Products and Services 1,076 475 673 466 372 593 596 466 252 437 194 130 218
Computers and Peripherals 709 457 362 530 551 394 569 419 341 375 490 436 517
Consumer Products and Services 702 256 157 331 385 420 441 400 492 661 1,432 1,335 1,245
Electronics/Instrumentation 366 300 194 375 397 669 542 605 379 390 423 250 324
Financial Services 1,204 331 413 532 907 524 574 481 381 391 317 276 536
Healthcare Services 556 380 234 382 379 380 344 165 141 250 299 333 286
Industrial/Energy 1,248 823 734 843 1,131 1,941 3,046 4,537 2,564 3,421 3,753 2,904 1,507
IT Services 2,520 1,017 731 771 999 1,510 1,924 2,106 1,257 1,699 2,627 1,893 1,993
Media and Entertainment 2,368 788 669 1,374 1,203 1,863 2,200 1,877 1,650 1,576 2,307 2,134 2,936
Medical Devices and Equipment 2,085 1,894 1,660 1,919 2,170 2,777 3,694 3,648 2,586 2,363 2,935 2,549 2,130
Networking and Equipment 5,714 2,627 1,726 1,537 1,661 1,222 1,388 776 697 564 370 317 670
Other 55 17 - 14 0 - 3 5 28 8 13 48 99
Retailing/Distribution 368 139 64 217 249 189 340 199 133 149 380 370 240
Semiconductors 2,473 1,655 1,761 2,157 1,851 2,307 2,058 1,586 808 1,110 1,350 894 597
Software 10,864 5,525 4,945 5,520 5,251 5,495 6,219 6,008 4,085 5,257 7,472 8,573 11,020
Telecommunications 5,142 2,163 1,620 1,841 2,032 2,355 2,162 1,533 582 746 590 718 644
Unknown - - - - - - - - - - - - 21
Total 40,952 22,177 19,620 23,209 23,524 27,515 31,943 29,949 20,286 23,369 29,730 27,352 29,545
Figure 3.14
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
Biotechnology 136 223 290 369 336 316 292 599 483 578 832 1,192 1,368 1,554 2,104 4,293
Business Products and Services 29 81 64 53 52 94 77 39 70 30 188 291 437 715 2,561 4,661
Computers and Peripherals 450 473 392 370 312 245 174 205 164 178 316 358 394 383 958 1,636
Consumer Products and Services 69 135 176 153 86 169 126 123 162 176 522 507 742 692 2,715 3,221
Electronics/Instrumentation 119 118 120 72 104 57 72 51 50 63 151 200 307 198 272 779
Financial Services 81 92 62 209 233 63 25 120 102 124 181 319 383 843 2,128 4,131
Healthcare Services 81 129 138 97 155 92 72 191 204 202 460 734 939 959 1,495 1,396
Industrial/Energy 201 208 290 222 345 243 183 272 281 296 527 495 695 1,257 1,427 2,637
IT Services 21 45 51 52 47 38 38 29 54 119 175 534 641 1,076 4,319 8,863
Media and Entertainment 101 119 155 166 151 93 69 132 278 275 944 1,154 1,080 1,865 7,394 0,613
Medical Devices and Equipment 184 182 258 340 347 322 235 515 388 438 668 619 1,027 1,251 1,581 2,404
Networking and Equipment 225 164 143 137 197 174 140 250 516 250 372 628 962 1,436 4,604 1,557
Other 3 3 0 6 - 0 33 0 6 6 38 21 67 90 214 60
Retailing/Distribution 32 121 296 232 217 89 48 97 103 103 303 269 326 749 2,842 3,206
Semiconductors 255 296 257 299 171 191 92 156 93 159 214 346 597 631 1,378 3,802
Software 618 570 519 477 458 519 466 614 460 671 1,188 2,352 3,485 4,769 10,899 25,482
Telecommunications 177 174 148 159 124 128 117 201 250 463 937 1,321 1,556 3,006 7,957 16,364
Unknown - - - - - - - - - - - - - - - -
Total 2,779 3,132 3,361 3,411 3,333 2,833 ,260 3,594 3,663 4,130 8,015 11,342 15,005 21,473 54,847 105,105
Industry 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 3,503 3,331 3,675 4,402 3,987 4,876 5,843 5,138 3,909 3,970 4,777 4,191 4,562
Business Products and Services 1,076 475 673 466 372 593 596 466 252 437 194 130 218
Computers and Peripherals 709 457 362 530 551 394 569 419 341 375 490 436 517
Consumer Products and Services 702 256 157 331 385 420 441 400 492 661 1,432 1,335 1,245
Electronics/Instrumentation 366 300 194 375 397 669 542 605 379 390 423 250 324
Financial Services 1,204 331 413 532 907 524 574 481 381 391 317 276 536
Healthcare Services 556 380 234 382 379 380 344 165 141 250 299 333 286
Industrial/Energy 1,248 823 734 843 1,131 1,941 3,046 4,537 2,564 3,421 3,753 2,904 1,507
IT Services 2,520 1,017 731 771 999 1,510 1,924 2,106 1,257 1,699 2,627 1,893 1,993
Media and Entertainment 2,368 788 669 1,374 1,203 1,863 2,200 1,877 1,650 1,576 2,307 2,134 2,936
Medical Devices and Equipment 2,085 1,894 1,660 1,919 2,170 2,777 3,694 3,648 2,586 2,363 2,935 2,549 2,130
Networking and Equipment 5,714 2,627 1,726 1,537 1,661 1,222 1,388 776 697 564 370 317 670
Other 55 17 - 14 0 - 3 5 28 8 13 48 99
Retailing/Distribution 368 139 64 217 249 189 340 199 133 149 380 370 240
Semiconductors 2,473 1,655 1,761 2,157 1,851 2,307 2,058 1,586 808 1,110 1,350 894 597
Software 10,864 5,525 4,945 5,520 5,251 5,495 6,219 6,008 4,085 5,257 7,472 8,573 11,020
Telecommunications 5,142 2,163 1,620 1,841 2,032 2,355 2,162 1,533 582 746 590 718 644
Unknown - - - - - - - - - - - - 21
Total 40,952 22,177 19,620 23,209 23,524 27,515 31,943 29,949 20,286 23,369 29,730 27,352 29,545
Figure 3.15
Venture Capital Investments 1985-2013 By Industry (Number of Deals)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 73 98 138 153 139 146 140 167 136 139 176 235 244 275 264
Business Products and Services 20 42 51 38 32 28 20 25 32 21 53 70 95 138 277
Computers and Peripherals 158 148 131 138 136 104 78 84 65 66 93 94 115 92 106
Consumer Products and Services 43 51 72 59 52 67 48 51 54 66 110 131 162 164 286
Electronics/Instrumentation 74 66 68 55 58 49 46 38 27 36 49 43 52 54 51
Financial Services 22 27 36 43 44 25 24 24 31 31 47 60 89 115 189
Healthcare Services 33 57 56 46 55 41 38 46 53 45 73 139 152 155 159
Industrial/Energy 122 138 162 138 144 158 124 131 102 101 128 155 211 185 202
IT Services 22 26 33 26 28 32 29 22 19 33 62 128 160 207 457
Media and Entertainment 56 68 92 75 71 58 54 79 82 97 138 191 217 263 701
Medical Devices and Equipment 129 117 166 151 184 189 159 187 147 128 179 213 273 297 290
Networking and Equipment 81 76 73 70 71 74 65 83 62 74 82 123 140 211 274
Other 2 2 2 1 2 2 2 3 2 10 9 10 9 20
Retailing/Distribution 19 34 71 81 73 46 38 34 35 27 54 70 91 120 231
Semiconductors 87 74 94 93 82 79 52 60 45 39 64 76 118 119 148
Software 322 322 307 279 297 302 288 296 243 252 436 688 829 988 1,420
Telecommunications 85 77 94 78 81 63 67 65 75 75 142 210 266 337 522
Total 1,348 1,423 1,646 1,524 1,547 1,463 1,272 1,394 1,211 1,232 1,896 2,635 3,224 3,729 5,597
Figure 3.15
Venture Capital Investments 1985-2013 By Industry (Number of Deals)
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 358 342 331 358 404 413 487 539 544 463 504 468 478 474
Business Products and Services 454 176 101 97 83 78 95 111 116 68 76 59 39 66
Computers and Peripherals 133 82 59 57 60 66 62 72 59 52 52 59 43 34
Consumer Products and Services 286 119 72 47 66 77 79 110 103 88 116 139 170 171
Electronics/Instrumentation 73 55 62 53 69 82 93 90 93 61 68 59 51 42
Financial Services 334 136 76 64 70 65 88 87 68 50 73 57 53 62
Healthcare Services 166 106 70 71 63 66 52 57 50 38 46 45 43 42
Industrial/Energy 254 201 128 136 157 152 224 306 358 262 303 320 257 240
IT Services 686 327 174 149 155 174 240 284 282 218 296 366 297 344
Media and Entertainment 950 372 168 129 142 210 330 402 411 279 346 436 410 455
Medical Devices and Equipment 296 259 236 250 284 279 356 395 400 343 345 372 322 311
Networking and Equipment 478 329 227 184 190 183 130 137 106 95 56 48 32 25
Other 12 11 3 1 6 3 2 10 4 6 11 10 13 22
Retailing/Distribution 282 84 49 31 38 40 40 41 39 35 32 64 57 49
Semiconductors 256 209 170 215 257 219 265 228 210 136 146 136 113 92
Software 2,168 1,303 1,006 969 952 952 1,031 1,078 1,115 831 1,066 1,256 1,391 1,547
Telecommunications 852 479 274 213 232 234 308 279 219 123 111 110 96 65
Total 8,038 4,590 3,206 3,024 3,228 3,293 3,882 4,226 4,177 3,148 3,647 4,004 3,865 4,041
Figure 3.16
Venture Capital Investments 1985-2013 By State ($ Millions)
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
California 1,070.9 1,343.8 1,266.7 1,391.8 1,309.8 1,221.6 1,031.3 1,437.2 1,232.1 1,503.8 3,108.7 4,634.4 6,044.9 7,868.2 22,947.2 42,882.9
Massachusetts 396.3 379.5 446.0 387.8 296.8 350.9 240.0 366.3 310.9 385.9 697.2 1,053.9 1,438.6 2,002.1 5,065.7 10,557.1
New York 114.5 75.4 100.5 112.1 158.7 48.8 45.0 143.8 103.9 69.9 303.3 293.3 786.2 1,402.1 3,508.1 6,690.8
Texas 248.6 228.4 211.0 240.7 229.2 141.0 161.4 150.5 241.9 313.8 479.2 553.4 908.7 1,205.6 3,163.1 6,270.8
Washington 55.4 66.1 98.3 73.3 74.8 55.2 29.2 191.5 85.4 137.6 325.9 466.9 434.2 736.5 2,340.7 2,792.3
Maryland 46.8 20.8 30.5 46.1 87.7 47.6 36.4 30.1 343.5 55.9 140.0 139.5 188.3 349.9 616.5 1,961.5
Virginia 32.3 23.5 76.4 66.6 51.8 46.7 14.0 30.9 39.5 77.6 279.4 440.1 297.9 749.7 1,238.9 3,320.9
Pennsylvania 48.8 43.3 78.0 68.4 56.2 119.6 41.1 154.0 107.9 149.4 128.0 305.6 540.9 644.9 1,763.5 2,911.7
Illinois 43.5 30.7 38.5 42.7 93.4 72.0 96.6 73.9 89.5 168.9 199.0 358.0 414.3 426.9 1,232.7 2,382.3
Colorado 77.0 113.8 111.4 107.8 157.8 93.7 54.2 129.7 135.0 197.4 325.1 321.2 405.0 838.9 1,832.9 4,091.9
Florida 31.1 34.5 70.8 80.0 44.3 34.6 22.5 71.9 127.7 102.8 270.9 398.9 467.1 625.3 1,697.4 2,691.1
Georgia 55.8 111.4 66.6 105.3 64.7 20.9 46.8 192.7 143.4 93.5 157.8 247.1 371.9 504.5 1,164.1 2,270.7
New Jersey 75.3 116.9 132.3 99.1 156.6 66.5 68.7 106.1 100.2 190.7 241.6 441.8 490.9 501.2 907.8 3,162.9
Ohio 34.7 55.7 44.8 53.4 32.7 27.9 19.6 27.1 34.3 67.3 68.7 160.5 180.9 319.1 421.0 1,013.6
Utah 6.0 32.8 8.3 11.9 4.4 1.0 9.1 24.4 7.3 1.2 23.2 57.5 90.7 116.2 418.4 666.9
D. of Columbia 18.9 15.2 4.7 17.2 0.0 2.5 0.8 4.8 1.1 4.3 0.8 6.7 5.2 46.9 539.7 508.3
Minnesota 24.4 29.9 35.4 25.8 37.6 78.7 38.7 52.0 37.1 55.4 192.3 149.9 256.8 340.0 616.5 951.7
North Carolina 17.3 20.9 21.0 15.7 26.1 36.9 12.1 48.8 22.2 63.6 210.7 180.9 271.8 326.9 853.6 1,821.8
Connecticut 71.6 76.9 101.3 167.7 89.6 134.9 86.5 57.8 33.3 82.5 141.3 146.0 270.0 345.2 889.2 1,550.8
Oregon 84.9 75.0 51.7 66.7 43.2 33.0 29.7 55.6 32.8 27.0 38.6 90.5 126.9 53.5 501.0 810.4
Arizona 15.2 38.1 38.6 43.9 37.8 27.5 33.3 64.9 41.9 35.7 83.4 95.5 170.2 226.1 365.5 668.6
Tennessee 43.5 53.5 74.5 42.7 73.8 38.8 21.1 7.2 46.7 40.6 157.7 178.2 106.6 107.3 581.0 466.3
Michigan 34.8 21.3 59.1 15.7 21.8 26.4 5.7 14.9 58.7 8.6 65.7 79.4 106.2 122.4 253.5 356.4
South Carolina 0.9 - 15.3 18.1 23.7 7.6 4.0 1.2 11.4 21.8 53.1 100.2 61.0 168.0 218.2 415.2
Arkansas - 1.2 - - - - - 1.0 - - 5.0 - 4.0 29.9 25.9 34.3
Rhode Island 12.6 9.9 6.6 14.2 30.9 2.7 0.4 5.1 10.5 - 3.5 20.3 11.5 26.0 35.4 92.6
Missouri 8.8 4.3 11.1 1.6 9.4 7.5 34.9 25.2 55.1 70.5 98.5 56.1 72.6 611.7 309.1 655.8
New Hampshire 5.3 14.8 15.1 27.7 29.5 16.2 29.2 6.8 31.7 7.9 30.5 42.9 53.3 167.8 233.8 767.9
Delaware 0.3 - 4.5 1.4 4.8 2.3 3.8 9.9 3.0 12.5 4.4 4.7 1.1 - 16.8 134.7
Wisconsin 11.4 13.6 16.4 12.8 11.7 10.9 5.5 23.3 32.5 8.5 9.1 26.0 62.9 51.3 88.5 259.7
Kansas 2.3 2.2 3.9 4.6 5.1 8.9 0.4 1.7 4.8 1.5 8.7 35.7 9.2 10.4 30.2 264.8
Maine 19.0 11.6 15.3 8.7 17.2 5.1 4.3 0.5 3.0 - 1.5 1.5 3.7 59.7 44.9 140.2
New Mexico 18.9 9.2 6.6 3.9 3.0 1.8 4.4 - 0.5 - 3.6 12.9 32.5 7.7 12.1 21.1
Indiana 16.0 16.7 17.7 6.4 10.1 10.5 8.3 0.0 16.6 56.3 15.2 20.8 29.7 44.0 46.7 273.3
North Dakota - - 14.0 - - - - - - 0.2 9.8 - 1.1 0.5 3.0 6.1
Iowa 0.7 0.9 7.8 1.3 2.0 2.5 0.7 1.6 2.0 19.8 12.1 22.1 17.1 8.8 3.9 16.4
Vermont - 6.6 8.0 4.5 7.4 7.2 1.3 3.8 - 5.3 13.0 1.8 4.5 4.2 - 46.4
Louisiana 9.9 3.3 1.9 1.9 - - 2.3 3.8 3.8 2.7 25.5 13.7 26.5 41.0 234.0 103.3
South Dakota - - - - - - - - - - - - - - 0.7 0.3
Nebraska 0.5 - - 1.5 - - - 0.1 38.0 3.5 0.5 10.4 3.7 29.1 57.3 163.1
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000
Kentucky 2.4 2.3 7.4 2.8 5.8 - 8.5 3.9 15.4 11.9 21.6 31.1 35.0 37.5 81.9 201.8
Nevada - 2.4 4.1 - 5.5 0.1 2.2 9.1 - 1.2 2.9 18.7 9.7 61.2 47.1 30.9
Oklahoma 1.5 4.7 14.1 5.3 9.3 2.6 1.5 - - 11.0 6.1 31.8 27.8 115.4 70.0 44.5
Idaho 0.3 - - - - - - 5.0 0.2 0.1 15.2 0.1 1.2 30.3 16.5 8.5
Alabama 15.5 17.3 21.3 9.6 2.0 2.3 0.3 10.6 55.1 25.0 28.5 50.2 109.9 58.3 65.9 278.5
Hawaii - - - - - - - - - - - 20.5 1.5 4.2 12.8 203.0
Mississippi 2.2 0.0 - 0.6 0.9 4.9 2.4 14.5 1.7 15.0 - 10.6 8.4 4.5 250.7 23.5
West Virginia 1.1 2.0 0.1 0.0 - 0.1 - - 0.0 - - - 23.8 2.0 - 4.5
Montana 1.6 1.7 3.3 1.1 - - 1.0 - - - - - - - 16.3 16.7
Alaska - - - - - - - - - - - - - - - 3.5
Puerto Rico - - - - - - 0.3 0.0 1.0 22.0 7.8 8.2 12.5 1.3 4.6 42.1
Unknown - - 0.5 0.8 6.1 13.0 0.2 30.8 0.8 0.1 0.3 2.2 4.4 39.1 2.4 50.4
Wyoming - 0.1 - - - - - - - - - - 2.0 - - -
Total 2,779.0 3,132.3 3,361.3 3,411.3 3,333.0 2,833.1 2,259.7 3,594.2 3,663.2 4,130.1 8,014.8 11,341.6 15,004.6 21,473.0 54,846.7 105,104.6
Figure 3.16b
State 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
California 16,665.4 9,598.7 8,693.9 10,577.2 10,881.4 12,965.9 15,463.7 14,873.4 10,302.7 12,021.7 15,109.7 14,541.6 14,769.7
Massachusetts 4,919.4 2,646.3 2,721.3 3,107.9 2,736.6 3,032.0 3,798.9 3,328.7 2,407.8 2,422.6 3,152.7 3,222.1 3,079.3
New York 1,935.1 746.3 669.8 773.7 1,068.9 1,444.6 1,350.0 1,538.6 1,080.4 1,391.8 2,474.8 1,899.3 2,870.4
Texas 3,137.3 1,191.6 1,221.0 1,212.3 1,170.7 1,518.2 1,493.8 1,127.7 678.2 1,079.4 1,622.4 948.9 1,315.5
Washington 1,150.7 591.0 450.8 854.9 830.3 1,116.9 1,335.2 883.5 565.2 575.8 539.2 853.1 913.2
Maryland 935.6 627.1 331.4 709.5 637.8 844.2 728.9 578.0 424.0 484.2 438.4 407.8 664.5
Virginia 1,004.2 429.0 397.3 291.1 534.8 460.9 626.4 534.6 209.4 376.7 520.1 273.6 593.8
Pennsylvania 1,084.2 526.5 537.6 624.9 518.3 898.7 977.3 787.0 433.6 525.4 515.6 524.4 446.5
Illinois 998.6 313.6 379.9 236.6 315.7 437.2 451.4 477.0 257.1 654.3 799.5 594.4 434.9
Colorado 1,244.4 588.0 609.9 363.2 622.9 703.3 686.3 872.3 458.9 445.9 619.7 589.0 428.8
Florida 937.3 401.7 323.2 422.6 329.2 282.0 599.3 265.2 337.7 234.2 335.5 203.9 421.0
Georgia 847.9 574.9 281.5 500.5 264.4 414.1 431.6 420.9 310.6 334.0 381.3 262.8 411.8
New Jersey 1,542.3 972.0 802.8 968.1 925.4 740.7 578.9 716.0 621.8 460.8 439.6 421.4 322.3
Ohio 249.2 266.0 193.9 89.9 136.5 91.2 228.1 273.6 122.7 199.4 188.1 304.5 319.2
Utah 220.1 135.7 111.8 249.8 248.8 198.1 196.0 254.8 176.3 150.5 249.3 318.4 315.0
D. of Columbia 161.8 23.5 56.1 80.2 25.1 46.2 57.7 25.3 49.1 109.3 53.4 60.8 286.5
Minnesota 475.2 345.5 208.2 388.2 274.0 304.5 413.1 485.0 284.8 145.1 291.4 254.1 270.0
North Carolina 585.6 554.2 379.4 311.1 346.9 422.5 555.4 511.6 254.9 421.6 303.6 180.9 259.6
Connecticut 608.2 191.9 223.6 251.6 209.6 289.0 271.0 236.1 190.2 133.2 157.8 152.6 181.7
Oregon 248.6 165.1 140.5 142.4 132.2 146.8 254.4 152.2 79.6 133.4 237.8 124.6 138.5
Arizona 247.5 212.4 81.9 72.2 134.7 276.7 238.2 228.5 94.0 84.2 230.4 237.4 113.3
Figure 3.16b
State 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Tennessee 193.3 122.5 82.6 96.2 101.5 43.2 126.7 84.3 75.0 69.3 108.6 81.3 109.3
Michigan 154.9 109.4 95.2 134.3 93.3 131.3 104.7 214.5 178.5 148.9 83.1 238.9 108.2
South Carolina 10.1 45.3 11.8 13.6 2.7 8.3 86.9 21.2 7.1 41.6 59.7 39.5 85.7
Arkansas 10.4 9.7 1.2 3.7 5.1 6.5 6.2 - - 5.0 - 5.0 85.5
Rhode Island 118.7 95.9 62.8 58.0 72.8 77.2 4.5 16.1 30.0 59.3 42.2 85.1 81.7
Missouri 267.4 81.0 79.5 26.0 127.7 57.8 47.6 92.5 17.4 97.0 134.4 21.5 76.7
New Hampshire 257.9 225.7 167.1 127.6 97.2 123.1 154.1 255.8 52.1 56.9 62.5 60.7 74.4
Delaware 14.6 19.4 0.4 2.1 11.1 5.3 7.3 79.0 20.6 32.2 26.2 9.6 70.8
Wisconsin 92.6 51.2 37.6 66.0 67.8 72.0 87.2 71.6 36.1 134.9 52.9 95.3 35.9
Kansas 40.3 8.9 27.0 48.7 7.2 31.5 123.4 59.5 7.5 39.1 53.8 47.6 32.9
Maine 3.9 16.9 2.7 26.0 5.1 39.9 7.8 5.4 11.4 4.3 38.6 12.8 26.8
New Mexico 14.2 13.9 3.6 24.0 76.4 32.1 131.1 49.8 5.5 12.4 64.9 36.3 25.9
Indiana 56.5 40.1 24.5 67.8 123.7 32.8 70.6 93.7 232.1 80.0 177.9 84.2 25.4
North Dakota 1.0 - 14.5 2.0 - - 0.2 5.5 4.7 3.2 4.0 2.4 24.1
Iowa 9.1 2.0 - 5.3 12.1 1.5 25.3 58.2 84.1 51.5 28.4 5.0 22.5
Vermont 11.6 1.2 0.5 4.5 34.8 24.1 17.6 42.2 47.1 33.1 24.8 4.4 21.4
Louisiana 46.0 17.7 2.3 9.6 3.0 11.4 15.1 14.6 13.3 18.1 21.2 9.4 14.8
South Dakota 1.6 18.1 3.5 2.2 - - 4.0 0.5 0.8 - 4.1 - 11.9
Nebraska 90.1 16.9 4.6 0.2 13.1 7.5 2.9 11.8 - 2.0 - 3.1 11.0
Kentucky 88.9 13.8 5.4 48.2 35.0 28.2 56.9 32.8 17.3 16.7 12.5 23.5 10.8
Nevada 33.3 31.8 23.2 47.6 64.9 19.6 23.7 12.6 15.4 28.8 27.0 8.3 9.6
Oklahoma 13.8 33.0 35.1 68.1 80.8 14.9 8.1 17.3 4.5 13.0 27.1 34.0 8.0
Idaho 2.7 10.6 52.2 2.5 10.0 17.8 18.7 22.8 14.6 7.8 5.1 15.2 6.5
Alabama 80.3 65.1 35.7 69.2 39.7 19.9 36.1 48.8 45.4 0.6 3.5 23.1 5.2
Hawaii 37.8 4.4 17.8 13.7 14.6 32.8 4.9 7.5 7.4 9.5 0.6 0.6 2.5
Mississippi 30.0 5.0 0.9 4.9 10.0 16.2 5.0 - 1.3 - 1.0 9.8 1.2
West Virginia 1.4 15.9 12.6 5.8 10.5 4.9 10.8 30.0 3.0 3.8 2.1 14.6 1.2
Montana 24.8 - - - 27.4 - 4.0 15.6 14.5 1.9 3.2 5.6 0.0
Alaska - - - - - - - - - - - - -
Puerto Rico 32.0 0.5 0.1 1.5 28.8 14.3 16.0 13.8 - 4.5 - 0.1 -
Unknown 14.3 - - - - - - - 0.5 - - - -
Wyoming - - - 1.5 4.1 6.5 0.2 1.5 - 10.0 - - -
Total 40,952.1 22,177.1 19,620.0 23,208.8 23,524.5 27,514.5 31,942.9 29,948.9 20,286.2 23,368.6 29,730.0 27,352.3 29,545.2
Figure 3.17
Venture Capital Investments 1985-2013 By State (Number of Deals)
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
California 467 493 523 534 569 552 478 575 435 460 685 1,023 1,142 1,402 2,223 2,946 1,539 1,104 1,164 1,262
New York 45 47 63 48 49 31 24 38 37 38 74 89 156 195 353 609 293 155 120 158
Massachusetts 215 187 224 195 182 172 136 135 131 127 197 289 334 398 591 791 518 388 384 385
Pennsylvania 35 45 59 54 41 44 37 61 44 38 64 85 139 149 153 261 155 109 106 113
Texas 106 93 106 105 91 85 70 70 72 68 101 135 172 197 318 485 343 174 174 176
Washington 20 21 29 30 37 26 26 37 32 36 66 83 89 111 207 258 146 111 80 114
Illinois 26 27 31 31 61 34 44 40 25 35 44 55 87 73 118 203 128 81 59 62
Ohio 26 21 26 21 18 21 20 21 20 20 36 56 53 66 52 82 45 51 32 37
Colorado 43 58 62 63 53 49 35 53 48 53 58 83 98 127 161 222 115 91 71 72
Michigan 20 24 25 12 16 15 9 6 12 3 12 21 28 29 44 55 22 27 18 17
Maryland 18 17 24 28 19 29 27 25 18 22 32 49 49 58 100 178 92 91 86 98
Virginia 22 22 31 26 30 27 24 20 20 21 39 59 82 99 154 284 145 92 86 78
Connecticut 33 33 41 46 48 41 36 33 26 35 43 45 66 73 96 123 78 41 37 38
North Carolina 14 21 15 11 18 28 20 20 22 20 36 60 80 82 104 153 88 79 76 56
Tennessee 16 22 28 31 27 22 24 11 8 12 21 29 25 24 47 51 30 25 24 27
Florida 21 20 29 23 22 32 19 25 26 19 61 57 74 70 117 189 113 64 66 64
New Jersey 45 43 54 42 55 44 48 44 37 39 56 68 85 83 118 188 156 96 85 94
Georgia 31 44 45 42 33 34 35 37 42 46 50 54 79 98 161 224 138 81 65 79
Minnesota 23 31 34 28 30 32 31 25 24 20 50 47 89 77 84 107 88 59 57 52
Missouri 5 7 13 8 11 11 9 9 13 8 19 26 18 23 29 54 18 29 19 9
Oregon 24 24 30 34 27 22 12 12 15 13 17 28 41 18 52 67 42 28 23 31
Utah 3 14 15 7 6 4 9 8 7 1 6 16 31 35 43 58 44 29 24 31
D. of Columbia 4 6 8 4 2 5 3 3 2 4 1 5 2 4 18 45 22 7 6 8
Arizona 15 11 20 13 24 14 15 22 21 25 27 30 29 38 57 70 35 27 19 12
Wisconsin 13 16 17 15 6 10 6 9 8 9 8 11 19 16 19 27 20 11 8 14
New Hampshire 3 9 11 10 13 18 17 10 10 4 10 17 17 24 31 60 39 41 34 22
New Mexico 2 3 5 5 1 3 2 - 2 1 2 5 4 4 6 8 4 6 5 8
Indiana 9 15 15 6 6 12 8 1 7 7 8 9 13 9 11 28 7 12 8 10
South Carolina 1 - 5 3 7 5 10 7 7 6 5 15 15 17 10 11 4 4 3 5
Rhode Island 6 4 7 6 7 7 4 2 3 - 3 2 4 5 11 11 11 14 10 8
Kansas 1 2 6 3 3 3 1 3 2 2 4 11 6 3 8 22 10 8 13 13
Vermont - 3 3 3 2 3 3 1 - 3 5 3 3 3 1 4 3 4 3 3
Nebraska 1 - - 5 1 - - 1 5 3 1 5 3 6 7 11 10 3 2 2
Oklahoma 4 5 4 1 4 2 1 - - 5 2 7 5 12 8 9 5 4 3 12
Louisiana 6 2 2 2 - - 2 1 4 2 7 4 12 9 9 14 10 7 2 4
Kentucky 2 4 7 4 5 - 2 2 2 3 9 7 15 16 16 14 5 3 3 6
Alabama 7 10 12 4 7 7 2 4 10 4 9 8 17 14 10 30 15 12 10 8
Delaware 1 1 1 4 3 5 4 3 1 3 4 4 4 - 3 5 1 2 1 1
Nevada - 2 2 - 1 1 4 4 - 2 2 4 7 11 10 10 6 6 7 7
Arkansas - 1 - - - - - 1 - - 2 - 2 3 5 5 3 5 3 2
Figure 3.17b
State 2005 2006 2007 2008 2009 2010 2011 2012 2013
California 1,337 1,592 1,735 1,699 1,297 1,478 1,622 1,604 1,616
New York 131 235 221 265 203 292 355 343 403
Massachusetts 392 409 475 452 343 378 402 426 364
Pennsylvania 107 149 176 193 136 163 156 190 233
Texas 181 201 188 162 126 168 172 163 154
Washington 122 142 168 159 107 116 122 114 126
Illinois 60 65 70 74 52 76 103 83 93
Ohio 38 46 69 68 60 64 74 61 86
Colorado 91 112 114 116 91 84 109 105 81
Michigan 21 24 22 45 36 31 35 49 72
Maryland 115 111 100 108 80 76 76 57 71
Virginia 91 94 103 88 49 58 77 79 67
Connecticut 34 30 36 41 42 62 57 50 52
North Carolina 48 58 70 58 39 57 47 34 50
Tennessee 25 14 23 27 17 31 41 33 50
Florida 52 57 60 43 35 45 55 35 47
New Jersey 81 93 100 92 77 70 63 58 43
Georgia 64 91 73 82 47 70 59 55 41
Minnesota 42 46 61 52 39 31 49 32 39
Missouri 11 14 18 25 12 15 22 12 38
Oregon 28 33 39 33 16 32 38 30 38
Utah 32 42 38 40 34 27 48 44 34
D. of Columbia 10 9 13 12 7 16 12 27 33
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Maine 8 6 5 4 6 6 4 1 2 - 2 5 2 14 11 15 9 6 3 4
Hawaii 1 - - - - - - - - - - 3 4 3 3 3 5 2 7 5
Mississippi 1 1 - 1 1 3 1 4 2 5 - 3 4 3 5 6 3 3 3 5
North Dakota - - 1 - - - - - - 1 2 - 1 1 1 1 1 - 2 1
Idaho 1 - 1 - - - - 1 2 1 1 1 2 3 2 3 2 2 5 2
Iowa 1 3 2 3 2 2 3 4 1 4 9 6 4 7 2 4 5 1 1 4
Montana 2 3 2 6 - - 3 - - - - - - - 2 3 2 - - -
South Dakota - - - - - - - - - - - - - - 1 1 2 2 1 4
West Virginia 1 1 2 1 - 1 - - 1 - - - 2 1 - 2 2 8 5 3
Alaska - - - - - - - 1 - - - - - - - 1 - - - -
Puerto Rico - - - - - - 3 2 1 2 4 6 2 2 2 11 5 1 1 1
Unknown - - 1 2 3 1 1 2 4 2 2 7 7 14 3 16 8 - - -
Wyoming - 1 - - - - - - - - - - 2 - - - - - - 1
Total 1,348 1,423 1,646 1,524 1,547 1,463 1,272 1,394 1,211 1,232 1,896 2,635 3,224 3,729 5,597 8,038 4,590 3,206 3,024 3,228
Figure 3.17b
Venture Capital Investments 1985-2013
By State (Number of Deals)
State 2005 2006 2007 2008 2009 2010 2011 2012 2013
Arizona 28 34 34 22 20 18 23 19 25
Wisconsin 18 20 22 20 15 23 14 14 19
New Hampshire 21 22 25 30 14 10 15 8 17
New Mexico 16 9 27 18 13 11 10 16 17
Indiana 13 14 17 14 15 16 14 17 15
South Carolina 1 2 10 10 5 10 4 5 15
Rhode Island 12 7 3 6 15 11 14 15 13
Kansas 5 10 16 25 17 35 47 12 10
Vermont 4 8 7 8 8 7 8 5 10
Nebraska 3 4 4 2 - 2 1 4 9
Oklahoma 1 8 6 5 4 2 4 7 8
Louisiana 3 2 7 11 12 4 8 3 7
Kentucky 4 10 10 10 9 15 9 7 6
Alabama 6 9 10 10 11 2 2 6 5
Delaware 5 4 5 9 6 9 10 7 5
Nevada 8 7 8 6 4 4 4 5 5
Arkansas 2 6 2 - - 1 - 1 4
Maine 3 7 8 4 4 7 5 6 4
Hawaii 6 11 6 7 3 3 3 3 3
Mississippi 2 4 1 - 4 - 1 4 3
North Dakota - - 1 4 3 1 1 1 3
Idaho 3 5 7 6 4 4 3 4 2
Iowa 3 2 3 8 9 2 3 1 2
Montana 2 1 1 2 1 3 2 6 1
South Dakota - 1 3 1 3 - 2 1 1
West Virginia 5 4 5 2 3 4 2 3 1
Alaska - - - - - - - - -
Puerto Rico 2 3 4 2 - 1 - 1 -
Unknown - - - - 1 1 1 - -
Wyoming 4 1 2 1 - 1 - - -
Total 3,293 3,882 4,226 4,177 3,148 3,647 4,004 3,865 4,041
0
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Follow-on
First
Figure 3.18
First vs. Follow-on Deals
Total Dollars Invested ($ Millions)
Figure 3.19
First vs. Follow-on
Year First Follow-on Total
1985 727.3 2,051.7 2,779.0
1986 905.3 2,226.9 3,132.3
1987 1,008.4 2,352.9 3,361.3
1988 1,098.4 2,312.9 3,411.3
1989 907.4 2,425.6 3,333.0
1990 847.2 1,985.9 2,833.1
1991 551.7 1,707.9 2,259.7
1992 1,302.5 2,291.7 3,594.2
1993 1,274.8 2,388.4 3,663.2
1994 1,644.6 2,485.5 4,130.1
1995 3,976.7 4,038.0 8,014.8
1996 4,198.9 7,142.7 11,341.6
1997 4,869.1 10,135.5 15,004.6
1998 7,154.7 14,318.3 21,473.0
1999 16,333.3 38,513.4 54,846.7
2000 28,542.8 76,561.8 105,104.6
2001 7,300.7 33,651.4 40,952.1
2002 4,343.6 17,833.5 22,177.1
2003 3,692.1 15,927.9 19,620.0
2004 5,402.7 17,806.1 23,208.8
2005 5,885.4 17,639.1 23,524.5
2006 6,266.8 21,247.7 27,514.5
2007 7,721.4 24,221.5 31,942.9
2008 6,515.5 23,433.3 29,948.9
2009 3,506.0 16,780.2 20,286.2
2010 4,294.3 19,074.3 23,368.6
2011 5,498.2 24,231.8 29,730.0
2012 4,440.6 22,911.7 27,352.3
2013 5,104.7 24,440.5 29,545.2
0
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Figure 3.20
Number of Companies Receiving
Figure 3.21
First vs Follow-on
Year
No. of Cos
Receiving
Initial Deals
Financing
No. of Cos
Receiving
Follow-On
Financing
No. of Cos
Receiving
Financing*
1985 435 757 1,156
1986 507 760 1,228
1987 580 865 1,387
1988 510 801 1,262
1989 450 841 1,241
1990 351 788 1,072
1991 266 717 941
1992 394 716 1,047
1993 354 652 949
1994 428 626 989
1995 902 776 1,573
1996 1,145 1,170 2,116
1997 1,305 1,473 2,575
1998 1,430 1,831 3,030
1999 2,468 2,440 4,474
2000 3,391 3,692 6,423
2001 1,233 2,785 3,854
2002 847 1,977 2,713
2003 777 1,834 2,511
2004 975 1,847 2,715
2005 1,075 1,852 2,800
2006 1,277 2,128 3,229
2007 1,419 2,255 3,502
2008 1,309 2,348 3,479
2009 830 1,903 2,645
2010 1,091 2,052 3,022
2011 1,346 2,178 3,356
2012 1,275 2,148 3,269
2013 1,334 2,221 3,383
* No. of Cos receiving nancing can be less than the sum
of the rst two columns because any given company can
receive initial and follow-on nancing in the same year
Figure 3.22
First Sequence by Stage of Development ($ Millions)
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Seed 309.0 437.6 353.4 377.9 258.3 178.2 102.7 214.3 356.5 528.1 742.6 639.1 798.3 1,003.4 2,790.6
Early Stage 101.4 88.8 318.5 291.8 215.7 292.6 214.3 266.5 260.1 390.8 898.0 1,356.4 1,722.4 2,700.2 6,367.9
Expansion 65.8 211.4 272.0 321.8 312.4 277.3 153.3 572.5 490.2 471.0 1,641.9 1,742.4 1,866.5 2,815.0 5,840.2
Later Stage 51.1 67.5 64.4 106.9 121.0 99.1 81.4 249.1 168.0 254.8 694.2 460.9 481.9 636.1 1,334.5
Total 727.3 905.3 1,008.4 1,098.4 907.4 847.2 551.7 1,302.5 1,274.8 1,644.6 3,976.7 4,198.9 4,869.1 7,154.7 16,333.3
First Sequence by Stage of Development ($ Millions)
Stage 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Seed 2,522.9 632.4 266.8 302.9 793.6 803.0 1,081.6 1,410.7 1,368.5 878.3 899.2 823.9 558.4 750.2
Early Stage 16,420.1 4,411.0 2,359.3 2,121.4 2,605.1 2,616.9 2,522.1 2,917.8 2,381.0 1,346.1 1,748.5 2,645.7 2,244.3 2,920.4
Expansion 8,673.1 1,891.8 1,333.1 953.4 1,292.3 1,572.6 1,923.0 2,477.3 1,698.1 786.3 946.6 1,047.6 945.7 789.1
Later Stage 926.8 365.4 384.4 314.5 711.6 892.9 740.1 915.5 1,068.0 495.3 700.0 981.0 692.2 644.9
Total 28,542.8 7,300.7 4,343.6 3,692.1 5,402.7 5,885.4 6,266.8 7,721.4 6,515.5 3,506.0 4,294.3 5,498.2 4,440.6 5,104.7
Figure 3.23
First Sequence by Stage of Development (Number of Deals)
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Seed 221 247 230 210 206 119 88 119 145 189 256 309 347 459 661
Early Stage 81 118 199 168 102 122 78 132 70 111 281 401 470 495 1116
Expansion 107 105 118 106 111 86 79 115 105 104 293 360 419 411 626
Later Stage 26 37 33 26 31 24 21 28 34 24 72 75 69 65 65
Total 435 507 580 510 450 351 266 394 354 428 902 1,145 1,305 1,430 2,468
First Sequence by Stage of Development (Number of Deals)
Stage 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Seed 587 221 130 165 178 210 324 426 381 224 281 356 213 177
Early Stage 1913 691 465 424 539 539 570 592 557 387 548 701 827 930
Expansion 799 279 199 142 183 252 275 295 228 142 169 177 149 150
Later Stage 92 42 53 46 75 74 108 106 143 77 93 112 86 77
Total 3,391 1,233 847 777 975 1,075 1,277 1,419 1,309 830 1,091 1,346 1,275 1,334
Figure 3.24
First Sequence by Industry ($ Millions)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Software 97.8 110.6 94.6 130.1 94.3 167.9 106.8 149.8 123.0 296.0 542.1 923.8 1,060.5 1,375.8 2,980.7
Biotechnology 34.5 54.3 66.0 66.9 54.8 26.1 16.1 181.1 123.0 161.1 159.3 212.8 346.3 383.7 417.9
Media and Entertainment 69.8 43.2 100.3 114.1 80.4 63.7 13.9 81.3 195.6 115.3 775.1 364.3 419.3 686.4 2,466.9
IT Services 15.3 16.6 5.5 12.8 20.6 18.3 10.3 8.9 36.0 93.0 44.9 312.9 231.3 377.1 1,545.9
Medical Devices and Equipment 44.4 75.0 85.0 84.8 74.3 59.6 45.9 127.2 117.2 123.9 188.4 212.6 260.1 263.0 310.4
Healthcare Services 16.5 70.2 56.4 17.1 48.8 31.5 31.7 66.6 92.5 109.5 300.4 273.9 342.5 239.2 368.5
Consumer Products and Services 46.8 63.9 57.9 77.0 31.1 88.4 53.8 76.9 74.8 113.2 306.6 206.5 195.1 257.8 835.8
Financial Services 61.1 75.6 43.9 165.9 71.4 35.3 8.3 100.6 78.9 62.9 114.0 253.2 253.2 443.6 765.0
Industrial/Energy 93.6 81.3 114.5 123.5 222.5 108.0 68.2 148.9 150.2 156.4 434.1 274.5 352.3 782.4 708.2
Other 0.5 2.0 - 6.0 - 0.0 32.7 0.0 - 0.2 13.0 0.5 15.3 26.8 92.3
Computers and Peripherals 39.0 69.0 87.0 70.5 46.3 52.4 19.1 59.9 35.1 48.5 148.1 115.2 110.2 122.5 273.5
Business Products and Services 12.3 49.7 26.6 11.3 13.3 37.7 63.7 28.1 61.9 24.3 135.7 159.3 267.6 367.0 963.1
Telecommunications 64.2 45.0 38.6 30.9 44.2 53.6 10.8 93.5 64.2 192.8 365.2 416.4 387.1 955.6 1,960.1
Retailing/Distribution 19.7 64.6 137.8 63.3 22.4 13.2 25.1 52.7 28.4 60.5 217.7 131.0 114.2 335.3 698.7
Electronics/Instrumentation 42.1 27.6 31.9 25.7 12.7 14.7 15.1 14.2 16.0 6.6 67.1 85.7 123.8 47.5 79.2
Unknown - - - - - - - - - - - - - - -
Semiconductors 47.5 22.4 38.9 56.7 14.5 36.3 10.2 51.7 5.1 42.9 69.5 130.5 166.2 165.0 292.2
Networking and Equipment 22.2 34.1 23.5 41.8 55.9 40.4 19.9 61.0 73.0 37.7 95.5 125.7 224.3 325.9 1,574.8
Total 727.3 905.3 1,008.4 1,098.4 907.4 847.2 551.7 1,302.5 1,274.8 1,644.6 3,976.7 4,198.9 4,869.1 7,154.7 16,333.3
Figure 3.24
First Sequence by Industry ($ Millions)
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Software 6,120.9 1,649.4 1,270.5 936.3 1,236.5 1,170.4 1,320.9 1,492.4 1,184.3 817.8 1,006.2 1,687.9 1,883.0 2,279.1
Biotechnology 807.9 804.2 698.8 423.7 724.5 622.6 1,098.4 1,070.4 955.7 472.8 613.6 891.3 465.7 818.0
Media and Entertainment 2,848.6 344.6 208.5 223.3 680.5 525.5 649.4 652.7 495.6 247.8 378.1 568.1 518.4 433.9
IT Services 2,616.3 310.4 129.0 143.2 198.8 338.6 342.4 517.1 632.7 298.7 444.2 494.2 277.7 371.1
Medical Devices and Equipment 339.5 281.8 279.3 309.7 333.4 389.4 548.6 776.2 682.9 321.7 245.9 244.4 223.2 207.3
Healthcare Services 428.0 84.4 155.1 70.5 87.5 144.7 78.7 76.2 28.7 59.5 148.7 91.2 112.3 181.1
Consumer Products and Services 954.3 131.6 44.9 78.0 123.7 225.7 130.5 205.9 193.4 125.0 193.2 351.6 199.8 177.3
Financial Services 1,484.8 297.5 76.3 94.4 249.2 646.1 164.9 326.1 245.9 132.0 149.9 50.5 29.0 142.0
Industrial/Energy 1,106.8 472.8 433.0 251.0 308.9 525.3 698.0 1,262.0 1,218.3 584.9 443.9 597.0 264.4 127.9
Other 37.0 36.6 17.0 - 13.6 0.1 - 2.7 - 3.5 2.0 12.4 25.2 85.9
Computers and Peripherals 346.8 259.8 17.2 85.0 91.1 84.4 55.7 101.4 129.4 62.2 50.9 99.3 27.4 67.9
Business Products and Services 1,907.7 277.1 117.3 342.6 235.8 152.0 208.3 239.6 97.5 122.8 81.9 49.7 40.2 66.7
Telecommunications 4,755.3 796.6 189.5 180.6 285.9 342.0 410.0 423.4 304.1 84.2 158.2 71.1 136.4 55.3
Retailing/Distribution 869.8 59.1 34.7 12.4 118.3 135.9 39.9 84.5 34.6 21.5 56.1 79.0 43.0 25.0
Electronics/Instrumentation 144.1 103.3 82.3 45.4 98.8 130.1 134.9 114.2 65.7 37.9 66.2 30.0 70.6 23.8
Unknown - - - - - - - - - - - - - 19.7
Semiconductors 1,145.2 514.9 344.7 375.4 417.6 281.5 260.5 212.9 196.0 69.0 110.0 99.6 91.0 19.6
Networking and Equipment 2,629.8 876.5 245.4 120.5 198.4 171.2 125.6 163.7 50.7 44.6 145.3 80.8 33.2 3.0
Total 28,542.8 7,300.7 4,343.6 3,692.1 5,402.7 5,885.4 6,266.8 7,721.4 6,515.5 3,506.0 4,294.3 5,498.2 4,440.6 5,104.7
Figure 3.25
First Sequence by Industry (Number of Deals)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Software 73 73 83 87 68 83 61 66 51 97 223 327 330 335 596
IT Services 11 9 6 9 11 7 5 5 8 20 28 67 62 90 230
Biotechnology 28 32 57 47 37 26 21 54 45 42 54 69 85 106 81
Consumer Products and Services 26 30 33 18 23 26 18 21 19 28 55 52 71 69 139
Medical Devices and Equipment 40 53 61 57 61 36 28 45 41 36 55 85 109 96 87
Business Products and Services 12 27 22 13 9 8 9 10 17 10 32 39 50 74 146
Semiconductors 25 13 17 21 13 14 7 11 6 12 25 29 54 43 51
Other 1 1 - 1 - 2 2 2 1 1 6 1 5 5 10
Total 435 507 580 510 450 351 266 394 354 428 902 1,145 1,305 1,430 2,468
First Sequence by Industry (Number of Deals)
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Software 877 315 269 232 249 285 300 329 319 228 338 469 517 591
IT Services 327 75 26 32 51 67 90 99 117 73 99 140 98 124
Biotechnology 123 109 115 91 110 121 149 149 149 93 117 113 87 100
Consumer Products and Services 100 29 24 20 30 41 43 58 52 32 41 58 81 79
Medical Devices and Equipment 70 63 63 77 80 84 126 123 108 79 70 71 61 55
Business Products and Services 223 52 25 29 37 36 40 55 47 26 29 29 16 34
Semiconductors 116 76 53 65 79 43 47 41 35 15 15 21 15 11
Other 9 8 2 1 6 3 - 9 3 5 9 8 12 18
Total 3,391 1,233 847 777 975 1,075 1,277 1,419 1,309 830 1,091 1,346 1,275 1,334
Figure 3.26
Internet-Related Investments By Year
Year # Companies ($ Millions)
1995 433 1,946.0
1996 763 4,236.4
1997 1,030 6,375.9
1998 1,492 11,875.9
1999 3,069 42,540.5
2000 4,615 80,915.1
2001 2,391 26,620.0
2002 1,473 11,394.5
2003 1,255 9,343.2
2004 1,278 10,991.5
2005 1,367 11,002.1
2006 1,680 13,007.0
2007 1,805 14,959.7
2008 1,860 13,444.9
2009 1,450 9,434.3
2010 1,725 11,061.2
2011 2,136 15,949.3
2012 2,170 16,067.8
2013 2,281 19,009.3
Total 15,177 330,174.5
Figure 3.27
Top 5 States by Internet-Related
Investments
State ($ Millions)
California 10,056.9
New York 2,320.1
Massachusetts 1,253.5
Texas 882.1
Washington 624.6
Total* 15,137.2
*Total includes above 5 states only
Figure 3.28 Internet-Related
Investments by Region in 2013
Stage Region ($ Millions)
Silicon Valley 8,735.3
NY Metro 2,406.6
New England 1,358.8
LA/Orange County 1,132.9
DC/Metroplex 911.2
Texas 882.1
Southeast 873.3
Northwest 742.3
Midwest 655.1
SouthWest 329.8
Colorado 259.2
Philadelphia Metro 211.5
North Central 166.9
San Diego 164.8
South Central 127.0
Upstate NY 28.6
Sacramento/N.Cal 23.9
Total 19,009.3
Figure 3.29
Sources and Targets of Invested Capital Investments 2013 ($ Millions)
SOURCE
STATE AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IND KS KY LA MA MD ME MI
AL 0.0 1.3 0.0 0.0 0.7 0.0 0.0 1.7 0.0 0.0 2.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
AR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
AZ 0.0 0.0 0.0 5.1 1.9 0.0 0.0 0.0 0.0 5.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
CA 0.0 0.0 0.0 17.0 6,882.1 86.6 9.4 98.7 7.8 112.5 65.8 1.8 14.0 0.0 77.9 9.6 5.3 1.5 3.0 669.2 52.1 1.2 13.5
CO 0.0 0.0 0.0 4.7 65.0 115.0 0.0 10.0 0.0 0.0 0.0 0.0 0.0 0.0 2.0 0.0 0.0 0.0 0.0 4.3 9.0 0.0 0.0
CT 0.0 0.0 83.2 0.5 173.1 5.9 24.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.1 0.0 0.0 3.0 0.0 82.6 125.4 0.0 0.0
DC 0.0 0.0 0.0 0.0 16.3 2.2 0.0 27.0 0.0 12.0 6.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 7.3 11.6 0.0 0.0
DE 0.0 0.0 0.0 0.0 7.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
FF 0.0 0.0 0.0 11.2 1,386.5 87.8 7.2 3.1 0.6 45.0 2.7 0.4 0.0 0.0 20.2 0.0 9.1 0.0 0.0 229.3 12.7 0.0 0.1
FL 0.0 0.0 0.0 0.0 26.8 0.0 0.0 0.0 0.0 24.8 4.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.6 5.4 0.0 0.0 0.0
GA 0.0 1.6 0.0 0.0 14.2 1.1 0.0 0.0 0.0 2.0 43.3 0.0 0.0 0.0 0.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
IA 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
ID 0.0 0.0 0.0 0.1 0.0 3.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
IL 0.0 0.0 0.0 0.0 102.7 19.3 0.0 0.0 0.0 21.0 0.0 0.0 0.0 0.0 147.0 0.0 0.0 0.0 0.0 35.7 60.8 0.0 3.7
IN 0.0 0.0 0.0 0.0 13.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.7 3.5 0.8 0.0 0.0 7.2 0.0 0.0 0.0
KS 0.0 0.0 2.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.0 0.0 0.2 0.0 0.0 0.0
KY 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.9 0.0 1.5 0.0 0.0 0.0
LA 0.0 0.0 0.0 0.0 8.5 0.0 2.7 0.0 0.0 0.6 0.0 0.0 0.0 0.0 0.7 0.0 0.0 0.0 0.4 0.1 0.0 0.0 0.0
MA 0.0 0.0 0.0 3.8 938.4 21.7 42.3 0.3 30.0 21.8 4.8 0.0 0.8 5.0 36.9 0.1 0.8 2.3 6.0 976.1 2.2 19.5 1.9
MD 0.0 0.0 0.0 1.4 84.9 13.0 0.0 14.9 0.0 5.0 0.0 0.0 0.0 0.0 14.4 0.0 0.0 0.0 1.2 32.5 54.3 0.0 0.0
ME 0.0 0.0 0.0 0.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.4 0.0 1.1 0.0
MI 0.0 0.0 0.0 0.0 33.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 15.1 0.0 0.0 0.0 0.0 8.2 0.0 0.0 38.7
MN 0.0 0.0 0.0 0.0 55.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 5.0 0.0 0.0 0.0 0.0 3.6 0.0 0.0 0.0
MO 0.0 0.0 0.0 0.0 22.9 1.1 0.0 0.0 0.0 0.0 0.2 0.0 0.0 0.0 0.0 0.0 5.6 0.0 0.0 2.1 9.8 0.0 1.1
MT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NC 0.0 0.0 0.0 0.0 26.8 0.0 0.0 0.0 0.0 2.1 5.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 20.3 1.9 0.0 0.3
ND 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NE 0.0 0.0 0.0 0.0 0.0 1.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.0 1.0 0.0 0.0 0.0 0.0 0.0 0.0
NH 0.0 0.0 0.0 0.0 0.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.8 0.0 1.0 0.0
NJ 0.0 0.0 0.0 9.1 139.9 2.5 4.8 6.7 2.3 1.2 2.0 0.0 0.0 0.0 11.8 0.0 0.0 0.0 0.0 43.5 0.0 0.0 0.0
NM 0.0 0.0 0.0 0.0 0.0 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.5 0.0 0.0 0.0 0.0 0.9 0.0 0.0 0.0
NV 0.0 0.0 0.0 0.0 4.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.4 0.0 0.0 0.0
NY 0.0 1.0 0.0 17.6 1150.1 14.8 14.3 5.5 9.5 65.5 168.7 0.0 1.7 0.0 7.5 4.7 4.5 0.0 0.9 183.5 22.7 3.5 1.8
OH 0.0 0.0 0.0 0.0 7.8 0.1 0.0 0.0 0.0 8.3 0.0 0.0 0.0 0.0 14.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.0
OK 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.4 0.0 0.0 0.0 0.0 0.0 0.0
OR 0.0 0.0 0.0 0.0 1.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 5.0 0.0 0.0 0.0
PA 0.0 0.0 0.0 2.3 153.2 0.1 3.3 14.0 30.0 18.4 8.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 64.0 9.8 0.0 1.3
RI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.4 0.0 0.0 0.0
SC 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
SD 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.6 0.0 0.0 0.0
Target State
SOURCE
STATE AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IND KS KY LA MA MD ME MI
TN 0.0 0.0 0.3 0.0 3.4 0.0 0.0 0.0 0.0 0.0 4.6 0.0 0.0 0.0 2.5 0.0 0.0 0.0 0.0 6.2 0.0 0.0 0.0
TX 0.0 0.0 1.1 0.0 238.4 1.6 0.0 0.0 0.0 46.6 0.0 0.0 0.0 0.0 4.2 0.0 0.0 0.0 0.0 1.1 0.0 0.0 1.9
UN 0.0 1.3 0.1 35.3 2,698.2 37.8 53.9 86.6 8.0 27.2 88.2 0.4 6.0 1.5 50.7 7.6 5.2 3.1 2.6 631.0 225.5 0.5 22.1
UT 0.0 0.0 0.0 5.0 28.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.4 0.0 0.0
VA 0.0 0.0 0.0 0.0 30.8 11.8 0.0 6.0 0.0 2.1 6.7 0.0 0.0 0.0 2.1 0.0 0.0 0.0 0.0 18.0 63.8 0.0 1.6
VT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
WA 0.0 0.0 0.0 0.0 141.8 4.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.5 0.0 0.0 0.0 0.0 10.2 0.8 0.0 3.5
WI 0.0 0.0 0.0 0.0 12.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 5.8 0.0 0.0 0.0 0.0 0.8 0.0 0.0 6.4
WV 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total 0.0 5.2 86.6 113.3 14,471.5 431.3 162.6 274.6 88.4 421.0 413.4 2.5 22.5 6.5 427.5 25.4 32.9 10.8 14.8 3,062.1 662.8 26.8 99.9
Target State
Figure 3.29b
SOURCE
STATE MN MO MS MT NC ND NE NH NJ NM NV NY OH OK ORE PA PR RI SC SD TN TX UN
AL 0.0 0.0 0.0 0.0 1.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.1 0.0 0.0 0.0 0.0
AR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.5 0.0
AZ 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.6 0.0 0.0 0.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
CA 67.7 0.2 0.0 0.0 36.9 0.0 10.0 12.3 75.5 3.4 0.4 757.7 86.2 0.0 43.6 79.7 0.0 27.0 15.3 0.0 3.8 384.7 0.0
CO 2.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.0 5.6 0.0 0.0 3.3 0.0 0.0 0.5 0.0 0.0 0.0 2.6 0.0
CT 0.0 10.0 0.0 0.0 5.3 0.0 0.0 0.0 4.6 0.0 0.0 32.9 0.0 0.0 0.0 2.5 0.0 0.0 0.0 6.0 0.0 4.2 0.0
DC 11.0 0.0 0.0 0.0 5.3 0.0 0.0 0.0 0.0 0.0 0.0 5.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
DE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0
FF 12.7 1.5 0.0 0.0 57.0 2.3 0.0 0.2 19.0 1.7 0.0 257.5 21.5 0.0 3.9 34.8 0.0 18.9 8.6 0.0 0.0 69.8 0.0
FL 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.0 0.0 3.7 3.5 0.0 0.0 5.9 0.0 0.0 0.0 0.0 0.4 9.5 0.0
GA 5.2 0.0 0.0 0.0 0.9 0.0 0.0 0.6 0.0 0.0 0.0 4.7 0.0 0.0 0.0 0.0 0.0 0.0 3.7 0.0 5.8 0.7 0.0
IA 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
ID 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
IL 5.7 11.6 0.0 0.0 0.7 0.0 0.0 1.5 0.0 0.0 0.0 2.7 12.9 0.0 0.0 2.1 0.0 0.0 0.0 0.0 18.1 22.6 0.0
IN 2.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.9 0.0 0.0 1.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0
KS 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
KY 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
LA 0.0 0.2 0.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.7 0.0 0.0 0.0 0.1 0.0 0.0 0.0 0.0 0.0 6.7 0.0
MA 54.9 0.0 0.0 0.0 6.9 0.0 0.0 32.5 9.8 0.9 0.0 248.9 30.5 0.0 2.1 43.5 0.0 18.8 10.0 0.0 6.5 47.9 0.0
MD 0.0 0.0 0.0 0.0 11.3 0.0 0.0 0.0 6.0 0.0 8.0 37.1 0.0 0.0 0.0 9.5 0.0 0.0 0.0 0.0 0.0 0.2 0.0
ME 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
MI 12.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.1 0.0 2.0 0.6 0.0 0.4 1.0 0.0 0.0 4.3 0.0 0.0 1.1 0.0
MN 17.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.5 0.0 0.0 0.0 0.8 0.0 6.0 0.0 0.0 0.0 0.0 0.0 5.4 0.0 0.0
MO 0.0 7.3 0.0 0.0 1.3 0.0 0.0 0.0 0.0 2.1 0.0 0.4 2.8 0.0 0.0 0.0 0.0 0.0 4.6 0.0 4.0 4.3 0.0
MT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Target State
Figure 3.29b
SOURCE
STATE MN MO MS MT NC ND NE NH NJ NM NV NY OH OK ORE PA PR RI SC SD TN TX UN
NC 0.0 0.0 0.0 0.0 53.4 0.0 0.0 0.0 0.0 0.0 0.0 2.0 0.0 0.0 0.0 3.0 0.0 0.0 4.0 0.0 0.9 20.5 0.0
ND 5.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NE 0.0 0.2 0.0 0.0 0.0 0.0 3.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NH 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NJ 10.2 1.8 0.0 0.0 0.0 11.2 0.0 5.0 35.8 0.0 0.0 26.1 0.0 0.0 0.0 8.9 0.0 0.0 0.0 0.0 0.0 1.9 0.0
NM 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 10.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NV 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 2.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
NY 0.0 0.2 0.0 0.0 16.4 0.0 0.1 7.0 83.8 0.0 0.0 519.0 21.9 0.0 2.0 28.8 0.0 5.0 8.6 6.0 0.0 199.3 0.0
OH 2.7 0.0 0.0 0.0 2.3 0.0 0.0 0.0 0.0 0.2 0.1 8.8 56.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
OK 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.7 0.0 4.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.2 0.0
OR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
PA 3.0 5.2 0.0 0.0 0.1 0.0 0.0 6.0 13.9 0.0 0.0 81.8 1.6 0.0 2.3 82.6 0.0 3.7 0.0 0.0 0.0 9.6 0.0
RI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.6 0.0 0.0 0.0 0.0 0.0
SC 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
SD 0.0 0.0 0.0 0.0 0.0 0.0 1.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
TN 0.0 0.0 0.1 0.0 10.1 0.0 0.0 0.0 0.0 0.0 0.0 4.1 0.0 0.0 0.0 0.8 0.0 0.0 0.0 0.0 30.4 20.0 0.0
TX 0.0 6.6 0.0 0.0 0.0 0.0 0.0 0.0 5.0 1.6 0.0 2.7 0.0 0.0 0.0 0.1 0.0 0.0 0.0 0.0 0.3 275.6 0.0
UN 48.0 20.4 0.8 0.0 45.8 10.6 5.9 4.1 87.3 1.8 1.0 639.1 43.0 3.1 52.2 133.4 0.0 5.0 24.6 0.0 30.9 174.4 0.0
UT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.7 0.0 14.9 0.0 0.0 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
VA 5.0 0.0 0.0 0.0 0.7 0.0 0.0 0.0 0.0 0.0 0.0 12.3 0.0 0.0 0.0 3.1 0.0 0.0 0.0 0.0 2.8 0.2 0.0
VT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
WA 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.3 0.0 0.0 8.6 13.5 0.0 11.1 0.0 0.0 0.0 0.0 0.0 0.0 9.0 0.0
WI 0.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
WV 0.0 0.0 0.0 0.0 0.0 0.0 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total 267.0 65.0 1.2 0.0 255.6 24.1 21.0 74.4 351.3 25.9 9.6 2,686.3 301.8 8.0 130.3 441.1 0.0 81.7 85.7 11.9 109.3 1,272.4 0.0
Target State
Figure 3.29c
Sources and Targets of Invested Capital
Investments 2013 ($ Millions)
SOURCE
STATE UT VA VI VT WA WI WV WY TOT
AL 0.0 4.7 0.0 0.0 0.0 0.0 0.0 0.0 14.2
AR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.5
AZ 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 13.0
CA 96.7 50.0 0.0 0.0 176.6 6.1 0.0 0.0 10,062.8
CO 0.0 20.0 0.0 0.0 19.2 0.0 0.0 0.0 263.7
CT 0.1 0.0 0.0 0.0 21.2 0.0 0.0 0.0 591.1
DC 0.0 59.9 0.0 0.0 0.0 0.0 0.0 0.0 164.9
DE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 7.8
FF 3.7 57.5 0.0 0.9 30.1 0.2 0.0 0.0 2,417.5
FL 0.0 0.0 0.0 0.0 5.7 0.0 0.0 0.0 90.4
GA 0.0 8.0 0.0 1.3 0.0 0.0 0.0 0.0 93.5
IA 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.2
ID 1.5 0.0 0.0 0.0 0.1 0.0 0.0 0.0 4.8
IL 0.0 3.3 0.0 0.0 37.9 2.1 0.0 0.0 511.4
IN 1.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 32.7
KS 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.4
KY 0.0 0.0 0.0 0.0 0.0 1.0 0.0 0.0 3.8
LA 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 25.1
MA 16.0 44.5 0.0 5.2 44.4 0.0 0.0 0.0 2,738.1
MD 1.0 11.1 0.0 0.0 25.0 0.0 0.0 0.0 331.0
ME 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.5
MI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 119.0
MN 0.0 0.0 0.0 0.0 0.1 0.0 0.0 0.0 97.4
MO 0.0 0.0 0.0 0.0 0.1 0.0 0.0 0.0 69.5
MT 0.0 0.0 0.0 0.0 0.1 0.0 0.0 0.0 0.1
Target State
Figure 3.29c
Sources and Targets of Invested Capital Investments
2013 ($ Millions)
SOURCE
STATE UT VA VI VT WA WI WV WY TOT
NC 2.2 0.1 0.0 0.0 3.3 0.0 0.0 0.0 146.0
ND 0.0 0.0 0.0 0.0 0.0 0.2 0.0 0.0 5.3
NE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.7
NH 0.0 0.0 0.0 0.0 2.5 0.0 0.0 0.0 15.6
NJ 0.0 0.0 0.0 0.0 5.0 0.0 0.0 0.0 329.8
NM 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 12.0
NV 0.0 0.0 0.0 0.0 0.3 0.0 0.0 0.0 7.8
NY 34.1 37.5 0.0 0.0 43.3 4.3 0.0 0.0 2694.8
OH 0.0 0.0 0.0 0.0 0.4 0.0 0.0 0.0 103.3
OK 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 10.1
OR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 9.3
PA 0.0 90.0 0.0 0.0 34.9 0.0 0.2 0.0 639.3
RI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.1
SC 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
SD 2.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.7
TN 7.2 0.0 0.0 0.0 0.5 0.0 0.0 0.0 90.2
TX 1.0 4.7 0.0 0.0 2.8 0.0 0.0 0.0 595.2
UN 66.1 146.8 0.0 10.0 286.4 15.7 1.0 0.0 5,850.1
UT 60.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 111.3
VA 0.0 53.0 0.0 0.0 17.3 0.0 0.0 0.0 237.5
VT 0.0 0.0 0.0 3.6 0.0 0.0 0.0 0.0 3.6
WA 6.5 0.0 0.0 0.0 113.7 0.0 0.0 0.0 329.8
WI 13.1 0.0 0.0 0.0 3.3 6.2 0.0 0.0 53.8
WV 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.2
Total 313.8 591.0 0.0 21.0 874.1 35.9 1.2 0.0 28,922.8
Figure 3.30 2013 Internet-Related
Investments By Stage
Company Stage ($ Millions)
Seed 348.75
Early Stage 6,036.86
Expansion 7,559.33
Later Stage 5,064.38
TOTAL 19,009.32
Figure 3.31
2013 Internet-Related Investments By Industry Sector
Industry Group ($ Millions)
Software 10,821.33
Media and Entertainment 2,771.45
IT Services 1,966.98
Consumer Products and Services 1,074.01
Networking and Equipment 669.55
Telecommunications 572.39
Financial Services 324.00
Retailing/Distribution 228.44
Computers and Peripherals 222.24
Semiconductors 132.53
Healthcare Services 107.14
Business Products and Services 53.76
Industrial/Energy 22.52
Biotechnology 16.23
Medical Devices and Equipment 15.65
Other 5.61
Electronics/Instrumentation 5.50
Total 19,009.32
Figure 3.32
2013 Internet-Related vs. Non Internet-Related By Industry Sector ($ Million)
Industry Internet Related Non-Internet Related Total
Biotechnology 16.2 4,545.7 4,561.9
Business Products and Services 53.8 164.2 218.0
Computers and Peripherals 222.2 295.0 517.2
Consumer Products and Services 1,074.0 171.5 1,245.5
Electronics/Instrumentation 5.5 318.8 324.3
Financial Services 324.0 212.4 536.4
Healthcare Services 107.1 179.0 286.1
Industrial/Energy 22.5 1,484.0 1,506.5
IT Services 1,967.0 25.9 1,992.9
Media and Entertainment 2,771.4 164.1 2,935.5
Medical Devices and Equipment 15.6 2,114.5 2,130.2
Networking and Equipment 669.6 - 669.6
Other 5.6 93.0 98.6
Retailing/Distribution 228.4 12.0 240.4
Semiconductors 132.5 464.9 597.4
Software 10,821.3 198.7 11,020.0
Telecommunications 572.4 71.2 643.6
Total 19,009.3 10,514.8 29,524.1
Figure 3.33
2013 Internet-Related vs. Non Internet-Related By Industry Sector
(Number of Companies)
Industry Internet Related Non-Internet Related Total
Biotechnology 4 367 371
Business Products and Services 17 41 58
Computers and Peripherals 18 11 29
Consumer Products and Services 114 35 149
Electronics/Instrumentation 2 31 33
Financial Services 26 25 51
Healthcare Services 13 24 37
Industrial/Energy 7 191 198
IT Services 292 5 297
Media and Entertainment 368 15 383
Medical Devices and Equipment 6 244 250
Networking and Equipment 22 22
Other 1 10 11
Retailing/Distribution 38 2 40
Semiconductors 13 60 73
Software 1,291 25 1,316
Telecommunications 49 6 55
Total 2,281 1,092 3,373
Figure 3.34
Top 5 States By Pecentage Invested Within State in 2013
Fund Domicile Pct. Invested
Within State
California 68%
Ohio 55%
Utah 55%
Texas 46%
Georgia 46%
*Minimum $20 million invested
Figure 3.35 Top 5 States By Portion Received From In-State
Firms 2013
Fund Domicile Pct. Invested Within State
California 48%
New Mexico 40%
Michigan 39%
Illinois 34%
Massachusetts 32%
*Minimum $20 million invested
Figure 3.36
Number of States Invested Into in 2013
By State of Venture Firm
Location of Venture Firm No. of States Invested In
California 38
Massachusetts 36
New York 36
Pennsylvania 27
Illinois 19
Connecticut 18
Maryland 18
New Jersey 18
Virginia 18
Texas 17
Georgia 16
Missouri 16
Figure 3.37
Number of States California Venture Firms
Into By Year
Year No. of States Invested In
1993 32
2003 34
2013 38
Figure 3.38
Corporate Investments By Year
Year # All Venture
Capital Deals
# Deals with CVC
Involvement
Calculated Percentage
of Deals with Corporate
VC Involvement
$M Average
Amount of All
VC Deals
$M Average
Amount of CVC
Participation
Total VC
Investment
$M
Total CVC
Investment $M
Calculated Percentage
of Dollars Coming from
CVCs
1995 1,896 140 7.4% 4.23 3.08 8,015 431 5.4%
1996 2,635 234 8.9% 4.30 3.37 11,342 787 6.9%
1997 3,224 324 10.0% 4.65 2.85 15,005 922 6.1%
1998 3,729 495 13.3% 5.76 3.63 21,473 1,795 8.4%
1999 5,597 1230 22.0% 9.80 6.43 54,847 7,908 14.4%
2000 8,038 1950 24.3% 13.08 7.63 105,105 14,877 14.2%
2001 4,590 964 21.0% 8.92 4.81 40,952 4,639 11.3%
2002 3,206 551 17.2% 6.92 3.33 22,177 1,837 8.3%
2003 3,024 439 14.5% 6.49 2.91 19,620 1,279 6.5%
2004 3,228 545 16.9% 7.19 2.76 23,209 1,505 6.5%
2005 3,293 565 17.2% 7.14 2.68 23,524 1,514 6.4%
2006 3,882 817 21.0% 7.09 3.16 27,515 2,581 9.4%
2007 4,226 846 20.0% 7.56 3.21 31,943 2,714 8.5%
2008 4,177 896 21.5% 7.17 2.99 29,949 2,679 8.9%
2009 3,148 405 12.9% 6.44 3.28 20,286 1,327 6.5%
2010 3,647 487 13.4% 6.41 3.86 23,369 1,879 8.0%
2011 4,004 590 14.7% 7.43 3.80 29,730 2,243 7.5%
2012 3,865 611 15.8% 7.08 3.69 27,352 2,256 8.2%
2013 4,041 683 16.9% 7.31 4.55 29,545 3,105 10.5%
Figure 3.39
Clean Technology Investments By Year
Year Clean Technology
Investments
($ Millions)
# Clean Technology
Deals
Average Investment
Per Deal ($ Millions)
1995 64.6 34 1.9
1996 141.5 44 3.2
1997 180.4 51 3.5
1998 170.2 40 4.3
1999 262.1 53 4.9
2000 592.7 49 12.1
2001 335.4 57 5.9
2002 350.3 49 7.1
2003 237.5 58 4.1
2004 417.5 78 5.4
2005 614.7 97 6.3
2006 1,772.8 152 11.7
2007 3,036.0 261 11.6
2008 4,225.7 306 13.8
2009 2,244.6 234 9.6
2010 3,944.8 305 12.9
2011 4,392.0 333 13.2
2012 3,081.0 246 12.5
2013 1,468.0 184 8.0
27.8%
9.7%
39.0%
41.5%
8.8%
55.7%
11.0%
8.5%
63.4%
34.7%
50.0% 50.0%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1998 2003 2008 2013
Other
SoCal
NoCal
Figure 3.40 California Investments as a Percentage of
Overall Investment (Dollars Invested)
EXITS
IPOs and Acquisitions
0.00
5.00
10.00
15.00
20.00
25.00
30.00
0
50
100
150
200
250
300
'85 '86 '87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 13
O
f
f
e
r

(
$

B
i
l
l
i
o
n
)

N
o
.

o
f

I
P
O
s

Year
No of IPOs
Offer Amount ($B)
Figure 4.01
Venture-Backed IPOs
Once successful portfolio companies mature, venture funds generally exit their positions in those companies by taking them public through an initial
public offering (IPO) or by selling them to presumably larger organizations (acquisition, M&A, or trade sale). This then lets the venture fund dis-
tribute the proceeds to investors, raise a new fund for future investment, and invest in the next generation of companies. This chapter considers each
type of exit separately.
During 2013, 81 venture-backed companies went public in the United States, marking the strongest full year total for the number of new venture-backed
listings since 2007. Remarkably, more than half of them were biotechnology IPOs, many of those being modestly sized. While the total dollars raised in
2012 was higher at $21.5 billion, it is important to remember that $16.0 billion of that came from the Facebook IPO alone. The remaining $5.5 billion
was raised by the remaining 48 IPOs in 2012. It was a very different story in 2013. $11.1 billion was raised by 81 companies. The increase in mean and
median time to exit refects the fact that many of these IPOs were mature companies, and many of them were in the life sciences space, which had been
awaiting an IPO opportunity for months, and in some cases, years.
NVCA is encouraged by the increase in smaller IPOs and biotech IPOs in light of its 2012 legislative successes with the JOBS Act and creating a
pathway for FDA Reform.
The M&A space continued to soften in 2013, with the total number of deals falling from 473 in the prior year to 376. Total proceeds fell by 27%. Note
that only 94 of the 376 acquisitions had reported deal values. Historically, deals with unreported sales prices are fairly diminutive, and in many cases,
fre sales. However, an increasing number of deal term sheets specify a non-disclosure restriction on all parties. So going forward, all but the largest
and most visible acquisitions may be hard to measure. Observers have wondered why, given the huge amounts of cash on the balance sheets of technol-
ogy and biotechnology giants, more acquisitions are not occurring. We did see a furry of acquisitions in early 2014, perhaps signaling an increase in
that kind of activity.
Methodology
This chapter focuses on company exits by venture funds through IPOs
and through acquisitions (trade sale, M&A). Some additional charts are
provided on private equity-backed acquisitions because of the venture in-
dustrys interest in that data. With Thomsons expansion of global deals
coverage beginning in 2012, the criteria used to report these exits were
redefned and refned. These are explained below.
In this chapter and throughout this Yearbook, we use the classic nomen-
clature for describing the two main types of private equity:
Private Equity = Venture Capital + Buyout/Mezzanine
Therefore, charts describing Private Equity in this chapter and through-
out this Yearbook include both buyout/mezzanine activity and venture
capital activity.
The Thomson Reuters venture capital (private equity) exits coverage
Fig. 4.02
Number of Venture-Backed IPOs
vs. All IPOs
Year # of All IPOs # of Venture-
Backed IPOs
2000 353 238
2001 84 37
2002 75 24
2003 70 26
2004 189 82
2005 171 59
2006 168 67
2007 164 91
2008 25 7
2009 39 13
2010 103 70
2011 98 51
2012 113 49
2013 169 81
Note: IPO counts reect IPOs on US stock exchanges
and markets. Venture-backed IPOs are those with at
least one US-domiciled venture fund investor.
includes full history for the US and Canada as well as Global Exits from
2005 to the present. Multiple exits per company are now tracked, includ-
ing IPOs (although secondary offerings are not tracked, since the frst
IPO is considered the exit), Secondary Sales (sponsor to sponsor), Trade
Sales (VC (PE) Firm to Non-PE Firm), Buybacks, Reverse Takeovers
and Writeoffs. All values are sourced from the industry-leading Thomson
Reuters Deals database with hyperlinks to the Tearsheets to view the un-
derlying details of the transactions. The private equity-backed exits com-
ponent in ThomsonONE.com can be used to further analyze all of the VC
and PE Exits content herein.
Specifcally, venture capital IPO exits reported in this chapter are those
done on United States stock exchanges/markets with at least one United
States domiciled venture fund investor.
Specifcally, venture capital (private equity) acquisition exits reported
in this chapter are completed secondary sales and trade sales where the
company was domiciled in the United States and had at least one United
States domiciled venture capital (private equity) investor.
Fig. 4.03
Venture-Backed IPOs 1985 to 2013 Value and Age Characteristics
Year Num
of IPOs
Offer Amount
($Mil)
Med Offer
Amt ($Mil)
Mean Offer
Amt ($Mil)
Post Offer
Value ($Mil)
Med Post
Value ($Mil)
Mean Post
Value ($Mil)
Median Time
to Exit (yrs)
Mean Time to
Exit (yrs)
1985 48 763 13 16 2,020 37 48 2.8 3.9
1986 105 2,417 13 23 166,032 52 1866 3.9 4.2
1987 86 2,125 17 25 10,972 46 155 3.7 3.9
1988 43 769 15 18 21,117 51 571 3.2 3.7
1989 42 873 16 21 4,443 50 131 3.9 4.2
1990 47 1,108 20 24 5,886 60 178 3.6 4.2
1991 120 3,726 27 31 17,611 81 202 4.7 5.0
1992 150 5,443 24 36 15,955 68 146 4.5 5.0
1993 175 6,154 25 35 14,808 75 130 5.4 5.7
1994 138 3,952 24 29 10,344 68 94 4.7 5.3
1995 184 7,859 36 43 19,300 104 152 3.8 4.8
1996 256 12,716 35 50 51,511 112 240 3.2 4.1
1997 141 5,829 33 41 19,101 99 148 3.0 6.4
1998 78 4,125 43 53 24,655 164 324 2.5 3.1
1999 280 23,975 69 86 147,341 304 532 2.9 3.1
2000 238 27,443 83 115 108,783 325 494 3.1 3.7
2001 37 4,130 80 112 19,233 327 534 4.0 4.4
2002 24 2,333 89 97 8,322 266 347 3.3 5.0
2003 26 2,024 71 78 7,412 252 285 5.4 5.6
2004 82 10,032 70 122 50,268 254 613 5.5 6.1
2005 59 5,113 68 87 39,702 202 673 5.2 5.3
2006 67 7,065 86 105 71,124 283 1078 5.3 5.6
2007 91 12,339 98 136 68,203 365 749 6.0 6.0
2008 7 765 83 109 3,645 278 521 7.4 7.3
2009 13 1,980 123 152 9,192 548 707 5.9 6.9
2010 70 7,774 93 111 114,981 428 1643 5.0 5.9
2011 51 10,690 106 210 94,657 606 1856 6.3 7.0
2012 49 21,460 89 438 122,168 371 2493 7.2 7.8
2013 81 11,068 91 137 62,700 354 784 7.4 8.1
Fig. 4.04
Venture-Backed IPOs by MoneyTree Industry Total Offering Size ($ Million)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 38 349 217 26 51 66 964 860 486 257 437 1,250 575 197 562
Services
58 33 0 2 0 44 66 70 193 70 35 496 185 58 1,137
Services
7 177 7 8 91 5 186 240 169 58 335 177 160 541 602
Financial Services 0 91 39 10 47 0 21 1,248 51 237 273 1,597 209 45 521
Industrial/Energy 29 58 177 75 127 242 346 325 670 437 495 1,064 794 138 207
IT Services 15 4 32 27 0 0 163 48 41 68 308 396 151 239 2,141
Media and Entertainment 51 599 22 3 17 10 103 253 710 562 207 727 505 199 2,872
Medical Devices and
Equipment
61 89 147 22 71 90 241 601 254 388 995 1,666 444 90 0
Networking and Equipment 25 105 136 42 43 82 346 284 233 457 313 749 416 235 2,912
Other 0 54 0 0 0 0 0 12 0 0 0 0 203 0 46
Retailing/Distribution 154 67 48 146 35 18 29 265 718 71 111 358 159 344 1,736
Semiconductors 15 47 368 79 62 29 210 86 311 164 696 36 319 37 221
Software 52 270 206 134 135 192 476 409 846 447 2,366 1,851 912 870 5,618
Telecommunications 27 92 421 79 30 141 22 212 766 277 492 1,498 377 877 4,592
Total 763 2,417 2,125 769 873 1,108 3,726 5,443 6,154 3,952 7,859 12,716 5,829 4,125 23,975
Fig. 4.04 (Continued)
Venture-Backed IPOs by MoneyTree Industry Total Offering Size ($ Million)
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 4,211 353 342 442 1,616 897 895 1,292 6 153 1,155 997 854 3,507
Services
594 0 248 62 0 507 0 1,202 0 0 190 322 152 0
Services
295 120 39 82 280 3 542 154 0 163 727 847 262 631
Financial Services 50 771 231 353 1,447 706 551 1,178 0 0 558 0 185 253
Industrial/Energy 1,107 747 0 0 638 299 1,114 1,007 0 88 955 984 247 0
IT Services 2,030 0 0 0 49 140 207 836 0 0 379 163 636 576
Media and Entertainment 1,243 0 353 75 1,434 376 864 209 0 0 830 3,210 16,236 2,839
Medical Devices and
Equipment
634 673 456 0 806 380 633 1,407 134 0 299 145 115 283
Networking and Equipment 4,339 275 0 0 69 0 479 313 0 0 267 0 316 301
Other 177 100 0 0 0 0 0 0 0 0 0 0 0 0
Semiconductors 1,052 133 0 381 522 472 136 975 0 0 534 255 130 274
Software 4,924 405 259 330 2,506 570 768 1,471 344 604 1,368 2,500 2,022 2,022
Telecommunications 5,304 173 0 175 542 651 731 1,591 0 402 197 805 305 187
Total 27,443 4,130 2,333 2,024 10,032 5,113 7,065 12,339 765 1,980 7,774 10,690 21,460 11,068
Fig. 4.05
Venture-Backed IPOs by MoneyTree Industry Total Number of Companies
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 5 16 14 2 6 4 31 27 22 13 16 33 21 7 9
Services
1 2 0 1 0 1 3 3 6 3 1 6 3 1 16
Services
1 5 1 1 3 1 6 7 4 2 9 7 6 7 9
IT Services 1 1 3 1 0 0 5 1 1 3 5 9 4 5 28
Medical Devices and
Equipment
3 10 8 4 5 8 12 27 14 17 20 44 13 2 0
Other 0 1 0 0 0 0 0 1 0 0 0 0 1 0 1
Semiconductors 1 4 5 5 3 1 9 4 13 9 16 1 8 1 4
Software 3 15 10 7 8 9 14 13 26 19 56 53 26 20 80
Total 48 105 86 43 42 47 120 150 175 138 184 256 141 78 280
Fig. 4.05
Venture-Backed IPOs by MoneyTree Industry Total Number of Companies
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 47 4 4 7 26 15 16 20 1 2 13 11 12 42
Services
8 0 1 1 0 4 0 4 0 0 1 2 1 0
Services
3 3 1 2 3 1 4 1 0 1 5 2 3 3
IT Services 16 0 0 0 1 1 2 6 0 0 4 2 6 4
Media and Entertainment 11 4 1 7 4 6 2 0 0 6 9 4 6
Medical Devices and
Equipment
11 7 4 0 13 8 11 11 2 0 4 2 1 4
Other 1 1 0 0 0 0 0 0 0 0 0 0 0 0
Semiconductors 10 2 0 3 6 6 2 10 0 0 6 3 2 3
Software 58 5 5 4 10 6 7 13 2 5 12 9 9 13
Total 238 37 24 26 82 59 67 91 7 13 70 51 49 81
Fig. 4.06
Average and Median Age in Years by MoneyTree Industry Companies at IPO 2000-2013
2000 2001 2002 2003 2004 2005 2006
Industry Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median
Biotechnology 4.5 4.3 4.5 4.6 8.4 6.7 6.0 5.1 5.6 5.1 5.6 5.5 5.3 5.0
Business Products and Services 2.0 1.7 N/A N/A 2.7 2.7 5.7 5.7 N/A N/A 4.3 4.4 N/A N/A
Computers and Peripherals 4.3 2.8 N/A N/A 15.7 15.7 N/A N/A N/A N/A 0.8 0.8 N/A N/A
Consumer Products and Services 1.4 1.5 3.7 4.6 4.6 4.6 4.3 4.3 5.5 5.2 5.5 5.5 4.9 4.9
Electronics/Instrumentation 3.4 2.7 6.3 6.3 N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Financial Services 1.0 1.0 12.9 12.9 1.9 1.9 5.0 4.7 5.5 5.3 3.0 3.0 4.7 4.8
Healthcare Services 3.3 3.3 5.2 5.2 7.1 7.1 5.7 5.7 8.9 8.9 3.9 3.9 N/A N/A
Industrial/Energy 3.4 3.2 1.1 0.4 N/A N/A N/A N/A 7.7 3.4 8.2 7.0 2.1 0.6
IT Services 1.9 1.8 N/A N/A N/A N/A N/A N/A 5.3 5.3 3.8 3.8 6.0 6.0
Media and Entertainment 4.3 3.2 N/A N/A 4.4 3.5 5.7 5.7 6.0 5.8 4.6 4.4 8.4 8.2
Medical Devices and Equipment 5.1 4.8 4.8 4.5 3.7 3.2 N/A N/A 8.1 7.3 6.6 7.1 6.9 5.3
Networking and Equipment 3.3 3.0 4.2 4.2 N/A N/A N/A N/A 6.1 6.1 N/A N/A 7.0 6.6
Other 1.3 1.3 2.6 2.6 N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Retailing/Distribution 1.9 1.8 4.3 4.3 3.4 3.4 4.0 4.0 N/A N/A 6.1 6.1 1.5 1.5
Semiconductors 5.5 3.7 2.9 2.9 N/A N/A 5.3 4.1 6.5 6.4 4.3 5.0 6.7 6.7
Software 3.4 3.3 4.2 4.6 3.3 3.0 6.1 5.6 5.3 5.5 5.4 5.6 6.5 6.0
Telecommunications 3.6 3.1 1.4 1.4 N/A N/A 6.5 6.5 5.3 5.0 5.0 4.1 4.2 3.9
Average and Median Age in Years by MoneyTree Industry Companies at IPO 2000-2013
2007 2008 2009 2010 2011 2012 2013
Industry Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median
Biotechnology 5.1 5.1 7.0 7.0 10.4 10.4 5.7 4.8 6.6 5.5 5.9 6.0 8.2 7.5
Business Products and Services 6.1 5.2 N/A N/A N/A N/A 0.6 0.6 4.2 4.2 5.7 5.7 N/A N/A
Computers and Peripherals 6.7 6.7 8.7 8.7 N/A N/A N/A N/A 7.3 7.3 N/A N/A 5.0 5.0
Consumer Products and Services 17.8 17.8 N/A N/A 5.3 5.3 5.1 4.3 3.8 3.8 7.2 8.3 6.4 3.9
Electronics/Instrumentation N/A N/A N/A N/A 7.8 7.8 N/A N/A 12.5 12.5 N/A N/A N/A N/A
Financial Services 3.1 3.4 N/A N/A N/A N/A 7.0 8.9 N/A N/A 9.3 9.3 6.7 6.7
Healthcare Services 9.9 9.9 10.2 10.2 2.0 2.0 2.6 2.6 N/A N/A N/A N/A N/A N/A
Industrial/Energy 1.0 0.9 N/A N/A 1.4 1.4 2.8 3.1 7.0 7.2 5.2 5.4 N/A N/A
IT Services 6.1 6.5 N/A N/A N/A N/A 7.6 8.6 8.9 8.9 10.1 7.9 9.9 9.1
Media and Entertainment 6.4 6.4 N/A N/A N/A N/A 7.9 7.4 6.4 6.1 6.3 6.4 7.9 7.6
Medical Devices and Equipment 6.7 6.6 6.0 6.0 N/A N/A 5.2 5.2 5.5 5.5 4.9 4.9 7.5 7.7
Networking and Equipment 6.3 6.7 N/A N/A N/A N/A 7.4 7.4 N/A N/A 10.1 9.9 5.7 6.2
Other N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A
Retailing/Distribution 3.1 3.1 N/A N/A N/A N/A 2.2 2.2 N/A N/A N/A N/A N/A N/A
Semiconductors 7.9 7.2 N/A N/A N/A N/A 4.9 4.4 7.6 7.6 13.1 13.1 8.8 9.5
Software 6.5 5.9 6.7 6.7 6.4 7.3 7.1 6.1 8.0 9.0 8.5 7.6 8.0 6.8
Telecommunications 6.8 7.2 N/A N/A 10.4 10.4 8.7 9.1 8.0 9.8 9.4 8.8 16.9 16.9
Fig. 4.07
Venture-Backed Merger & Acquisitions by Years
Year Number
Total
Number
Known
($ Millions)
Price
Average Mean Time
To Exit
(Years)
Median Time
To Exit
To Exit (Years)
1985 7 3 300.2 100.1 7.0 4.8
1986 8 1 63.4 63.4 3.4 3.5
1987 11 4 667.2 166.8 4.9 3.5
1988 17 9 920.7 102.3 4.7 4.1
1989 21 10 746.9 74.7 4.3 3.6
1990 19 7 120.3 17.2 5.8 5.5
1991 16 4 190.5 47.6 6.0 5.0
1992 69 43 2119.1 49.3 4.7 4.0
1993 59 36 1332.9 37.0 5.3 4.7
1994 84 57 3208.4 56.3 5.8 5.3
1995 92 58 3801.8 65.5 4.6 4.1
1996 108 76 8230.8 108.3 5.2 4.1
1997 145 100 7798.0 78.0 4.5 3.1
1998 189 113 8002.0 70.8 4.5 2.8
1999 228 155 38710.6 249.7 3.6 2.8
2000 379 245 79996.4 326.5 3.2 2.7
2001 384 175 25115.6 143.5 3.0 2.2
2002 365 166 11913.2 71.8 3.5 2.9
2003 323 134 8240.8 61.5 4.3 3.6
2004 402 199 28846.1 145.0 5.0 4.6
2005 446 201 19717.3 98.1 5.4 5.2
2006 484 208 24291.0 116.8 5.7 5.7
2007 488 201 30745.5 153.0 5.8 6.3
2008 417 134 16236.9 121.2 5.8 5.6
2009 351 109 12364.9 113.4 5.7 5.5
2010 523 150 17707.3 118.0 5.8 5.0
2011 490 169 24093.2 142.6 5.8 5.0
2012 473 132 22694.2 171.9 6.2 5.6
2013 376 94 16586.5 176.5 5.9 5.0
Fig. 4.08
Private Equity-Backed Merger & Acquisitions by Years
Year Number
Total
Number
Known
($ Millions)
Price
Average Mean Time
To Exit
(Years)
Median Time
To Exit
To Exit (Years)
1985 8 3 300.2 100.1 7.2 5.3
1986 13 4 246.4 61.6 3.6 4.0
1987 17 8 1422.2 177.8 4.1 3.3
1988 35 21 4139.2 197.1 3.8 3.4
1989 30 17 2594.8 152.6 4.4 3.6
1990 29 12 929.7 77.5 6.1 5.3
1991 29 11 774.5 70.4 5.2 4.7
1992 92 59 3652.8 61.9 4.7 4.0
1993 101 61 4355.5 71.4 5.1 4.7
1994 110 71 7848.2 110.5 5.6 5.0
1995 144 90 11057.4 122.9 5.1 4.8
1996 160 117 19587.9 167.4 4.8 3.9
1997 221 150 31562.5 210.4 5.0 3.8
1998 276 182 35578.7 195.5 4.5 3.0
1999 307 204 62827.4 308.0 3.8 3.0
2000 475 304 136325.6 448.4 3.5 2.8
2001 462 219 64564.5 294.8 3.4 2.4
2002 443 221 36264.2 164.1 3.8 3.0
2003 428 201 26264.8 130.7 4.5 3.8
2004 560 290 56179.7 193.7 5.2 4.6
2005 685 316 68468.5 216.7 5.4 5.2
2006 777 337 112915.0 335.1 5.6 5.5
2007 879 362 183217.8 506.1 5.6 5.2
2008 672 226 64078.8 283.5 5.3 4.6
2009 495 163 57883.9 355.1 5.5 4.9
2010 849 288 101808.3 353.5 5.7 4.7
2011 846 297 95368.7 321.1 5.8 5.0
2012 968 302 134158.0 444.2 5.9 5.3
2013 802 203 91618.3 451.3 5.9 5.4
Average acquisition price is calculated by dividing total known acquisition proceeds
by the number of transactions where the proceeds are known, not the total number of
transactions. Note: Private Equity includes venture capital, buyouts, mezzanine, and
other private equity nanced companies. Therefore, data from g. 4.07 is included
here.
Average acquisition price is calculated by dividing total known acquisition proceeds
by the number of transactions where the proceeds are known, not the total number
of transactions.
Fig. 4.09
Fig. 4.09 Venture-Backed Acquisitions by MoneyTree Industry Total Transaction Values 1985 to 2013
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 0 0 0 0 0 0 68 33 25 9 89 388 265 141 846
Services
0 0 640 0 0 0 0 0 0 0 0 109 181 47 397
Services
0 0 0 0 0 0 10 1 0 26 23 46 237 388 503
Financial Services 0 0 0 140 0 0 0 1,204 91 144 734 67 34 459 1,299
Industrial/Energy 99 63 0 238 59 20 0 203 122 764 53 1,127 193 381 962
IT Services 0 0 0 0 0 0 0 0 0 0 15 315 80 523 699
Media and Entertainment 0 0 0 0 0 0 30 0 119 29 38 2,160 2,106 343 10,878
Medical Devices and
Equipment
201 0 3 0 317 0 0 234 43 295 110 298 507 130 298
Networking and Equipment 0 0 0 18 250 0 0 0 317 352 1,024 1,090 178 981 11,521
Other 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Semiconductors 0 0 0 0 0 0 0 0 0 59 84 54 11 627 1,903
Software 0 0 25 0 0 22 83 264 116 455 617 1,228 2,176 2,888 5,621
Telecommunications 0 0 0 0 0 0 0 4 298 790 328 381 1,133 521 2,241
Total 300 63 667 921 747 120 190 2,119 1,333 3,208 3,802 8,231 7,798 8,002 38,711
Fig. 4.09 Venture-Backed Acquisitions by MoneyTree Industry Total Transaction Values 1985 to 2013
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 1,206 679 115 259 688 2,462 2,104 6,050 1,266 843 3,720 3,948 2,967 3,075
Services
1,637 157 870 151 3,024 132 409 2,124 570 314 181 315 697 0
Computers and Peripherals 4,610 357 51 47 680 248 492 6 49 500 348 557 764 945
Services
2,611 519 343 418 444 582 486 245 284 0 141 1,143 615 0
Electronics/Instrumentation 3,456 167 71 6 116 72 38 87 80 0 0 510 0 115
Financial Services 1,355 617 557 98 250 890 985 1,896 988 0 812 466 435 0
Healthcare Services 286 177 818 37 6,227 624 968 542 27 5 755 601 756 250
Industrial/Energy 1,396 858 182 1,006 2,128 1,117 1,425 1,799 832 886 1,276 1,674 1,141 455
IT Services 2,384 491 612 1,002 1,999 1,066 795 2,482 745 203 1,415 2,084 2,077 898
Media and Entertainment 3,227 6,315 999 324 3,355 2,980 2,599 3,039 2,251 892 1,051 1,013 2,430 1,382
Medical Devices and
Equipment
433 932 414 465 1,168 1,268 1,704 1,832 499 2,569 1,571 3,809 1,779 1,528
Networking and Equipment 18,359 5,425 818 813 1,311 1,290 628 549 609 643 678 24 146 430
Other 0 0 350 0 0 212 0 246 0 0 95 0 0 0
Semiconductors 7,210 2,099 2,703 359 688 575 1,029 964 664 628 1,047 743 1,284 1,601
Software 23,475 3,689 1,886 2,098 4,972 4,886 7,879 6,923 5,575 1,745 3,775 6,756 5,623 5,328
Telecommunications 7,528 2,630 1,125 301 1,678 1,313 2,287 1,785 1,789 2,205 826 451 1,980 550
Total 79,996 25,116 11,913 8,241 28,846 19,717 24,291 30,746 16,237 12,365 17,707 24,093 22,694 16,587
Fig. 4.10
Venture-Backed Acquisitions by MoneyTree Industry Number of Companies 1985 to 2013
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 0 0 0 0 1 1 1 4 2 4 10 10 9 11 12
Services
0 0 1 1 0 0 1 1 0 1 0 3 2 4 4
Services
0 0 0 0 0 0 1 2 3 1 1 5 7 7 11
IT Services 0 1 0 1 1 1 0 0 0 0 2 5 7 11 16
Medical Devices and
Equipment
2 0 1 2 5 2 0 13 4 8 7 6 13 11 10
Other 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0
Semiconductors 0 0 0 0 0 1 2 1 1 3 3 2 2 8 9
Software 1 3 3 0 1 6 1 11 15 24 29 21 44 62 59
Total 7 8 11 17 21 19 16 69 59 84 92 108 145 189 228
Venture-Backed Acquisitions by MoneyTree Industry Number of Companies 1985 to 2013
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 16 21 9 15 24 29 32 32 24 19 38 34 33 22
Services
15 29 14 15 20 22 24 35 14 13 14 13 15 5
Services
16 14 7 11 10 11 10 11 11 7 7 8 11 7
IT Services 23 31 38 25 33 22 30 38 27 22 46 48 51 26
Medical Devices and
Equipment
9 19 12 9 23 27 25 27 13 26 21 37 32 25
Other 0 0 1 1 1 1 0 2 2 0 1 2 0 1
Semiconductors 21 14 14 11 17 17 20 19 24 22 27 15 18 14
Software 118 94 129 120 133 163 177 157 148 120 171 171 162 162
Total 379 384 365 323 402 446 484 488 417 351 523 490 473 376
Fig. 4.11
Private Equity-Backed Acquisitions by MoneyTree Industry Total Transaction Values 1985 to 2013
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 0 0 0 0 766 0 68 33 25 93 448 412 472 498 904
Services
0 0 640 0 263 7 12 0 0 750 419 220 1331 694
Services
0 116 0 1444 798 45 10 30 634 1729 706 1078 1360 1676 827
IT Services 0 0 0 7 0 0 0 0 0 0 15 485 1620 533 2820
Medical Devices and
Equipment
201 68 383 0 317 167 0 575 182 1731 244 1000 1378 2075 1341
Other 0 0 0 0 0 0 0 0 0 0 0 0 0 229 0
Semiconductors 0 0 0 0 0 0 0 0 0 67 97 54 11 640 3066
Software 0 0 25 16 0 22 83 686 128 467 629 1228 2357 3196 10115
Total 300 246 1422 4139 2595 930 775 3653 4356 7848 11057 19588 31563 35579 62827
Private Equity-Backed Acquisitions by MoneyTree Industry Total Transaction Values 1985 to 2013
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 2102 801 2584 986 1805 3047 2384 7904 1830 6963 9043 6488 15784 7207
Services
2532 520 1381 254 4077 1982 11642 4709 6517 567 2262 2540 3711 6515
Services
3666 1628 2711 3656 5264 6074 10591 22156 2252 1451 7257 2413 4720 1137
IT Services 3138 533 674 1312 2135 2192 935 5362 5604 373 3717 2172 3960 4426
Medical Devices and
Equipment
556 1196 954 1168 2395 2364 3121 6691 6285 3610 8212 6201 8215 13093
Other 0 176 350 200 143 1676 630 426 8358 0 2865 871 3521 635
Semiconductors 7493 2224 3248 422 805 1276 1272 1591 850 628 1789 890 1408 1799
Software 25737 3796 2134 4087 5761 5603 10034 21470 7546 2327 15871 14993 13333 9841
Total 136326 64565 36264 26265 56180 68468 112915 183218 64079 57884 101808 95369 134158 91618
Fig. 4.12
Private Equity-Backed Acquisitions by MoneyTree Industry Number of Companies 1985 to 2013
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Biotechnology 0 0 0 0 3 1 1 4 3 7 13 11 10 15 14
Services
0 0 1 3 0 2 2 2 3 1 3 5 7 9 7
Services
0 2 1 3 3 1 2 6 10 4 5 13 14 19 15
IT Services 0 1 0 3 1 1 0 1 0 0 3 6 12 12 21
Medical Devices and
Equipment
2 1 2 2 5 3 0 15 5 9 11 9 17 17 14
Other 0 0 0 0 0 0 0 0 0 0 1 0 0 1 0
Semiconductors 0 0 0 0 0 1 2 1 1 3 4 2 2 10 11
Software 1 3 3 1 1 6 2 13 17 26 30 21 45 66 67
Total 8 13 17 35 30 29 29 92 101 110 144 160 221 276 307
Private Equity-Backed Acquisitions by MoneyTree Industry Number of Companies 1985 to 2013
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 18 22 11 17 28 34 33 36 28 26 48 42 46 31
Services
23 34 21 18 29 34 42 65 33 19 32 39 54 43
Services
23 25 22 25 39 33 55 62 40 25 43 43 49 57
IT Services 26 32 41 27 36 26 42 49 30 24 56 52 65 39
Medical Devices and
Equipment
13 20 14 14 27 35 32 41 20 40 42 55 51 39
Other 0 1 1 3 4 10 4 8 14 1 8 8 7 7
Semiconductors 26 15 16 11 19 19 21 23 30 22 30 19 20 16
Software 126 98 133 127 143 171 200 184 165 132 203 206 200 196
Total 475 462 443 428 560 685 777 879 672 495 849 846 968 802
*Note: Private Equity includes venture capital, buyouts, mezzanine, and other private equity-nanced companies. Therefore, transactions from Figure 4.10 are included here.
Fig. 4.13
Venture-Backed M&A Transaction Values vs.
Amount Invested
Year < TVI 1x-4x TVI 4x-10x TVI >10x TVI
1995 14% 26% 22% 38%
1996 8% 27% 30% 34%
1997 10% 41% 15% 34%
1998 15% 22% 31% 32%
1999 14% 15% 26% 45%
2000 8% 23% 22% 46%
2001 41% 19% 23% 17%
2002 50% 26% 13% 11%
2003 45% 38% 11% 5%
2004 36% 33% 20% 11%
2005 30% 37% 19% 14%
2006 29% 37% 18% 16%
2007 22% 30% 24% 23%
2008 28% 29% 25% 18%
2009 44% 21% 25% 10%
2010 31% 31% 22% 16%
2011 15% 27% 34% 24%
2012 18% 25% 29% 28%
2013 18% 37% 29% 16%
Fig. 4.14
Venture-Backed IPOs Cos In Registration vs.
Number of Venture-Backed IPOs
Year # of Venture Backed
IPOs
# of Moneytree Cos. in
Registration
2003 26 31
2004 82 57
2005 59 16
2006 67 36
2007 91 31
2008 7 20
2009 13 23
2010 70 31
2011 51 60
2012 49 27
2013 81 22
Fig. 4.15
Post-Offer Value Ranges by Number of Companies
Year $10B or
Greater
>$1B $500M-$1B $100M-$500M <$100M
1995 - 2 4 59 62
1996 - 5 11 110 89
1997 - 1 4 58 66
1998 - 6 3 50 17
1999 1 28 46 181 22
2000 - 27 37 138 18
2001 - 5 7 18 6
2002 - - 7 15 2
2003 - - 2 22 2
2004 1 4 10 64 4
2005 1 4 7 35 13
2006 1 7 11 44 4
2007 1 15 16 57 3
2008 - 2 - 4 1
2009 - 3 4 6 -
2010 2 21 6 41 2
2011 2 17 13 19 2
2012 2 9 9 29 2
2013 1 13 12 50 5
* Count only includes IPOs with disclosed post-offer values
This chart is prepared by analyzing all deals where total venture investment and ac-
quisition price are conrmed. Each deal is classied as a ratio of company acquisi-
tion (exit) price to total venture investment from all rounds. This chart compares the
number of deals in each category. An acquisition where deal price is less than the
total venture investment (<TVI) clearly did not result in a good return. Four times
the investment to 10 times the investment can be a good outcome. An acquisition
for more than 10 times venture investment is usually a nice outcome.
*Beginning in 2012, companies could elect condential registration.
Those, of course, cannot be counted in the number in registration.
As of this writing, it appears that half or more of companies
seeking to go public are electing condential registration.
Fig. 4.16
Deal Value Ranges by Number of Companies
Year >$1B $500M-$1B $100M-$500M <$100M
1995 - 1 10 47
1996 1 2 17 56
1997 - 1 22 77
1998 - - 27 86
1999 2 12 58 84
2000 15 23 101 106
2001 3 4 43 125
2002 1 3 28 134
2003 - 2 29 103
2004 5 6 45 143
2005 1 3 58 139
2006 2 3 62 141
2007 1 15 74 112
2008 2 4 42 87
2009 - 8 34 68
2010 - 11 49 90
2011 1 12 63 93
2012 5 10 53 64
2013 3 8 45 39
* Count only includes transactions with disclosed values
Fig. 4.17
Venture-Backed US Company IPOs by Year by Country
Country
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
#
Exits
Offer
Amt
($ Mil)
Argentina - - - - 1 332.8 - - - - - - - - - - - - 1 332.8
Bahamas - - 1 137.5 - - - - - - - - - - - - - - 1 137.5
Bermuda - - - - - - - - - - - - 1 621.3 - - - - 1 621.3
Canada 1 91.1 - - 1 57.5 - - - - - - - - - - - - 2 148.6
China 5 621.1 5 624.7 12 2,482.5 - - 2 220.0 21 2,838.3 8 1,739.7 2 165.7 4 556.3 59 9,248.2
France - - - - - - - - - - - - 1 77.0 - - 1 288.1 2 365.1
Hong Kong - - - - - - - - - - 1 103.3 - - - - - - 1 103.3
India - - - - - - - - - - 1 80.5 - - - - - - 1 80.5
Israel 2 67.5 1 78.0 - - - - - - - - - - - - 2 208.2 5 353.7
Netherlands - - - - - - - - - - - - 1 304.6 - - 1 89.7 2 394.3
Norway - - 1 43.8 - - - - - - - - - - - - - - 1 43.8
Russia - - 1 380.5 - - - - - - - - 1 1,434.8 - - - - 2 1,815.3
South Korea 2 190.8 1 144.1 - - - - - - - - - - - - - - 3 334.9
Taiwan 1 70.4 - - - - - - - - - - - - - - - - 1 70.4
United
Kingdom
- - - - - - - - - - - - - - - - 1 74.0 1 74.0
United
States
48 4,072.5 57 5,655.9 77 9,466.5 7 765.026 11 1,759.8 47 4,752.3 39 6,512.1 47 21,294.2 72 9,852.0 405 64,130.4
*To be included in this chart, non-US based companies must be trading on a U.S. exchange/market and have at least 1 U.S. venture fund investor.
2005 2006 2007 2008 2009 2010 2011 2012 2013 Total
Fig. 4.18
Ratio of IPO Pre-Money Valuation to Amount
Invested
Year Post Offer
Value
($ Billion)
Offer Amt
($ Billion)
IPO Pre
Money
Valuation
Total
Venture Inv.
($ Billion)
Ratio
1995 19.3 7.9 11.4 2.2 5.2
1996 51.5 12.7 38.8 3.7 10.5
1997 19.1 5.8 13.3 2.7 4.9
1998 24.7 4.1 20.5 2.4 8.6
1999 147.3 24.0 123.4 11.0 11.2
2000 108.8 27.4 81.3 13.0 6.3
2001 19.2 4.1 15.1 2.6 5.8
2002 8.3 2.3 6.0 1.7 3.5
2003 7.4 2.0 5.4 2.4 2.2
2004 50.3 10.0 40.2 6.7 6.0
2005 39.7 5.1 34.6 3.1 11.2
2006 71.1 7.1 64.1 4.3 14.9
2007 68.2 12.3 55.9 6.7 8.3
2008 3.6 0.8 2.9 0.4 8.0
2009 9.2 2.0 7.2 0.6 12.0
2010 115.0 7.8 107.2 5.9 18.2
2011 94.7 10.7 84.0 6.6 12.7
2012 122.2 21.5 100.7 6.7 15.0
2013 62.7 11.1 51.6 9.4 5.5
Fig. 4.19
2013 Venture-Backed IPOs Valuations as of IPOs
Year
of
IPO
Avg Val
($ Mil)
Max
($ Mil)
Upper
Quartile
($ Mil)
Median
($ Mil)
Lower
Quartile
($ Mil)
Min
($ Mil)
1995 152.0 2,128.6 144.8 104.2 61.4 10.4
1996 239.6 9,989.8 183.4 111.6 65.2 9.5
1997 148.1 1,106.3 161.1 99.3 57.2 6.6
1998 324.4 4,623.9 288.0 163.9 106.9 7.1
1999 531.9 10,203.2 537.0 303.7 186.7 5.9
2000 494.5 4,227.7 550.7 325.4 185.0 1.7
2001 534.2 3,464.1 617.7 326.6 158.6 46.6
2002 346.7 822.4 537.8 266.2 175.6 36.8
2003 285.1 821.9 353.2 251.9 171.2 41.9
2004 613.0 23,053.7 389.2 254.1 152.3 21.6
2005 672.9 22,422.9 392.2 201.9 136.6 4.6
2006 1,077.6 39,248.4 529.2 283.2 179.9 70.9
2007 749.5 14,035.4 762.8 364.7 274.1 50.0
2008 520.7 1,443.1 713.2 278.5 210.7 75.8
2009 707.1 1,622.0 852.5 547.9 313.0 212.9
2010 1,642.6 23,725.8 1,419.9 428.1 222.7 23.4
2011 1,856.0 16,465.6 1,496.6 606.3 336.2 94.8
2012 2,493.2 81,247.2 704.0 371.0 247.3 75.2
2013 783.8 14,435.1 587.8 354.1 212.7 42.9
Note: To be included in this chart, non-US based companies must be
trading on a US exchange/market and have at least one US venture fund
investor.
GROWTH EQUITY INVESTMENTS
This edition of the NVCA Yearbook, prepared by Thomson Reuters, for the frst time profles US growth equity investment in its own chapter. The NVCA
believes growth equity investing is an important segment of the overall venture capital industry. Venture capitalists help create and grow companies;
growth equity investors are strongly focused on the growth component of that mission and help companies scale through fat part of their hiring curves.
The NVCA also believes that growth equity investing is a critical component of the emerging growth company fnancing continuum and has become,
in many respects, the private alternative to the public markets for both emerging growth companies and their earlier stage venture capital backers.
Growth equity really emerged as an asset class in 2000 and continues
strong today. In 2013, we identifed 342 growth equity deals in the United
States. This compares with 406 in 2012, but is very much in line with
the past several years. A disclosed $12.3 billion in equity investment was
reported for 2013. This does not count the approximately 105 deals for
which no dollar equity amounts were disclosed.
An analysis of the charts in this chapter helps profle the growth equity
activity. Approximately 38% of disclosed equity dollars went to Califor-
nia companies. This compares with 50% of traditional venture capital dol-
lars going to California companies.
As with traditional venture capital, the sector receiving the most dol-
lars through the most deals is Software. By count, 148 of the 342 deals,
or 43%, were into software companies. By contrast, no other MoneyTree
sector garnered more than 10% of the total number of deals.
The defnition of a growth equity company:
Companys revenues are growing rapidly
Company is cash fow positive, proftable or approaching proft-
ability
Company is often founder-owned and/or managed
Investor is agnostic about taking a controlling position and usually
purchases minority ownership position
Industry investment mix is similar to that of earlier stage venture
capital investors
Capital is used for company needs or shareholder liquidity
Additional fnancing rounds are not usually expected until exit
Investments are unlevered or use light leverage at purchase
Investment returns are primarily a function of growth, not leverage
Methodology
The growth equity asset class really emerged after the 2000 tech bubble.
Therefore, our statistics begin in 2000. These growth equity transactions
for the most part were already captured in the Thomson One database. But
they were, and still are, reported under the respective venture capital or
buyout categories. For purposes of this chapter, they are aggregated and
reported as if they were a standalone dataset.
While still nascent in its application, our 2014 Yearbook methodology
for tagging growth equity transactions from the full venture capital/buy-
out database bears some explanation. We expect these criteria to mature
over time as we gain more experience defning the asset class. For now:
Date: 1/1/2000 and later
Equity dollar amount invested: Zero (not disclosed) or more than$15
million
Geographic location of company: United States
Deal stage: expansion, later stage, acquisition for expansion, ac-
quisition, LBO, mezzanine, MBO, recap or turnaround, secondary
buyout, secondary purchase
Firms investing: Must include at least one frm from a list of 65
known, active growth equity investors
It should also be noted that the dollar value of many of these growth
equity transactions are not disclosed, so therefore the dollar amounts re-
ported in the charts will understate the amount of equity investment made
by growth equity frms. For this chapter, we have excluded equity invest-
ment reported from $1 to $14.99 million, because growth equity deals
tend to be larger in size.
Also, unlike traditional venture capital portfolio companies that enter
the portfolios with smaller and earlier stage rounds and exit with an IPO,
acquisition, or failure, growth equity-backed companies enter those port-
folios with more maturity, and, presumably, with a shorter track to liquid-
ity.
Figure 5.01
Growth Equity Investments ($ Billions)
2000 to 2013*
0
5
10
15
20
25
30
2
0
0
0

2
0
0
1

2
0
0
2

2
0
0
3

2
0
0
4

2
0
0
5

2
0
0
6

2
0
0
7

2
0
0
8

2
0
0
9

2
0
1
0

2
0
1
1

2
0
1
2

2
0
1
3

(
$

B
i
l
l
i
o
n
s
)

Year
Software
34%
Computers and Peripherals
21%
10%
Industrial/Energy
8%
Consumer Products and Services
6%
IT Services
5%
Financial Services
3%
Medical Devices and Equipment
2%
Biotechnology
2%
Telecommunications
2%
Healthcare Services
1%
Semiconductors
1%
Retailing/Distribution 1%
Business Products and Services
1%
1%
1%
Figure 5.02
Growth Equity Investments By Industry Sector
Fig. 5.03
Growth Equity Investments
By Company State*
State # Companies # Deals Amt. Invested ($Bil)
California 153 141 4,677.6
Texas 27 25 3,368.8
New York 35 33 1,060.6
Massachusetts 21 20 650.4
Georgia 11 10 300.3
Total* 247 229 10,057.8
*Total includes top 5 states only
Figure 5.04
Growth Equity Investments 2000-2013 By Industry ($ Millions)*
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 797.01 361 551 743 781 959 829 1,098 819 298 398 409 489 240
Services
612.08 222 444 75 154 139 158 368 2,451 94 83 41 - 137
Computers and
Peripherals
778.08 136 196 88 187 122 83 97 55 - 73 118 261 2,549
Consumer Products
and Services
839.55 186 221 176 739 61 1,224 448 93 228 442 987 924 747
Electronics/
Instrumentation
197.00 83 30 96 96 110 164 251 212 164 115 123 129 72
Financial Services 1,304.76 224 66 296 672 914 464 316 482 249 1,904 94 198 410
Healthcare Services 221.88 48 99 175 270 145 149 274 129 383 194 287 161
Industrial/Energy 728.69 53 312 121 325 2,519 622 1,304 1,239 996 1,147 1,856 1,162 927
IT Services 2,678.90 595 323 71 178 3,700 528 785 814 670 457 1,151 685 666
Media and
Entertainment
2,007.22 607 215 458 589 297 487 1,020 713 1,061 1,127 1,848 794 1,277
Medical Devices and
Equipment
395.22 571 482 240 447 485 531 1,050 875 469 963 1,217 284 290
Networking and
Equipment
4,240.43 2,500 1,226 570 532 654 414 590 268 176 441 199 696 100
Other - - 46 - 130 266 - 350 306 - 52 - - -
Retailing/Distribution 860.80 79 193 - 55 103 - 207 107 44 30 392 154 143
Semiconductors 944.95 622 407 461 478 528 3,049 665 357 89 365 504 289 161
Software 6,409.81 2,298 825 1,011 2,079 1,471 2,526 1,358 3,034 1,058 1,316 3,645 3,695 4,229
Telecommunications 5,727.49 1,471 1,008 619 781 1,375 1,268 913 430 531 285 185 325 220
Total 28,743.86 10,055.40 6,643.83 5,200.68 8,490.98 13,848.92 12,493.56 11,094.65 12,384.40 6,127.02 9,579.65 12,961.99 10,370.76 12,329.17
Figure 5.05
Growth Equity Investments 2000-2013 By Industry (Number of Deals)*
Industry 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Biotechnology 22 11 16 22 32 30 25 37 32 12 17 13 18 14
Services
20 9 3 2 6 9 11 14 13 9 10 7 9 13
Computers and
Peripherals
12 4 6 3 8 5 4 6 2 3 7 7 9
Consumer Products
and Services
27 6 7 5 10 11 13 23 10 10 14 24 27 16
Electronics/
Instrumentation
6 1 1 3 4 4 6 10 7 5 6 5 6 3
IT Services 76 24 15 6 12 17 27 54 43 33 33 53 35 33
Media and
Entertainment
65 15 4 13 17 12 23 32 35 27 30 35 41 31
Medical Devices and
Equipment
15 19 19 13 18 23 21 38 34 14 29 20 14 13
Networking and
Equipment
80 63 32 25 21 23 16 21 14 8 20 11 8 3
Other - - 1 - 4 5 4 11 4 1 1 - - -
Semiconductors 27 21 17 16 23 27 27 28 16 5 14 19 10 8
Software 203 86 42 32 62 58 64 83 87 57 91 117 168 148
Total 713 317 205 183 286 281 308 454 386 235 353 388 406 342
Figure 5.06
Growth Equity Investments 2000-2013 By MoneyTree Region ($ Millions)*
State 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Silicon Valley 11,021 2,966 1,852 1,347 1,988 2,121 2,060 2,849 3,385 2,675 3,396 5,207 4,151 4,062
Texas 1,968 1,072 594 522 1,246 1,048 3,121 738 521 101 432 1,974 332 3,369
NY Metro 2,342 808 320 270 920 3,415 1,404 1,233 815 455 750 1,274 679 1,112
New England 3,976 1,811 556 742 890 576 846 1,329 950 285 1,882 585 709 828
Southeast 1,773 426 674 571 478 481 2,127 464 1,293 828 644 365 581 656
LA/Orange County 1,421 417 284 323 630 658 1,036 1,076 651 200 659 1,398 1,149 496
DC/Metroplex 1,239 786 307 278 375 463 229 341 436 98 278 515 435 377
Midwest 1,163 428 862 210 375 253 320 645 272 362 588 849 555 377
SouthWest 197 89 153 30 480 128 217 727 212 55 60 181 345 255
Northwest 993 320 113 159 300 254 276 427 134 243 420 105 394 219
North Central 310 96 20 113 153 160 109 123 2,409 70 56 - 68 181
San Diego 404 229 137 119 182 277 441 286 241 233 106 198 98 120
Philadelphia Metro 453 212 416 287 261 3,674 139 345 234 218 229 94 143 109
South Central 42 36 - - - 45 - - - 150 17 35 173 83
Colorado 1,232 331 138 230 126 245 139 446 831 154 38 105 560 70
Upstate NY - - 190 - 85 - 30 47 - - 24 63 - 16
AK/HI/PR 190 - - - - - - - - - - - - -
Sacramento/N.Cal 19 30 27 - - 50 - 19 - - - 16 - -
Total 28,743 10,055 6,644 5,201 8,491 13,849 12,494 11,095 12,384 6,126 9,580 12,963 10,371 12,329
Figure 5.07
Growth Equity Investments 2000-2013 By MoneyTree Region (Number of Deals)*
State 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Silicon Valley 274 98 69 53 85 82 83 121 141 70 136 144 143 125
NY Metro 44 23 10 12 16 30 32 49 36 25 36 49 41 41
Southeast 38 15 21 17 18 20 25 29 30 19 22 19 22 28
Texas 46 33 16 18 24 15 23 33 24 16 25 29 21 27
LA/Orange County 38 12 13 8 15 21 26 39 24 11 26 27 26 25
New England 108 57 22 32 40 28 32 53 32 21 19 30 33 25
Midwest 29 11 9 8 13 9 19 33 17 17 21 27 37 17
DC/Metroplex 38 22 11 6 19 15 13 21 21 12 18 17 22 11
SouthWest 6 3 5 2 12 7 8 10 9 6 5 2 13 10
Colorado 16 6 4 4 4 6 5 14 9 7 9 6 10 7
North Central 12 4 3 5 6 8 4 7 9 5 8 2 6 7
Northwest 30 11 6 5 16 11 11 12 10 9 11 12 14 7
Philadelphia Metro 16 9 6 7 9 13 12 13 14 8 7 12 9 5
San Diego 13 9 6 6 7 13 10 12 8 8 6 7 4 3
South Central 3 2 - - - 1 3 2 1 1 3 2 3 3
Upstate NY - - 2 - 2 1 1 2 - - 1 2 - 1
AK/HI/PR 1 1 - - - - - 2 1 - - - - -
Sacramento/N.Cal 1 1 2 - - 1 1 2 - - - 1 2 -
Total 713 317.0 205.0 183.0 286.0 281.0 308.0 454.0 386.0 235.0 353.0 388.0 406.0 342.0
*Data used for the Growth Equity charts is based on the following criteria: The investment dollar totals include investments in US-based companies
that are relevant to Growth Equity (Expansion, Later Stage, Acq. for Expansion, Acquisition, LBO, Mezzanine, MBO, Recap or Turnaround, Second-
ary Buyout, Secondary Purchase), with a total equity investment amount of $15 million and up, and participation from at least one frm classifed as a
Growth Equity investor. Participating frms include the following: 3i, 3i Group PLC, ABS Capital Partners, Inc., Accel Partners & Co Inc, Adams Street
Partners LLC, Andreessen Horowitz LLC, Apax Partners LLP, Austin Ventures LP, Bain Capital Venture Partners LLC, Battery Ventures LP, Bessemer
Venture Partners LP, Bregal Capital LLP, Carrick Capital Management Company LLC, Catalyst Investors LLC, Catterton Partners Corp, Chicago
Growth Partners, Columbia Capital, Columbia Capital Group, Inc., Edison Ventures, Francisco Partners LP, Frazier Healthcare, FTV Capital, General
Atlantic LLC, General Catalyst Partners LLC, GGV Capital, Great Hill Equity Partners LLC, Highland Capital Partners LLC, Insight Venture Partners
LLC, Institutional Venture Partners, JMI Equity, Kennet Venture Partners Ltd, Kleiner Perkins Caufeld & Byers LLC, Level Equity, LLR Partners Inc,
M/C Partners, Mainsail Partners LP, Meritech Capital Partners, New Enterprise Associates, Inc., Newspring Capital, Noro-Moseley Partners, North
Bridge Venture Partners L P, Norwest Venture Partners, Oak Investment Partners, Pine Brook Road Partners LLC, Polaris Partners, Redpoint Ventures,
Rho Capital Partners Inc, Sequoia Capital, Serent Capital LLC, Silver Lake Partners LP, Spectrum Equity, Stripes Group LLC, Summit Partners LP,
Susquehanna Growth Equity LLC, Symmetric Capital, TA Associates Management, L.P., Trident Capital, Updata Partners, Volition Capital LLC,
Weston Presidio Capital, WestView Capital Partners, Duff Ackerman & Goodrich LLC, Draper Fisher Jurvetson International Inc, Draper Fisher Jur-
vetson Gotham Venture Partners, Draper Fisher Jurvetson New England (AKA DFJ/NE), Technology Crossover Ventures, Revolution Ventures LLC,
Element Partners, Riveria Investment Group. Company and deal counts include Growth Equity transactions with disclosed and undisclosed equity
investment totals.
APPENDIX A
Glossary
A round a fnancing event whereby angel groups and / or
venture capitalists become involved in a fast growth company that
was previously fnanced by founders and their friends and families.
Accredited investor a person or legal entity, such as a company
or trust fund, that meets certain net worth and income qualifcations
and is considered to be suffciently sophisticated to make investment
decisions in private offerings. Regulation D of the Securities Act of
1933 exempts accredited investors from protection of the Securities
Act. The Securities and Exchange Commission has proposed
revisions to the accredited investor qualifying rules, which may or
may not result in changes for venture investors. The current criteria
for a natural person are: $1 million net worth or annual income
exceeding $200,000 individually or $300,000 with a spouse.
Directors, general partners and executive offcers of the issuer are
considered to be accredited investors.
Alternative asset class a class of investments that includes
venture capital, leverage buyouts, hedge funds, real estate, and oil
and gas, but excludes publicly traded securities. Pension plans,
college endowments and other relatively large institutional investors
typically allocate a certain percentage of their investments to
alternative assets with an objective to diversify their portfolios.
Alpha a term derived from statistics and fnance theory that is
used to describe the return produced by a fund manager in excess of
the return of a benchmark index. Manager returns and benchmark
returns are measured net of the risk-free rate. In addition, manager
returns are adjusted for the risk of the managers portfolio relative to
the risk of the benchmark index. Alpha is a proxy for manager skill.
Angel a wealthy individual that invests in companies in relatively
early stages of development. Usually angels invest less than $1
million per startup.
Anti-dilution a contract clause that protects an investor from a
substantial reduction in percentage ownership in a company due to
the issuance by the company of additional shares to other entities.
The mechanism for making an adjustment that maintains the same
percentage ownership is called a Full Ratchet. The most commonly
used adjustment provides partial protection and is called Weighted
Average.
B round a fnancing event whereby investors such as venture
capitalists and organized angel groups are suffciently interested
in a company to provide additional funds after the A round of
fnancing. Subsequent rounds are called C, D and so on.
Basis point (bp) one one-hundredth (1/100) of a percentage
unit. For example, 50 basis points equals one half of one percent.
Banks quote variable loan rates in terms of an index plus a margin
and the margin is often described in basis points, such as LIBOR
plus 400 basis points (or, as the experts say, beeps).
Beta a measure of volatility of a public stock relative to an index
or a composite of all stocks in a market or geographical region.
A beta of more than one indicates the stock has higher volatility
than the index (or composite) and a beta of one indicates volatility
equivalent to the index (or composite). For example, the price of
a stock with a beta of 1.5 will change by 1.5% if the index value
changes by 1%. Typically, the S&P500 index is used in calculating
the beta of a stock.
Beta product a product that is being tested by potential customers
prior to being formally launched into the marketplace.
Board of directors a group of individuals, typically composed of
managers, investors and experts who have a fduciary responsibility
for the well being and proper guidance of a corporation. The board
is elected by the shareholders.
Book see Private placement memorandum.
Bootstrapping the actions of a startup to minimize expenses and
build cash fow, thereby reducing or eliminating the need for outside
investors.
Bp see Basis point.
Bridge fnancing temporary funding that will eventually be
replaced by permanent capital from equity investors or debt lenders.
In venture capital, a bridge is usually a short term note (6 to 12
months) that converts to preferred stock. Typically, the bridge lender
has the right to convert the note to preferred stock at a price that is
a 20% to 25% discount from the price of the preferred stock in the
next fnancing round. See Mezzanine and Wipeout bridge.
Broad-based weighted average anti-dilution A weighted
average anti-dilution method adjusts downward the price per
share of the preferred stock of investor A due to the issuance of
new preferred shares to new investor B at a price lower than the
price investor A originally received. Investor As preferred stock is
repriced to a weighted average of investor As price and investor
Bs price. A broad-based anti-dilution method uses all common
stock outstanding on a fully diluted basis (including all convertible
securities, warrants and options) in the denominator of the formula
for determining the new weighted average price. See Narrow-based
weighted average anti-dilution.
Burn rate the rate at which a startup with little or no revenue uses
available cash to cover expenses. Usually expressed on a monthly
or weekly basis.
Business Development Company (BDC) a publicly traded
company that invests in private companies and is required by
law to provide meaningful support and assistance to its portfolio
companies.
Business plan a document that describes a new concept for
a business opportunity. A business plan typically includes the
following sections: executive summary, market need, solution,
technology, competition, marketing, management, operations, exit
strategy, and fnancials (including cash fow projections). For most
venture capital funds fewer than 10 of every 100 business plans
received eventually receive funding.
Buyout a sector of the private equity industry. Also, the purchase
of a controlling interest of a company by an outside investor (in a
leveraged buyout) or a management team (in a management buyout).
Buy-sell agreement a contract that sets forth the conditions under
which a shareholder must frst offer his or her shares for sale to the
other shareholders before being allowed to sell to entities outside
the company.
C Corporation an ownership structure that allows
any number of individuals or companies to own shares. A C
corporation is a stand-alone legal entity so it offers some protection
to its owners, managers and investors from liability resulting from
its actions.
Capital Asset Pricing Model (CAPM) a method of estimating
the cost of equity capital of a company. The cost of equity capital
is equal to the return of a risk-free investment plus a premium that
refects the risk of the companys equity.
Capital call when a private equity fund manager (usually a
general partner in a partnership) requests that an investor in the
fund (a limited partner) provide additional capital. Usually a
limited partner will agree to a maximum investment amount and the
general partner will make a series of capital calls over time to the
limited partner as opportunities arise to fnance startups and buyouts.
Capital gap the diffculty faced by some entrepreneurs in trying to
raise between $2 million and $5 million. Friends, family and angel
investors are typically good sources for fnancing rounds of less than
$2 million, while many venture capital funds have become so large
that investments in this size range are diffcult.
Capitalization table a table showing the owners of a companys
shares and their ownership percentages as well as the debt holders.
It also lists the forms of ownership, such as common stock, preferred
stock, warrants, options, senior debt, and subordinated debt.
Capital gains a tax classifcation of investment earnings resulting
from the purchase and sale of assets. Typically, a companys
investors and founders have earnings classifed as long term capital
gains (held for a year or longer), which are taxed at a lower rate than
ordinary income.
Capital stock a description of stock that applies when there is only
one class of shares. This class is known as common stock.
Capital Under Management A frequently-used metric for sizing
total funds managed by a venture capital or buyout frm. In practice,
there are several ways of calculating this. In the US, this is the
total committed capital for all funds managed by a frm on which it
collects management fees. This calculation ignores whether portions
of the committed capital have not yet been called and whether
portions of the fund have been liquidated and distributed. It typically
does not include aging funds in their out years on which fees are
not being collected. For purposes of this book in calculating capital
managed in fgure 1.04, because direct data is not available, the last
eight vintage years of capital commitments is considered a proxy for
the industrys total capital under management.
Capped participating preferred stock preferred stock whose
participating feature is limited so that an investor cannot receive
more than a specifed amount. See Participating preferred stock.
Carried interest the share in the capital gains of a venture capital
fund which is allocated to the General Partner. Typically, a fund must
return the capital given to it by limited partners plus any preferential
rate of return before the general partner can share in the profts of
the fund. The general partner will typically receive a 20% carried
interest, although some successful frms receive 25%-30%. Also
known as carry or promote.
Clawback a clause in the agreement between the general partner
and the limited partners of a private equity fund. The clawback gives
limited partners the right to reclaim a portion of disbursements to a
general partner for proftable investments based on signifcant losses
from later investments in a portfolio.
Closing the conclusion of a fnancing round whereby all necessary
legal documents are signed and capital has been transferred.
Club deal the act of investing by two or more entities in the same
target company, usually involving a leveraged buyout transaction.
Co-investment the direct investment by a limited partner alongside
a general partner in a portfolio company.
Collateral hard assets of the borrower, such as real
estate or equipment, for which a lender has a legal interest until a
loan obligation is fully paid off.
Commitment an obligation, typically the maximum amount that a
limited partner agrees to invest in a fund. See Capital call.
Common stock a type of security representing ownership rights
in a company. Usually, company founders, management and
employees own common stock while investors own preferred stock.
In the event of a liquidation of the company, the claims of secured
and unsecured creditors, bondholders and preferred stockholders
take precedence over common stockholders. See Preferred stock.
Comparable a private or public company with similar
characteristics to a private or public company that is being valued.
For example, a telecommunications equipment manufacturer whose
market value is 2 times revenues can be used to estimate the value
of a similar and relatively new company with a new product in the
same industry. See Liquidity discount.
Control the authority of an individual or entity that
owns more than 50% of equity in a company or owns the largest
block of shares compared to other shareholders.
Consolidation see Rollup.
Conversion the right of an investor or lender to force a company
to replace the investors preferred shares or the lenders debt with
common shares at a preset conversion ratio. A conversion feature
was frst used in railroad bonds in the 1800s.
Convertible debt a loan which allows the lender to
exchange the debt for common shares in a company at a preset
conversion ratio. Also known as a convertible note.
Convertible preferred stock a type of stock that gives an owner
the right to convert to common shares of stock. Usually, preferred
stock has certain rights that common stock doesnt have, such
as decision-making management control, a promised return on
investment (dividend), or senior priority in receiving proceeds from
a sale or liquidation of the company. Typically, convertible preferred
stock automatically converts to common stock if the company
makes an initial public offering (IPO). Convertible preferred is the
most common tool for private equity funds to invest in companies.
Co-sale right a contractual right of an investor to sell some of the
investors stock along with the founders or majority shareholders
stock if either the founder or majority shareholder elects to sell stock
to a third-party. Also known as Tag-along right.
Cost of capital see Weighted average cost of capital.
Cost of revenue the expenses generated by the core operations of
a company.
Covenant a legal promise to do or not do a certain
thing. For example, in a fnancing arrangement, company
management may agree to a negative covenant,
whereby it promises not to incur additional debt. The
penalties for violation of a covenant may vary from repairing the
mistake to losing control of the company.
Coverage ratio describes a companys ability to pay debt from
cash fow or profts. Typical measures are EBITDA/Interest,
(EBITDA minus Capital Expenditures)/Interest, and EBIT/Interest.
Cram down round a fnancing event upon which new investors
with substantial capital are able to demand and receive contractual
terms that effectively cause the issuance of suffcient new shares by
the startup company to signifcantly reduce (dilute) the ownership
percentage of previous investors.
Cumulative dividends the owner of preferred stock with
cumulative dividends has the right to receive accrued (previously
unpaid) dividends in full before dividends are paid to any other
classes of stock.
Current ratio the ratio of current assets to current liabilities.
Data room a specifc location where potential buyers / investors
can review confdential information about a target company. This
information may include detailed fnancial statements, client
contracts, intellectual property, property leases, and compensation
agreements.
Deal fow a measure of the number of potential investments that a
fund reviews in any given period.
Defned beneft plan a company retirement plan in which the
benefts are typically based on an employees salary and number of
years worked. Fixed benefts are paid after the employee retires. The
employer bears the investment risk and is committed to providing
the benefts to the employee. Defned beneft plan managers can
invest in private equity funds.
Defned contribution plan a company retirement plan in which
the employee elects to contribute some portion of his or her salary
into a retirement plan, such as a 401(k) or 403(b). The employer
may also contribute to the employees plan. With this type of plan,
the employee bears the investment risk. The benefts depend solely
on the amount of money made from investing the employees
contributions.
Demand rights a type of registration right. Demand rights give an
investor the right to force a startup to register its shares with the SEC
and prepare for a public sale of stock (IPO).
Dilution the reduction in the ownership percentage of current
investors, founders and employees caused by the issuance of new
shares to new investors.
Dilution protection see Anti-dilution and Full ratchet.
Direct secondary transaction A transaction in which the buyer
purchases shares of an operating company from an existing seller.
While the transaction is a secondary sale of shares, the transacted
interest is a primary issue purchase directly into an operating
company. Sellers are often venture capitalists selling their ownership
stake in a portfolio company. Buyers are often funds that specialize
in such investments.
Disbursement an investment by a fund in a company.
Discount rate the interest rate used to determine the present value
of a series of future cash fows.
Discounted cash fow (DCF) a valuation methodology whereby
the present value of all future cash fows expected from a company
is calculated.
Distressed debt the bonds of a company that is either in or
approaching bankruptcy. Some private equity funds specialize
in purchasing such debt at deep discounts with the expectation of
exerting infuence in the restructuring of the company and then
selling the debt once the company has meaningfully recovered.
Distribution the transfer of cash or securities to a limited partner
resulting from the sale, liquidation or
IPO of one or more portfolio companies in which a general partner
chose to invest.
Dividends payments made by a company to the owners of certain
securities. Typically, dividends are paid quarterly, by approval of the
board of directors, to owners of preferred stock.
Down round a round of fnancing whereby the valuation of the
company is lower than the value determined by investors in an
earlier round.
Drag-along rights the contractual right of an investor in a
company to force all other investors to agree to a specifc action,
such as the sale of the company.
Drawdown schedule an estimate of the gradual transfer of
committed investment funds from the limited partners of a private
equity fund to the general partners.
Due diligence the investigatory process performed by investors to
assess the viability of a potential investment and the accuracy of the
information provided by the target company.
Dutch auction a method of conducting an IPO where-by newly
issued shares of stock are committed to the highest bidder, then, if
any shares remain, to the next highest bidder, and so on until all
the shares are committed. Note that the price per share paid by all
buyers is the price commitment of the buyer of the last share.
Early stage the state of a company after the seed (formation)
stage but before middle stage (generating revenues). Typically, a
company in early stage will have a core management team and a
proven concept or product, but no positive cash fow.
Earnings before interest and taxes (EBIT) a measurement of the
operating proft of a company. One possible valuation methodology
is based on a comparison of private and public companies value as
a multiple of EBIT.
Earnings before interest, taxes, depreciation and amortization
(EBITDA) a measurement of the cash fow of a company. One
possible valuation methodology is based on a comparison of private
and public companies value as a multiple of EBITDA.
Earn out an arrangement in which sellers of a business receive
additional future payments, usually based on fnancial performance
metrics such as revenue or net income.
Elevator pitch a concise presentation, lasting only a few minutes
(an elevator ride), by an entrepreneur to a potential investor about an
investment opportunity.
Employee Stock Ownership Program (ESOP) a plan established
by a company to reserve shares for employees.
Entrepreneur an individual who starts his or her own business.
Entrepreneurship the application of innovative leadership to
limited resources in order to create exceptional value.
Enterprise Value (EV) the sum of the market values of the
common stock and long term debt of a company, minus excess cash.
Equity the ownership structure of a company represented by
common shares, preferred shares or unit interests. Equity = Assets
Liabilities.
ESOP see Employee Stock Ownership Program.
Evergreen fund a fund that reinvests its profts in order to ensure
the availability of capital for future investments.
Exit strategy the plan for generating profts for owners and
investors of a company. Typically, the options are to merge, be
acquired or make an initial public offering (IPO). An alternative is
to recapitalize (releverage the company and then pay dividends to
shareholders).
Expansion stage the stage of a company characterized by a
complete management team and a substantial increase in revenues.
Fair value a fnancial reporting principle for valuing assets and
liabilities, for example, portfolio companies in venture capital fund
portfolio. In 2008, more defned rules took effect. See FAS 157.
Fairness opinion a letter issued by an investment bank that
charges a fee to assess the fairness of a negotiated price for a merger
or acquisition.
FAS 157 the original designation of an accounting
standard effective in 2008 for private companies for the fair
value measurement of portfolio holdings. Literally, Financial
Accounting Standard number 157, this standard is now offcially
Accounting Standard Codifcation Topic 820 (ASC 820) but
it is more widely known by its original name. In 2013-2014, the
Financial Accounting Foundation conducted a post-implementation
review of this standard to determine if it is working as intended.
First refusal the right of a privately owned company to purchase
any shares that employees would like to sell.
Founders stock nominally priced common stock issued to
founders, offcers, employees, directors, and consultants.
Free cash fow to equity (FCFE) the cash fow available after
operating expenses, interest payments on debt, taxes, net principal
repayments, preferred stock dividends, reinvestment needs and
changes in working capital. In a discounted cash fow model to
determine the value of the equity of a frm using FCFE, the discount
rate used is the cost of equity.
Free cash fow to the frm (FCFF) the operating cash fow
available after operating expenses, taxes, reinvestment needs and
changes in working capital, but before any interest payments on
debt are made. In a discounted cash fow model to determine the
enterprise value of a frm using FCFF, the discount rate used is the
weighted average cost of capital (WACC).
Friends and family fnancing capital provided by the friends
and family of founders of an early stage company. Founders should
be careful not to create an ownership structure that may hinder the
participation of professional investors once the company begins to
achieve success.
Full ratchet an anti-dilution protection mechanism whereby
the price per share of the preferred stock of investor A is adjusted
downward due to the issuance of new preferred shares to new investor
B at a price lower than the price investor A originally received.
Investor As preferred stock is repriced to match the price of investor
Bs preferred stock. Usually as a result of the implementation of
a ratchet, company management and employees who own a fxed
amount of common shares suffer signifcant dilution. See Narrow-
based weighted average anti-dilution and Broad-based weighted
average anti-dilution.
Fully diluted basis a methodology for calculating any per share
ratios whereby the denominator is the total number of shares issued
by the company on the assumption that all warrants and options are
exercised and preferred stock.
Fund-of-funds a fund created to invest in private equity funds.
Typically, individual investors and relatively small institutional
investors participate in a fund-offunds to minimize their portfolio
management efforts.
Gatekeepers intermediaries which endowments, pension funds
and other institutional investors use as advisors regarding private
equity investments.
General partner (GP) a class of partner in a partnership. The
general partner retains liability for the actions of the partnership.
Historically, venture capital and buyout funds have been structured
as limited partnerships, with the venture frm as the GP and limited
partners (LPs) being the institutional and high net worth investors
that provide most of the capital in the partnership. The GP earns a
management fee and a percentage of gains (see Carried interest).
GP see General partner.
GP for hire In a spin-out or a synthetic secondary, a GP for hire
refers to the professional investor who may be hired by a purchasing
frm to manage the new fund created from the orphaned assets
purchased. In past cases, the GP has often expanded its role to
fundraise for and run new funds aside from the initial fund.
Going-private transaction when a public company chooses to
pay off all public investors, delist from all stock exchanges, and
become owned by management, employees, and select private
investors.
Golden handcuffs fnancial incentives that discourage founders
and / or important employees from leaving a company before a
predetermined date or important milestone.
Grossing up an adjustment of an option pool for management
and employees of a company which increases the number of shares
available over time. This usually occurs after a fnancing round
whereby one or more investors receive a relatively large percentage
of the company. Without a grossing up, managers and employees
would suffer the fnancial and emotional consequences of dilution,
thereby potentially affecting the overall performance of the company.
Growth stage the state of a company when it has received one or
more rounds of fnancing and is generating revenue from its product
or service. Also known as middle stage.
Hart-Scott-Rodino Act a law requiring entities that acquire certain
amounts of stock or assets of a company to inform the Federal Trade
Commission and the Department of Justice and to observe a waiting
period before completing the transaction.
Hedge fund an investment fund that has the ability to use
leverage, take short positions in securities, or use a variety of
derivative instruments in order to achieve a return that is relatively
less correlated to the performance of typical indices (such as the
S&P 500) than traditional long-only funds. Hedge fund managers
are typically compensated based on assets under management as
well as fund performance.
High yield debt debt issued via public offering or public
placement (Rule 144A) that is rated below investment grade by S&P
or Moodys. This means that the debt is rated below the top four
rating categories (i.e. S&P BB+, Moodys Ba2 or below). The lower
rating is indicative of higher risk of default, and therefore the debt
carries a higher coupon or yield than investment grade debt. Also
referred to as Junk bonds or Sub-investment grade debt.
Hockey stick the general shape and form of a chart showing
revenue, customers, cash or some other fnancial or operational
measure that increases dramatically at some point in the future.
Entrepreneurs often develop business plans with hockey stick charts
to impress potential investors.
Holding period amount of time an investment remains in a
portfolio.
Hot issue stock in an initial public offering that is in high demand.
Hot money capital from investors that have no tolerance for lack
of results by the investment manager and move quickly to withdraw
at the frst sign of trouble.
Hurdle rate a minimum rate of return required before an investor
will make an investment.
Incorporation the process by which a business receives a state
charter, allowing it to become a corporation. Many corporations
choose Delaware because its laws are business-friendly and up to date.
Incubator a company or facility designed to host startup
companies. Incubators help startups grow while controlling costs by
offering networks of contacts and shared backoffce resources.
Indenture the terms and conditions between a bond issuer and
bond buyers.
Initial public offering (IPO) the frst offering of stock by a
company to the public. New public offerings must be registered
with the Securities and Exchange Commission. An IPO is one of
the methods that a startup that has achieved signifcant success can
use to raise additional capital for further growth. See Qualifed IPO.
In-kind distribution a distribution to limited partners of a private
equity fund that is in the form of publicly trades shares rather than
cash.
Inside round a round of fnancing in which the investors are
the same investors as the previous round. An inside round raises
liability issues since the valuation of the company has no third
party verifcation in the form of an outside investor. In addition, the
terms of the inside round may be considered self-dealing if they are
onerous to any set of shareholders or if the investors give themselves
additional preferential rights.
Institutional investor professional entities that invest capital on
behalf of companies or individuals. Examples are: pension plans,
insurance companies and university endowments.
Intellectual property (IP) knowledge, techniques, writings and
images that are intangible but often protected by law via patents,
copyrights, and trademarks.
Interest coverage ratio earnings before interest and taxes (EBIT)
divided by interest expense. This is a key ratio used by lenders to
assess the ability of a company to produce suffcient cash to pay its
debt obligation.
Internal rate of return (IRR) the interest rate at which a certain
amount of capital today would have to be invested in order to grow
to a specifc value at a specifc time in the future.
Investment thesis / Investment philosophy the fundamental
ideas which determine the types of investments that an investment
fund will choose in order to achieve its fnancial goals.
IPEV Stands for International Private Equity Valuation guidelines
group. This group is made up of representatives of the international
and US venture capital industry and has published guidelines for
applying US GAAP and international IFRS valuation rules. See
www.privateequityvaluation.com. Widely regarded in the US as the
global successor to the US-focused PEIGG group.
IPO see Initial public offering.
IRR see Internal rate of return.
Issuer the company that chooses to distribute a portion of its stock
to the public.
J curve a concept that during the frst few years of a private equity
fund, cash fow or returns are negative due to investments, losses,
and expenses, but as investments produce results the cash fow or
returns trend upward. A graph of cash fow or returns versus time
would then resemble the letter J.
Later stage the state of a company that has proven its concept,
achieved signifcant revenues compared to its competition, and is
approaching cash fow break even or positive net income. Typically,
a later stage company is about 6 to 12 months away from a liquidity
event such as an IPO or buyout. The rate of return for venture
capitalists that invest in later stage, less risky ventures is lower than
in earlier stage ventures.
LBO see Leveraged buyout.
Lead investor the venture capital investor that makes the largest
investment in a fnancing round and manages the documentation and
closing of that round. The lead investor sets the price per share of the
fnancing round, thereby determining the valuation of the company.
Letter of intent a document confrming the intent of an investor
to participate in a round of fnancing for a company. By signing this
document, the subject company agrees to begin the legal and due
diligence process prior to the closing of the transaction. Also known
as a Term Sheet.
Leverage the use of debt to acquire assets, build operations and
increase revenues. By using debt, a company is attempting to achieve
results faster than if it only used its cash available from pre-leverage
operations. The risk is that the increase in assets and revenues does
not generate suffcient net income and cash fow to pay the interest
costs of the debt.
Leveraged buyout (LBO) the purchase of a company or a
business unit of a company by an outside investor using mostly
borrowed capital.
Leveraged recapitalization the reorganization of a companys
capital structure resulting in more debt added to the balance sheet.
Private equity funds can recapitalize a portfolio company and then
direct the company to issue a one-time dividend to equity investors.
This is often done when the company is performing well fnancially
and the debt markets are expanding.
Leverage ratios measurements of a companys debt as a multiple
of cash fow. Typical leverage ratios include Total Debt / EBITDA,
Total Debt / (EBITDA minus Capital Expenditures), and Seniore
Debt / EBITDA.
L.I.B.O.R. see The London Interbank Offered Rate.
License a contract in which a patent owner grants to a company the
right to make, use or sell an invention under certain circumstances
and for compensation.
Limited liability company (LLC) an ownership structure
designed to limit the founders losses to the
amount of their investment. An LLC itself does not pay taxes, rather
its owners pay taxes on their proportion of the LLC profts at their
individual tax rates.
Limited partnership a legal entity composed of a general partner and
various limited partners. The general partner manages the investments
and is liable for the actions of the partnership while the limited partners
are generally protected from legal actions and any losses beyond their
original investment. The general partner collects a management fee
and earns a percentage of capital gains (see Carried interest), while the
limited partners receive income, capital gains and tax benefts.
Limited partner (LP) an investor in a limited partnership. The
general partner is liable for the actions of the partnership while the
limited partners are generally protected from legal actions and any
losses beyond their original investment. The limited partner receives
income, capital gains and tax benefts.
Liquidation the sale of a company. This may occur in the context
of an acquisition by a larger company or in the context of selling off
all assets prior to cessation of operations (Chapter 7 bankruptcy).
In a liquidation, the claims of secured and unsecured creditors,
bondholders and preferred stockholders take precedence over
common stockholders.
Liquidation preference the contractual right of an investor to
priority in receiving the proceeds from the
liquidation of a company. For example, a venture capital investor
with a 2x liquidation preference has the right to receive two times
its original investment upon liquidation.
Liquidity discount a decrease in the value of a private company
compared to the value of a similar but publicly traded company.
Since an investor in a private company cannot readily sell his or her
investment, the shares in the private company must be valued less
than a comparable public company.
Liquidity event a transaction whereby owners of a signifcant
portion of the shares of a private company sell their shares in
exchange for cash or shares in another, usually larger company. For
example, an IPO is a liquidity event.
Lock-up agreement investors, management and employees often
agree not to sell their shares for a specifc time period after an IPO,
usually 6 to 12 months. By avoiding large sales of its stock, the
company has time to build interest among potential buyers of its
shares.
London Interbank Offered Rate (L.I.B.O.R.) the average rate
charged by large banks in London for loans to each other. LIBOR is
a relatively volatile rate and is typically quoted in maturities of one
month, three months, six months and one year.
Management buyout (MBO) a leveraged buyout controlled by
the members of the management team of a company or a division.
Often an MBO is conducted in partnership with a buyout fund.
Management fee a fee charged to the limited partners in a fund
by the general partner. Management fees in a private equity fund
usually range from 0.75% to 3% of capital under management,
depending on the type and size of fund. For venture capital funds,
2% is typical.
Management rights the rights often required by a venture
capitalist as part of the agreement to invest in a company. The
venture capitalist has the right to consult with management on key
operational issues, attend board meetings and review information
about the companys fnancial situation.
Market capitalization the value of a publicly traded company as
determined by multiplying the number of shares outstanding by the
current price per share.
MBO see Management buyout.
Mezzanine a layer of fnancing that has intermediate priority
(seniority) in the capital structure of a company. For example,
mezzanine debt has lower priority than senior debt but usually has a
higher interest rate and often includes warrants. In venture capital, a
mezzanine round is generally the round of fnancing that is designed
to help a company have enough resources to reach an IPO. See
Bridge fnancing.
MoneyTree Report Offcially known as The MoneyTree Report
from PricewaterhouseCoopers and the National Venture Capital
Association based on data provided by Thomson Reuters. This report
provides much of the data in this report. It is used for investment
statistics in United States based companies. Specifc defnition
information is available in several of the appendices of this Yearbook.
Multiples a valuation methodology that compares public and
private companies in terms of a ratio of value to an operations fgure
such as revenue or net income. For example, if several publicly
traded computer hardware companies are valued at approximately
2 times revenues, then it is reasonable to assume that a startup
computer hardware company that is growing fast has the potential to
achieve a valuation of 2 times its revenues. Before the startup issues
its IPO, it will likely be valued at less than 2 times revenue because
of the lack of liquidity of its shares. See Liquidity discount.
Narrow-based weighted average anti-dilution a type of anti-
dilution mechanism. A weighted average
anti-dilution method adjusts downward the price per share of the
preferred stock of investor A due to the issuance of new preferred
shares to new investor B at a price lower than the price investor
A originally received. Investor As preferred stock is repriced to
a weighed average of investor As price and investor Bs price. A
narrow-based anti-dilution uses only common stock outstanding in
the denominator of the formula for determining the new weighted
average price.
NDA see Non-disclosure agreement.
No-shop clause a section of an agreement to purchase a company
whereby the seller agrees not to market the company to other
potential buyers for a specifc time period.
Non-cumulative dividends dividends that are payable to owners
of preferred stock at a specifc point in time only if there is suffcient
cash fow available after all company expenses have been paid. If
cash fow is insuffcient, the owners of the preferred stock will not
receive the dividends owed for that time period and will have to wait
until the board of directors declares another set of dividends.
Non-interference an agreement often signed by employees and
management whereby they agree not to interfere with the companys
relationships with employees, clients, suppliers and sub-contractors
within a certain time period after termination of employment.
Non-solicitation an agreement often signed by employees and
management whereby they agree not to solicit other employees of
the company regarding job opportunities.
Non-disclosure agreement (NDA) an agreement issued by
entrepreneurs to protect the privacy of their
ideas when disclosing those ideas to third parties.
Offering memorandum a legal document that provides details
of an investment to potential investors. See Private placement
memorandum.
OID see Original issue discount.
Operating cash fow the cash fow produced from the operation
of a business, not from investing activities (such as selling assets)
or fnancing activities (such as issuing debt). Calculated as net
operating income (NOI) plus depreciation.
Option pool a group of options set aside for long term, phased
compensation to management and employees.
Outstanding shares the total amount of common shares of a
company, not including treasury stock, convertible preferred stock,
warrants and options.
Pay to play a clause in a fnancing agreement whereby any
investor that does not participate in a future round agrees to suffer
signifcant dilution compared to other investors. The most onerous
version of pay to play is automatic conversion to common shares,
which in essence ends any preferential rights of an investor, such as
the right to infuence key management decisions.
Pari passu a legal term referring to the equal treatment of two or
more parties in an agreement. For example, a venture capitalist may
agree to have registration rights that are pari passu with the other
investors in a fnancing round.
Participating dividends the right of holders of certain preferred
stock to receive dividends and participate in additional distributions
of cash, stock or other assets.
Participating preferred stock a unit of ownership composed of
preferred stock and common stock. The preferred stock entitles the
owner to receive a predetermined sum of cash (usually the original
investment plus accrued dividends) if the company is sold or has an
IPO. The common stock represents additional continued ownership
in the company.
PEIGG acronym for Private Equity Industry Guidelines
Group, an ad hoc group of individuals and frms involved in the
private equity industry for the purpose of establishing valuation
and reporting guidelines. With the implementation of FAS 157 in
2008, the groups mission was essentially complete. Several of its
members then joined IPEV, which is viewed by US VCs as the
international successor to PEIGG.
Piggyback rights rights of an investor to have his or her shares
included in a registration of a startups shares in preparation for an
IPO.
PIK dividend a dividend paid to the holder of a stock, usually
preferred stock, in the form of additional stock rather than cash. PIK
refers to payment in kind.
PIPEs see Private investment in public equity.
Placement agent a company that specializes in fnding institutional
investors that are willing and able to invest in a private equity fund.
Sometimes a private equity fund will hire a placement agent so the
fund partners can focus on making and managing investments in
companies rather than on raising capital.
Portfolio company a company that has received an
investment from a private equity fund.
Post-money valuation the valuation of a company including the
capital provided by the current round of fnancing. For example, a
venture capitalist may invest $5 million in a company valued at $2
million pre-money (before the investment was made). As a result,
the startup will have a post-money valuation of $7 million.
PPM see Private placement memorandum.
Preemptive rights the rights of shareholders to maintain their
percentage ownership of a company by buying shares sold by the
company in future fnancing rounds.
Preference seniority, usually with respect to dividends and
proceeds from a sale or dissolution of a company.
Preferred return a minimum return per annum that must be
generated for limited partners of a private equity fund before the
general partner can begin receiving a percentage of profts from
investments.
Preferred stock a type of stock that has certain rights that common
stock does not have. These special rights may include dividends,
participation, liquidity preference, anti-dilution protection and veto
provisions, among others. Private equity investors usually purchase
preferred stock when they make investments in companies.
Pre-money valuation the valuation of a company prior to the
current round of fnancing. For example, a venture capitalist may
invest $5 million in a company valued at $2 million pre-money. As a
result, the startup will have a post-money valuation of $7 million.
Primary shares shares sold by a corporation (not by individual
shareholders).
Private Equity Growth Capital Council (PEGCC) an advocacy,
communications and research organization for the buyout industry
in the United States.
Private equity equity investments in non-public companies,
usually defned as being made up of venture capital funds and
buyout funds. Real estate, oil and gas, and other such partnerships
are sometimes included in the defnition.
Private investment in public equity (PIPEs) investments by
a private equity fund in a publicly traded company, usually at a
discount and in the form of preferred stock.
Private placement the sale of a security directly to a limited
number of institutional and qualifed individual investors. If
structured correctly, a private placement avoids registration with the
Securities and Exchange Commission.
Private placement memorandum (PPM) a document explaining
the details of an investment to potential investors. For example, a
private equity fund will issue a PPM when it is raising capital from
institutional investors. Also, a startup may issue a PPM when it
needs growth capital. Also known as Offering Memorandum.
Private securities securities that are not registered with the
Securities and Exchange Commission and do not trade on any
exchanges. The price per share is negotiated between the buyer and
the seller (the issuer).
Prudent man rule a fundamental principle for professional
money management which serves as a basis for the Prudent Investor
Act. The principle is based on a statement by Judge Samuel Putnum
in 1830: Those with the responsibility to invest money for others
should act with prudence, discretion, intelligence and regard for
the safety of capital as well as income. In the 1970s a favorable
interpretation of this rule enabled pension fund managers to invest
in venture capital for the frst time.
Qualifed IPO a public offering of securities valued at or above
a total amount specifed in a fnancing agreement. This amount is
usually specifed to be suffciently large to guarantee that the IPO
shares will trade in a major exchange (NASDAQ or New York
Stock Exchange). Usually upon a qualifed IPO preferred stock is
forced to convert to common stock.
Quartile one fourth of the data points in a data set. Often, private
equity investors are measured by the results of their investments
during a particular period of time. Institutional investors often prefer
to invest in private equity funds that demonstrate consistent results
over time, placing in the upper quartile of the investment results for
all funds.
Ratchet a mechanism to prevent dilution. An antidilution clause
in a contract protects an investor from a reduction in percentage
ownership in a company due to the future issuance by the company
of additional shares to other entities.
Realization ratio the ratio of cumulative distributions to paid-in
capital. The realization ratio is used as a measure of the distributions
from investment results of a private equity partnership compared to
the capital under management.
Recapitalization the reorganization of a companys capital
structure.
Red herring a preliminary prospectus fled with the Securities
and Exchange Commission and containing the details of an IPO
offering. The name refers to the disclosure warning printed in red
letters on the cover of each preliminary prospectus advising potential
investors of the risks involved.
Redemption rights the right of an investor to force
the startup company to buy back the shares issued as a result of the
investment. In effect, the investor has the right to take back his/her
investment and may even negotiate a right to receive an additional
sum in excess of the original investment.
Registration the process whereby shares of a company are
registered with the Securities and Exchange
Commission under the Securities Act of 1933 in preparation for a
sale of the shares to the public.
Regulation D Often referred to as simply Reg D, an SEC
regulation that governs private placements. Private placements
are investment offerings for institutional and accredited individual
investors, but not the general public.
Restricted shares shares that cannot be traded in the public
markets.
Return on investment (ROI) the proceeds from an investment,
during a specifc time period, calculated as a percentage of the
original investment. Also, net proft after taxes divided by average
total assets.
Rights offering an offering of stock to current shareholders that
entitles them to purchase the new issue, usually at a discount.
Rights of co-sale with founders a clause in venture capital
investment agreements that allows the VC fund to sell shares at the
same time that the founders of a startup chose to sell.
Right of frst refusal a contractual right to participate in a
transaction. For example, a venture capitalist may participate in
a frst round of investment in a startup and request a right of frst
refusal in any following rounds of investment.
Risk-free rate a term used in fnance theory to describe the return
from investing in a riskless security. In practice, this is often taken to
be the return on US Treasury Bills.
Road show presentations made in several cities to potential
investors and other interested parties. For example, a company will
often make a road show to generate interest among institutional
investors prior to its IPO.
ROI see Return on investment.
Rollup the purchase of relatively smaller companies in a sector
by a rapidly growing company in the same sector. The strategy is to
create economies of scale. For example, the movie theater industry
underwent signifcant consolidation in the 1960s and 1970s.
Round a fnancing event usually involving several
private equity investors.
Royalties payments made to patent or copyright owners in
exchange for the use of their intellectual property.
Rule 144 a rule of the Securities and Exchange Commission that
specifes the conditions under which the holder of shares acquired
in a private transaction may sell those shares in the public markets.
S corporation an ownership structure that limits its
number of owners to 100. An S corporation does not pay taxes,
rather its owners pay taxes on their proportion of the corporations
profts at their individual tax rates.
SBIC see Small Business Investment Company.
Scalability a characteristic of a new business concept that entails
the growth of sales and revenues with a much slower growth of
organizational complexity and expenses. Venture capitalists look for
scalability in the startups they select to fnance.
Scale-down a schedule for phased decreases in management fees
for general partners in a limited partnership as the fund reduces its
investment activities toward the end of its term.
Scale-up the process of a company growing quickly while
maintaining operational and fnancial controls in place. Also, a
schedule for phased increases in management fees for general
partners in a limited partnership as the fund increases its investment
activities over time.
Secondary market a market for the sale of limited partnership
interests in private equity funds. Sometimes limited partners chose
to sell their interest in a partnership, typically to raise cash or because
they cannot meet their obligation to invest more capital according to
the takedown schedule. Certain investment companies specialize in
buying these partnership interests at a discount.
Secondary shares shares sold by a shareholder (not by the
corporation).
Securities and Exchange Commission (SEC) the regulatory
body that enforces federal securities laws such as the Securities Act
of 1933 and the Securities Exchange Act of 1934.
Seed capital investment provided by angels, friends and family to
the founders of a startup in seed stage.
Seed stage the state of a company when it has just been incorporated
and its founders are developing their product or service.
Senior debt a loan that has a higher priority in case
of a liquidation of the asset or company.
Seniority higher priority.
Series A preferred stock preferred stock issued by a fast growth
company in exchange for capital from investors in the A round
of fnancing. This preferred stock is usually convertible to common
shares upon the IPO or sale of the company.
Shareholder agreement a contract that sets out, for example, the
basis on which the company will be operated and the shareholders
rights and obligations. It provides protection to minority shareholders.
Sharpe Ratio a method of calculating the risk-adjusted return of
an investment. The Sharpe Ratio is calculated by subtracting the
risk-free rate from the return on a specifc investment for a time
period (usually one year) and then dividing the resulting fgure by
the standard deviation of the historical (annual) returns for that
investment. The higher the Sharpe Ratio, the better.
Small Business Investment Company (SBIC) a company
licensed by the Small Business Administration to receive government
capital in the form of debt or equity in order to use in private equity
investing.
Stock option a right to purchase or sell a share of stock at a specifc
price within a specifc period of time. Stock purchase options are
commonly used as long term incentive compensation for employees
and management of fast growth companies.
Strategic investor a relatively large corporation that agrees to
invest in a young or a smaller company in order to have access to its
proprietary technology, product or service.
Subordinated debt a loan that has a lower priority than a senior
loan in case of a liquidation of the asset or company. Also known as
junior debt.
Success rate the proportion of venture funded companies that are
considered successful. A study of companies funded by VCs during
the 1990s indicated that 14% of the companies went public and
another 11%were acquired.
Sweat equity ownership of shares in a company resulting primarily
from work rather than investment of capital.
Syndicate a group of investors that agree to participate in a round
of funding for a company. Alternatively, a syndicate can refer to a
group of investment banks that agree to participate in the sale of
stock to the public as part of an IPO.
Synthetic secondary A popular method of completing a direct
secondary transaction in which the buyer becomes a limited partner
(LP) in a special purpose vehicle (SPV) or similar entity which has
been set up out of the underlying investments in order to create a
limited partnership interest. The term arose because of the synthetic
nature of the direct purchase through the LP secondary transaction.
Tag-along right the right of a minority investor to receive the
same benefts as a majority investor. Usually applies to a sale of
securities by investors. Also known as Co-sale right.
Takedown a schedule of the transfer of capital in phases in order
to complete a commitment of funds. Typically, a takedown is used
by a general partner of a private equity fund to plan the transfer of
capital from the limited partners.
Tender offer an offer to public shareholders of a company to
purchase their shares.
Term loan a bank loan for a specifc period of time, usually up to
ten years in leveraged buyout structures.
Term sheet a document confrming the intent of an
investor to participate in a round of fnancing for a company. By
signing this document, the subject company agrees to begin the legal
and due diligence process prior to the closing of the transaction.
Also known as Letter of Intent.
Tranche a portion of a set of securities. Each tranche may have
different rights or risk characteristics. When venture capital frms
fnance a company, a round may be disbursed in two or three
tranches, each of which is paid when the company attains one or
more milestones.
Turnaround a process resulting in a substantial increase in a
companys revenues, profts and reputation.
Under water option an option is said to be under water if the
current fair market value of a stock is less
than the option exercise price.
Underwriter an investment bank that chooses to be responsible
for the process of selling new securities to the public. An underwriter
usually chooses to work with a syndicate of investment banks in
order to maximize the distribution of the securities.
Venture capital a segment of the private equity industry which
focuses on investing in new companies with high growth potential
and accompanying high risk.
Venture capital method a pricing valuation method whereby an
estimate of the future value of a company is discounted by a certain
interest rate and adjusted for future anticipated dilution in order to
determine the current value. Usually, discount rates for the venture
capital method are considerably higher than public stock return rates,
representing the fact that venture capitalists must achieve signifcant
returns on investment in order to compensate for the risks they take
in funding unproven companies.
Vesting a schedule by which employees gain ownership over time
of a previously agreed upon amount of retirement funding or stock
options.
Vintage the year that a private equity fund stops accepting
new investors and begins to make investments on behalf of those
investors. Venture funds are generally benchmarked to funds of the
same vintage year.
Voting rights the rights of holders of preferred and common stock
in a company to vote on certain acts affecting the company. These
matters may include payment of dividends, issuance of a new class
of stock, merger or liquidation.
Warrant a security which gives the holder the right to purchase
shares in a company at a pre-determined price. A warrant is a long
term option, usually valid for several years or indefnitely. Typically,
warrants are issued concurrently with preferred stocks or bonds
in order to increase the appeal of the stocks or bonds to potential
investors.
Washout round a fnancing round whereby previous investors,
the founders and management suffer signifcant dilution. Usually
as a result of a washout round, the new investor gains majority
ownership and control of the company.
Weighted average cost of capital (WACC) the average of the cost
of equity and the after-tax cost of debt. This average is determined
using weight factors based on the ratio of equity to debt plus equity
and the ratio of debt to debt plus equity.
Weighted average anti-dilution an anti-dilution protection
mechanism whereby the conversion rate of preferred stock is
adjusted in order to reduce an investors loss due to an increase in
the number of shares in a company. Without anti-dilution protection,
an investor would suffer from a reduction of his or her percentage
ownership. Usually as a result of the implementation of a weighted
average anti-dilution, company management and employees who
own a fxed amount of common shares suffer signifcant dilution,
but not as badly as in the case of a full ratchet.
Write-down a decrease in the reported value of an asset or a
company.
Write-off a decrease in the reported value of an asset or a company
to zero.
Write-up an increase in the reported value of an asset or a company.
Zombie a company that has received capital from investors but
has only generated suffcient revenues and cash fow to maintain
its operations without signifcant growth. Sometimes referred to as
walking dead. Typically, a venture capitalist has to make a diffcult
decision as to whether to liquidate a zombie or continue to invest
funds in the hopes that the zombie will become a winner.
These defnitions were graciously provided by the Center for Private
Equity and Entrepreneurship at the Tuck School of Business at
Dartmouth. Please refer to the Centers website for additional
defnitions and information at http://mba.tuck.dartmouth.edu/ pecenter/
resources/glossary.html. Used by permission. Thomson Reuters and
National Venture Capital Association are grateful to the Center for its
support.
The MoneyTree Report is a quarterly study of venture capital investment
activity in the United States. As a collaboration between Pricewater-
houseCoopers and the National Venture Capital Association, based upon
data from Thomson Reuters, it is the only industry-endorsed research of
its kind. The MoneyTree Report is the defnitive source of information on
emerging companies that receive fnancing and the venture capital frms
that provide it. The study is a staple of the fnancial community, entrepre-
neurs, government policymakers and the business press worldwide.
Report Criteria
The MoneyTree Report records cash for equity investments as the cash
is actually received by the company (also called a tranche) as opposed
to when fnancing is committed (often referred to as a term sheet) to a
company. Accordingly, the amount reported in a given quarter may be less
than the total round amount committed to the company at the time when
the round of fnancing closed.
The type of fnancing as it is used in the MoneyTree Report refers to
the number of tranches a company has received. The number designation
(1, 2, 3, etc.) does not refer to the round of fnancing. Rounds are usually
designated alphabetically, e.g. Series A, Series B, and so on. The Money-
Tree Report does not track rounds.
Summary Description
The MoneyTree Report measures cash-for-equity investments by the
professional venture capital community in private emerging companies in
the U.S. It is based on data provided by Thomson Reuters.
General Denition
The report includes the investment activity of professional venture capital
frms with or without a US offce, SBICs, venture arms of corporations,
institutions, investment banks and similar entities whose primary activity
is fnancial investing. Where there are other participants such as angels,
corporations, and governments in a qualifed and verifed fnancing round
the entire amount of the round is included.
Qualifying transactions include cash investments by these entities either
directly or by participation in various forms of private placement. All re-
cipient companies are private, and may have been newly-created or spun-
out of existing companies.
The report excludes debt, buyouts, recapitalizations, secondary purchases,
IPOs, investments in public companies such as PIPES (private invest-
ments in public entities), investments for which the proceeds are primarily
intended for acquisition such as roll-ups, change of ownership, and other
forms of private equity that do not involve cash such as services-in-kind
and venture leasing.
Investee companies must be domiciled in one of the 50 US states or DC
even if substantial portions of their activities are outside the United States.
Specic Methodology
The focus of the report is on cash received by the company. Therefore,
tranches not term sheets are the determining factor. Drawdowns on com-
mitments are recognized at the time the company receives the money
rather than recorded as a lump sum amount at the time the term sheet is
executed. Convertible debt and bridge loans are recognized only when
converted to equity.
Once a company has received a qualifying venture capital fnancing round,
all subsequent equity fnancing rounds are included regardless of whether
the round involved a venture capital frm as long as all other investment
criteria are met (e.g. cash-for-equity, not buyout or services in kind).
Angel, incubator and similar investments are considered pre-venture f-
nancing if the company has received no prior qualifying venture capital
investment and are not included in the MoneyTree results. Angel, incu-
bator and similar investments that are part of a qualifying venture capital
round or follow a qualifying venture capital round are included to the ex-
tent that such investments can be fully verifed as meeting all other criteria
(e.g. cash for equity, not buyout or services in kind).
Direct investment by corporations (not through a corporate venture capital
arm) is excluded unless (a) the investment is clearly demonstrated to be
primarily a fnancial investment rather than outsourced R&D or market
development, (b) it is a co-investment in an otherwise qualifying round, or
(c) it follows a qualifying venture round in a company and meets all other
criteria (e.g. cash-for-equity, not buyout or services in kind).
Data is primarily obtained from a quarterly survey of venture capital prac-
titioners conducted by Thomson Reuters. Information is augmented by
other research techniques including other public and private sources. All
data is subject to verifcation with the venture capital frms and/or the
investee companies.
Only professional independent venture capital frms, institutional venture
capital groups, and recognized corporate venture capital groups are in-
cluded in venture capital industry rankings.
Disclaimer
PricewaterhouseCoopers and the National Venture Capital Association
have taken responsible steps to ensure that the information contained in
the MoneyTree Report has been obtained from reliable sources. How-
ever, neither of the parties nor Thomson Reuters can warrant the ultimate
validity of the data obtained in this manner. Results are updated periodi-
cally. Therefore, all data is subject to change at any time.
APPENDIX B
MoneyTree Report Criteria
PricewaterhouseCoopers/National Venture Capital Association
MoneyTree Report, Data: Thomson Reuters
APPENDIX C
MoneyTree Geographical Denitions
The Geographical Regions identifed in the MoneyTree Report by PricewaterhouseCoopers and the National Venture Capital Association based on
data provided by Thomson Reuters and used in this NVCA Yearbook are as follows:
Alaska/Hawaii/Puerto Rico: Alaska, Hawaii, and Puerto Rico
Colorado: The state of Colorado
DC/Metroplex: Washington, D.C., Virginia, West Virginia, and
Maryland
LA/Orange County: Los Angeles, Ventura, Orange, and Riverside
Counties (i.e., southern California, except San Diego)
Midwest: Illinois, Missouri, Indiana, Kentucky, Ohio, Michigan,
and western Pennsylvania
New England: Maine, New Hampshire, Vermont, Massachusetts,
Rhode Island, and parts of Connecticut (excluding Fairfeld
county)
New York Metro: Metropolitan NY area, northern New Jersey,
and Fairfeld County, Connecticut
North Central: Minnesota, Iowa, Wisconsin, North Dakota,
South Dakota, and Nebraska
Northwest: Washington, Oregon, Idaho, Montana, and Wyoming
Philadelphia Metro: Eastern Pennsylvania, southern New Jersey,
and Delaware
Sacramento/Northern California: Northeastern California
San Diego: San Diego area
Silicon Valley: Northern California, bay area and coastline
South Central: Kansas, Oklahoma, Arkansas, and Louisiana
Southeast: Alabama, Florida, Georgia, Mississippi, Tennessee,
South Carolina, and North Carolina
Southwest: Utah, Arizona, New Mexico, and Nevada
Texas: The state of Texas
Upstate New York: Northern New York state, except Metropolitan
New York City area
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APPENDIX D
Industry Codes (VEIC)
1000 Communications and Media
1100 Commercial Communications
1110 Radio & TV Broadcasting Stations
1120 CATV & Pay TV Systems
1125 Cable Service Providers
1130 Radio & TV Broadcasting & Other Related
Equipment
1135 Services to Commercial Communications
1199 Other Commercial Communications
1200 Telecommunications
1210 Long Distance Telephone Services
1215 Local Exchange Carriers (LEC)
1220 Telephone Interconnect & Other Equip-
ment
1230 Telephone answering and/or manage-
ment systems,PBXs
1299 Other Telephone Related
1300 Wireless Communications
1310 Mobile Communications, Pagers & Cel-
lular Radio
1320 Wireless Communications Services
1325 Messaging Services
1330 Wireless Communications Components
1399 Other Wireless Communications
1400 Facsimile Transmission
1500 Data Communications
1510 Local Area Networks (incl. voice/data
PBX systems)
1515 Wide Area Networks
1520 Data Communications Components
1521 Communications Processors/Network
Management
1522 Protocol Converters & Emulators
1523 Modems and Multiplexers
1524 Other Data Communication Components
1525 Switches/Hubs/Routers/Gateways/ATM
1530 Network test, monitor and support equip-
ment
1549 Other Data Communications
1550 Internet Communications and Infrastruc-
ture NEC
1551 Internet Access Services and Service
Providers
1552 Internet Multimedia Services
1553 Internet Backbone Infrastructure
1559 Other Internet Communications NEC
1560 E-Commerce Technology
1561 Internet Security and Transaction Services
1562 Ecommerce Services
1563 Ecommerce Enabling Software
1569 Other Ecommerce
1600 Satellite Microwave Communications
1610 Satellite Services/Carriers/Operators
1620 Satellite Ground (and other) Equipment
1630 Microwave Service Facilities
1640 Microwave & Satellite Components
1699 Other Satellite & Microwave
1700 Media and Entertainment
1710 Entertainment
1720 Publishing
1800 Other Communications Related
1810 Defense Communications
1825 Other Communications Services NEC
1899 Other Communications Products (not yet
classied)
2000 Computer Related
2100 Computers and Hardware
2110 Mainframes & Scientic Computers
2111 Mainframes
2112 Supercomputers and Scientic Computers
2119 Other Mainframes and Scientic Computers
2120 Mini & Personal/Desktop Computers
2121 Fail Safe Computers
2122 Mini Computers
2123 Personal Computers (micro/personal)
2124 Other Mini and Personal Computers
2125 Portable Computers (notebooks/laptops)
2126 Handheld Computing (PDA)
2130 Optical computing
2140 Servers and Workstations
2141 Servers
2142 Web Servers
2143 Workstations
2144 Thin Client Hardware
2149 Other Servers and Workstations
2200 Computer Graphics and Digital Imaging
2210 CAD/CAM, CAE,EDA Systems
2220 Graphic Systems
2230 Scanning Hardware
2234 OCR (Optical Character Recognition)
2236 OBR (Optical Bar Recognition)
2238 MICR (Magnetic Ink Character Recognition)
2239 Other Scanning Related
2250 Graphics Printers/Plotters
2255 Graphics/Enhanced Video Cards
2260 Other Graphics Peripherals
2280 Other Multimedia NEC
2290 Digital Imaging Hardware and Equipment
2295 Digital Imaging Services
2299 Other Computer Graphics
2300 Integrated Turnkey Systems and Solutions
2311 Business and Ofce
2312 Consumer
2313 Retailing
2315 Transportation
2316 Finance/Insurance/Real Estate
2317 Agriculture
2318 Recreation/Entertainment
2319 Manufacturing/Industrial/Construction
2320 Medical/Health
2321 Computer related
2322 Communications Products/Services
2323 Education
2324 Reference
2325 Scientic
2399 Other Intergrated Systems and Solutions
2500 Peripherals
2510 Terminals
2511 Intelligent Terminals
2512 Portable Terminals
2513 Graphics Terminals
2519 Other Terminals
2520 Printers
2521 Laser Printers
2522 Color Printers
2523 Inkjet Printers
2524 Dot Matrix Printers
2529 Other Printers
2530 Data I/O Devices
2531 Mouse Input Devices
2532 TouchPad Input Devices
2533 Pen based computing
2539 Other Data I/O Devices
2540 Disk Related Memory Devices
2541 Floppy Disks & Drives
2542 Winchester Hard Disks and Drives
2543 Optical Disks & Drives,CD-ROM DVD
2546 Disk Drive Components
2549 Other Disk Related
2550 Tape Related Devices
2551 Magnetic Tapes
2552 Tape Heads & Drives
2553 Continuous Tape Backup Systems
2559 Other Tape Related Devices
2560 Other Memory Devices (excl. semicon-
ductors)
2561 PC or PMCIA cards
2562 Memory Cards
2563 Sound Cards
2564 Communications Cards
2569 Other Peripheral Cards
2590 Other Peripherals (not yet classied)
2600 Computer Services
2630 Time Sharing Firms
2640 Computer Leasing & Rentals
2650 Computer Training Services
2655 Backup and Disaster Recover
2660 Data Processing,Analysis & Input Services
2665 Computer Repair Services
2670 Computerized Billing & Accounting Services
2675 Computer Security Services
2691 Data communications systems manage-
ment
2699 Other Computer Services
2700 Computer Software
2710 Systems Software
2711 Database & File Management
2712 Operating Systems & Utilities
2713 Program Development Tools/CASE/Lan-
guages
2716 Graphics and Digital Imaging Software
2719 Other Systems Software
2720 Communications/Networking Software
2721 Security/Firewalls,Encryption software
2722 Email Software
2723 Groupware
2724 Multimedia software
2729 Other Communications/Networking
Software
2730 Applications Software
2731 Business and Ofce Software
2732 Home Use Software
2733 Educational Software
2734 Manufacturing/Industrial Software
2735 Medical/Health Software
2736 Banks/Financial Institutions Software
2737 Retailing Software
2738 Integrated Software
2739 ERP/Inventory Software
2740 Recreational/Game Software
2741 Scientic Software
2743 Agricultural Software
2744 Transportation Software
2748 Other Industry specic Software
2749 Other Applications Software
2750 Articial Intelligence Related Software
2751 Expert Systems
2752 Natural Language
2753 Computer-Aided Instruction
2754 Articial Intel. Programming Aids
2755 Other Articial Intelligence Related
2760 Software Services
2761 Programming Services/Systems Engi-
neering
2762 Software Consulting Services
2763 Software Distribution/Clearinghouse
2765 Internet/Web Design and programming
services
2766 Internet Graphics Services
2768 Other Internet Software Services
2769 Other Software Services
2780 Internet Systems Software
2781 Site Development and Administration
Software
2782 Internet Search Software and Engines
2783 WebServer Software
2784 Web Languages (Java/ActiveX/HTML/XML)
2785 Web Authoring/Development Software
2798 Other Internet Systems Software
2799 Other Software Related
2800 Internet and Online Related
2810 E-Commerce--Selling products Online or
Internet
2811 Business and Ofce Products
2812 Consumer Products
2813 Retailing Products
2814 Publishing Products
2815 Transportation Products
2816 Finance/Insurance/Real Estate products
2817 Agricultural Products
2818 Recreation/Entertainment/Music/Movies
2820 Medical/Health
2821 Computer Related
2822 Communications Products
2823 Education Products
2824 Reference Products
2825 Scientic Products
2826 Legal Products
2829 Other Ecommerce Selling Products
2830 Ecommerce--Selling Services Online/
Internet
2831 Business and Ofce Services
2832 Consumer Services
2833 Retailing Services
2834 Publishing Services
2835 Transportation Services
2836 Finance/Insurance/Real Estate Services
2837 Agricultural Services
2840 Medical/Health Services
2841 Computer Related services
2842 Communications Products/Services
2843 Education Services
2844 Reference
2845 Scientic
2846 Legal
2848 Recreation/Entertainment Services
2849 Other Ecommerce Selling Services
2850 Web Aggregration/Portal Sites/Exchanges
2851 Business and Ofce Info/content
2852 Consumer Info/Content
2853 Retailing Info/Content
2854 Publishing Info/Content
2855 Transportation Info/Content
2856 Finance/Real Estate/Insurance Info/
Content
2857 Agriculture Info/Content
2859 Manufac/Industrial/Constr. Info/Content
2860 Medical/Health Info/Content
2861 Computer Related Info/Content
2862 Communications Info/Content
2863 Education Info/Content
2864 Reference Info/Content
2865 Scientic Info/Content
2866 Legal Info/Content
2869 Other Aggregation/Portal/Exchange Sites
2870 Internet Services
2871 Internet Marketing Services
2873 Data Warehousing Services
2879 Other Internet and Online Services NEC
2900 Other Computer Related
2910 Voice Synthesis
2911 Voice Recognition
2990 Other Computer Related (not yet classied)
3000 Other Electronics Related
3100 Electronic Components
3110 Semiconductors
3111 Customized Semiconductors
3112 Standard Semiconductors
3114 Flash Memory
3115 Optoelectronics semiconductors (incl
laser diodes)
3119 Other Semiconductors
3120 Microprocessors
3130 Controllers and Sensors
3132 Controllers
3135 Sensors
3139 Other Controllers/Sensors
3140 Circuit Boards
3160 Display Panels
3170 Other Electronics Related (including
keyboards)
3200 Batteries
3300 Power Supplies
3310 Uninterruptible Power Supply (UPS)
3400 Electronics Related Equipment
3410 Semiconductor Fabrication Equip. &
Wafer Products
3420 Component Testing Equipment
3499 Other Electronics Related Equipment
3500 Laser Related
3510 Laser Components (incl. beamsplitters,
excimers)
3599 Other Laser Related
3600 Fiber Optics
3610 Fiber Optic Cables
3620 Fiber Optic Couplers and Connectors
3630 Fiber Optic Communication Systems (see
1510)
3699 Other Fiber Optics
3700 Analytical & Scientic Instrumentation
3710 Chromatographs & Related Laboratory
Equipment
3720 Other Measuring Devices
3799 Other Analytical & Scientic Instrumenta-
tion
3800 Other Electronics Related
3810 Military Electronics (excluding communi-
cations)
3820 Copiers
3830 Calculators
3835 Security/Alarm/Sensors
3899 Other Electronics Related (incl. alarm
systems)
3900 Optoelectronics
3910 Photo diodes
3920 Optoelectronics fabrication equipment
3930 Lenses with Optoelectronics applications
3940 Advanced photographic processes (incl
lithographs)
3989 Other Optoelectrinics Related
3990 Other Electronc Semiconductor
4000 Biotechnology and Pharmacology
4100 Human Biotechnology
4110 Medical Diagnostic Biotechnology Products
4111 In Vitro Monoclonal Antibody Diagnostics
4112 In Vivo Monoclonal Antibody Diagnostics/
Imaging
4113 DNA/RNA Probes
4119 Other Medical Diagnostic Biotechnology
4120 Therapeutic Biotechnology Products
4121 Therapeutic Monoclonal Antibodies
4122 Immune Response Effectors
(interferons,vaccines)
4123 Other Therapeutic Proteins (incl. hor-
mones & TPA)
4129 Other Therapeutic Biotechnology
4130 Genetic Engineering
4200 Agricultural/Animal Biotechnology
4210 Genetically Engineered Plants
4220 Genetic. Eng. Microorganisms to raise
plant yield
4230 Other Plant Related Biotechnology
4240 Biotech Related Animal Health & Nutri-
tion Products
4250 Genetically Engineered Animals
4290 Other Animal Related Biotechnology
4300 Industrial Biotechnology
4310 Biochemical Products
4311 Biotech Related Fine Chemicals (NOT
Pharmaceuts.)
4312 Biotech Related Commodity Chemicals
4319 Other Biochemical Products
4320 Biotech Processes for Food Industrial Ap-
plications
4321 Biotech Related Food Enzymes and
Cultures
4322 Biotech Related Food Diagnostics
4329 Other Biotech Process for Food/Industrial
Products
4330 Biotech Processes for Pollution/Toxic
Waste Contrl
4340 Biotech Processes for Enhanced Oil
Recovery/Mining
4390 Other Industrial Biotechnology
4400 Biosensors
4410 Biosensors for Medical Diagnostic Ap-
plications
4420 Biosensors for Industrial Applications
4490 Other Biosensors
4500 Biotech Related Research & Production
Equipment
4510 Biotech Related Analytical Instruments &
Apparatus
4520 Biotech Related Production Equipment
4525 Biotech laser and optronic applications
4599 Other Biotech Research & Production
Equipment
4600 Biotech Related Research & Other Services
4610 Pure & Contract Biotechnology Research
4699 Other Biotechnology Services
4900 Other Biotechnology Related
5000 Medical/Health Related
5100 Medical Diagnostics
5110 Diagnostic Services
5120 Medical Imaging
5121 X-Rays
5122 CAT Scanning
5123 Ultra Sound Imaging
5124 Nuclear Imaging
5125 Other Medical Imaging
5130 Diagnostic Test Products & Equipment
5140 Other Medical Diagnostics
5200 Medical Therapeutics
5210 Therapeutic Services
5220 Surgical Instrumentation & Equipment
5221 Surgical lasers (including laser delivery
bers)
5230 Pacemakers & Articial Organs
5240 Drug Delivery & Other Equipment
5299 Other Therapeutic (including debrillators)
5300 Medical Health Related Products
5310 Disposable Medical Products
5340 Handicap Aids
5350 Medical Monitoring Equipment
5380 Health related optics (including glasses,
lenses)
5399 Other Medical/Health (NEC)
5400 Medical Health Services
5410 Hospitals/Clinics/Primary Care
5412 Long Term Care/Home Care/Elder Care
5414 Dependent Care (child care/assisted living
5420 Managed care (including PPO/PPM)
5429 Other Healthcare Facilities
5430 Emergency Services/Ambulance
5440 Hospital & Other Institutional Management
5499 Other Medical/Health Services
5500 Pharmaceuticals
5510 Pharmaceutical Research
5520 Pharmaceutical Production
5530 Pharmaceutical Services
5540 Pharmaceutical Equipment
5550 Pharmaceuticals/Fine Chemicals (non-
biotech)
5599 Other Pharmaceutical NEC
6000 Energy Related
6100 Oil & Gas Exploration and Production
6200 Oil & Gas Exploration Services
6300 Oil & Gas Drilling & Support Services
6400 Oil & Gas Drilling,Exploration & Extrac-
tion Equip.
6410 Oil & Gas Drilling & Extraction Equipment
6420 Oil & Gas Drilling Instrumentation
6430 Oil & Gas Exploration Equip. Instrumen-
tation
6499 Other Oil & Gas (NEC)
6500 Alternative Energy
6510 Solar Energy
6511 Photovoltaic Solar
6512 Other Solar
6520 Wind Energy
6530 Geothermal Energy
6540 Energy Co-Generation
6599 Other Alternative Energy (incl. nuclear
energy)
6600 Enhanced Oil Recovery/Heavy Oil/Shale
6700 Coal Related
6710 Coal Mining
6720 Coal Related Equipment
6799 Other Coal Related
6800 Energy Conservation Related
6900 Other Energy Related
7000 Consumer Related
7100 Entertainment and Leisure
7110 Movies,Movie Products & Theater Opera-
tions
7120 Amusement & Recreational Facilities
7125 Casino and Gambling
7130 Toys & Electronic Games
7140 Sporting Goods,Hobby Equipment &
Athletic Clothes
7150 Sports Facilities (Gyms and Clubs)
7155 Sports
7160 TVs,Radio,Stereo Equipment & Consumer
Electronics
7170 Music,Records,Production and Instruments
7199 Other Leisure/Recreational Products and
Services
7200 Retailing Related
7210 Drug Stores
7220 Clothing and Shoe Stores
7230 Discount Stores
7240 Computer Stores
7245 Retail Publishing (books,magazines,
newspapers)
7246 Ofce Supply Stores
7247 Music/Electronics
7248 Specialty Department and retail stores
7250 Franchises(NEC)
7299 Other Retailing Related
7300 Food and Beverages
7310 Wine & Liquors
7320 Health Food
7330 Soft Drinks & Bottling Plants
7340 Food Supplements/Vitamins
7350 General Food Products
7399 Other Food and Beverages
7400 Consumer Products
7410 Clothing,Shoes & Accessories (incl. jew-
elry)
7420 Health & Beauty Aids
7430 Home Furnishing & Housewares
7431 Housewares
7432 Furnishings & Furniture
7433 Garden and Horticultural Products
7434 Other Home Furnishings (NEC)
7450 Mobile Homes
7499 Other Consumer Products
7500 Consumer Services
7510 Fast Food Restaurants
7520 Other Restaurants
7530 Hotels and Resorts
7540 Auto Repair Shops
7550 Education & Educational Products and
Materials
7560 Travel Agencies and Services
7599 Other Consumer Services
7999 Other Consumer Related (not yet classied)
8000 Industrial Products
8100 Chemicals & Materials
8110 Plastic Fabricators
8111 Homogeneous Injections/Extrusions
8112 Non-Homogeneous Injections/Extrusions
8113 Fiber-Reinforced (Plastic) Composites
8114 Other Fabricated Plastics
8115 Processes for Working with Plastics
8119 Other Plasti Fabricators
8120 Coatings & Adhesives Manufacturers
8121 Optical coatings
8129 Other Coatings & Adhesives
8130 Membranes & Membrane-Based Products
8140 Specialty/Performance Materials
8141 Semiconductor Materials (eg. silicon wafers)
8142 III/V Semiconductor Mater. (eg. gallium
arsenide)
8143 Specialty Metals (incl. coatings, alloys, clad)
8144 Ceramics
8145 Lubricants & Functional Fluids
8146 Other Specialty Materials
8147 Specialty materials for laser generation
8148 Superconducting materials
8149 Other Special Performance Materials
8150 Commodity Chemicals & Polymers
8151 Industrial Chemicals
8152 Polymer (Plastics) Materials
8160 Specialty/Performance Chemicals
8161 Electronic Chemicals
8162 Other Industrial Chemicals
8170 Agricultural Chemicals
8189 Other Commidity Chemicals and Polymers
8199 Other Chemicals & Materials (not yet
classied)
8200 Industrial Automation
8210 Energy Management
8220 Industrial Measurement & Sensing Equip-
ment
8221 Laser related measuring & sensing equip-
ment
8230 Process Control Equipment & Systems
8240 Robotics
8250 Machine Vision Software & Systems
8260 Numeric & Computerized Control of
Machine Tools
8299 Other Industrial Automation (NEC)
8300 Industrial Equipment and Machinery
8310 Machine Tools, Other Metalworking
Equipment
8320 Hoists,Cranes & Conveyors
8330 Pumps,Ball Bearings,Compressors,Indus.
Hardware
8340 Mining Machinery
8350 Industrial Trucks and Tractors
8360 Other Industrial Process Machinery
8370 Power Transmission Equipment (genera-
tors & motors)
8399 Other Industrial Equipment & Machinery
8500 Environmental Related
8510 Air Filters & Air Purication & Monitoring
Equip.
8520 Chemical and Solid Material Recycling
8530 Water Treatment Equipment & Waste
Disposal Systems
8599 Other Environmental Related
8600 Other Industrial Products (not yet classied)
8700 Industrial Services
9000 Other Services and Manufacturing
9100 Transportation
9110 Airlines and Aviation Related
9120 Trucking
9125 Railway related
9130 Leasing of Railcars,Buses and Cars
9140 Mail and Package Shipment
9150 Motor Vehicles,Transporation Equipment
& Parts
9160 Aireld and Other Transportation Services
9180 Advanced Aircraft/Aerospace
9199 Other Transportation
9200 Financial Services
9210 Insurance Related
9220 Real Estate
9230 Banking
9235 Non Bank Credit
9240 Securities & Commodities Brokers and
Services
9250 Investment Groups
9254 Venture Capital and Private Equity Investors
9255 Financial Transactions Services
9299 Financial Services,0ther
9300 Services
9310 Engineering Services
9320 Advertising and Public Relations
9330 Leasing (not elsewhere classied)
9340 Distributors,Importers and Wholesalers
9350 Consulting Services
9360 Media Related Services
9399 Other Services NEC
9400 Product Manufacturing
9410 Business Products and Supplies
9415 Ofce Automation Equipment
9420 Ofce Furniture & Other Professional
Furnishings
9430 Textiles (Synthetic & Natural)
9440 Hardware, Plumbing Supplies
9450 Publishing
9460 Packaging Products & Systems
9470 Printing & Binding
9499 Other Manufacturing (not elsewhere clas-
sied)
9500 Agriculture,Forestry,Fishing,Animal
Husbandry,etc.
9510 Agriculture related
9520 Forestry related
9530 Fishing related
9540 Animal husbandry
9599 Other Agriculture,Forestry,Fishing
9600 Mining and Minerals (non-energy related)
9700 Construction & Building Products
9710 Construction
9720 Manufacture of Building Products
9730 Manufacture of Pre-Fabricated Buildings
& Systems
9740 Distribution of Building Products & Systems
9750 Construction Services
9799 Other Construction & Building Products
Related
9800 Utilities and Related Firms
9810 Electric Companies
9820 Water,Sewage,Chem. & Solid Waste
Treatment Plants
9830 Gas Transmission & Distribution
9899 Other Utilities & Related Firms
9900 Other Products and Services
9910 Conglomerates
9912 Socially Responsible
9914 Environment Responsible
9915 Women-Owned
9918 Minority-Owned
9920 Holding Companies
9999 Other Products and Services
Industry analysis is based upon the following industry sectors: Biotechnology, Business Products and Services,Computers and Peripherals, Consumer
Products and Services, Computer Software, Electronics/Instrumentation, Financial Services, Healthcare Services, Industrial/Energy, IT Services, Me-
dia and Entertainment, Medical Devices and Equipment, Networking and Equipment, Retailing/Distribution, Semiconductors, Telecommunications
and Other. These sectors are based on the 17 industry classifcations of the MoneyTree Report by PricewaterhouseCoopers and the National Venture
Capital Association based on data from Thomson Reuters.
Biotechnology
4000, 4100, 4110, 4111, 4112, 4113, 4119, 4120, 4121, 4122, 4123, 4129, 4130, 4200, 4210, 4220, 4230, 4240, 4250, 4290, 4300, 4310, 4311, 4312,
4319, 4320, 4321, 4322, 4329, 4330, 4340, 4390, 4400, 4410, 4420, 4490, 4500, 4510, 4520, 4525, 4599, 4600, 4610, 4699, 4900, 5500, 5510, 5520,
5530, 5540, 5550, 5599
Business Products and Services
2811, 2824, 2831, 2844, 9300, 9310, 9320, 9330, 9340, 9350, 9360, 9399
Computers and Peripherals
2000, 2100, 2110, 2111, 2112, 2119, 2120, 2121, 2122, 2123, 2124, 2125, 2126, 2130, 2140, 2141, 2142, 2143, 2144, 2149, 2220, 2230, 2234, 2236,
2238, 2239, 2250, 2255, 2260, 2280, 2290, 2295, 2299, 2500, 2510, 2511, 2512, 2513, 2519, 2520, 2521, 2522, 2523, 2524, 2529, 2530, 2531, 2532,
2533, 2539, 2540, 2541, 2542, 2543, 2546, 2549, 2550, 2551, 2552, 2553, 2559, 2560, 2561, 2562, 2563, 2564, 2569, 2590, 3170
Consumer Products and Services
2812, 2832, 7000, 7300, 7310, 7320, 7330, 7340, 7399, 7400, 7410, 7420, 7430, 7431, 7432, 7433, 7434, 7450, 7499, 7500, 7510, 7520, 7530, 7540,
7550, 7560, 7599, 7999
Computer Software
1563, 2200, 2210, 2300, 2311, 2312, 2313, 2315, 2316, 2317, 2318, 2319, 2320, 2321, 2322, 2323, 2324, 2325, 2399, 2700, 2710, 2711, 2712, 2713,
2716, 2719, 2720, 2721, 2722, 2723, 2724, 2729, 2730, 2731, 2732, 2733, 2734, 2735, 2736, 2737, 2738, 2739, 2740, 2741, 2743, 2744, 2748, 2749,
2750, 2751, 2752, 2753, 2754, 2755, 2780, 2781, 2782, 2783, 2784, 2785, 2798, 2799, 2900, 2910, 2911, 2990, 8250
3000, 3100, 3160, 3200, 3300, 3310, 3400, 3420, 3499, 3500, 3510, 3599, 3700, 3710, 3720, 3799, 3800, 3810, 3820, 3830, 3835, 3899
Financial Services
2816, 2836, 9200, 9210, 9220, 9230, 9235, 9240, 9250, 9254, 9255, 9299
Healthcare Services
2820, 2840, 5400, 5410, 5412, 5414, 5420, 5429, 5430, 5440, 5499
Industrial/Energy
2819, 2837, 2839, 6000, 6100, 6200, 6300, 6400, 6410, 6420, 6430, 6499, 6500, 6510, 6511, 6512, 6520, 6530, 6540, 6599, 6600, 6700, 6710, 6720,
6799, 6800, 6900, 8000, 8100, 8110, 8111, 8112, 8113, 8114, 8115, 8119, 8120, 8121, 8129, 8130, 8140, 8143, 8144, 8145, 8146, 8147, 8148, 8149,
8150, 8151, 8152, 8160, 8161, 8162, 8170, 8189, 8199, 8200, 8210, 8220, 8221, 8230, 8240, 8260, 8299, 8300, 8310, 8320, 8330, 8340, 8350, 8360,
8370, 8399, 8500, 8510, 8520, 8530, 8599, 8600, 8700, 9000, 9100, 9110, 9120, 9125, 9130, 9140, 9150, 9160, 9180, 9199, 9400, 9410, 9415, 9420,
9430, 9440, 9460, 9470, 9499, 9500, 9510, 9520, 9530, 9540, 9599, 9600, 9700, 9710, 9720, 9730, 9740, 9750, 9799, 9800, 9810, 9820, 9830, 9899
IT Services
1560, 1561, 1562, 1569, 2600, 2630, 2640, 2650, 2655, 2660, 2665, 2670, 2675, 2691, 2699, 2760, 2761,
2762, 2763, 2765, 2766, 2768, 2769, 2800, 2870, 2871, 2873, 2879
APPENDIX E
Industry Codes (VEIC)
1110, 1120, 1125, 1130, 1135, 1199, 1700, 1720, 2814, 2818, 2834, 2838, 2843, 2848, 2850, 2851, 2852, 2853, 2854, 2855, 2856, 2857, 2858, 2859,
2860, 2861, 2862, 2863, 2864, 2865, 2866, 2869, 7100, 7110, 7120, 7125, 7130, 7140, 7150, 7155, 7160, 7170, 7199, 9450
Medical Devices and Equipment
5000, 5100, 5110, 5120, 5121, 5122, 5123, 5124, 5125, 5130, 5140, 5200, 5210, 5220, 5221, 5230, 5240, 5299, 5300, 5310, 5340, 5350, 5380, 5399
1400, 1500, 1510, 1515, 1520, 1521, 1522, 1523, 1524, 1525, 1530, 1549, 3600, 3610, 3620, 3630, 3699
2810, 2813, 2815, 2817, 2821, 2823, 2825, 2826, 2829, 2830, 2833, 2835, 2841, 2845, 2846, 2849, 7200, 7210, 7220, 7230, 7240, 7245, 7246, 7247,
7248, 7250, 7299, 7350
Semiconductors
3110, 3111, 3112, 3114, 3115, 3119, 3120, 3130, 3132, 3135, 3139, 3140, 3410, 3900, 3910, 3920, 3930, 3940, 3989, 3990, 8141, 8142
Telecommunications
1000, 1100, 1200, 1210, 1215, 1220, 1230, 1299, 1300, 1310, 1320, 1325, 1330, 1399, 1550, 1551, 1552, 1553, 1559, 1600, 1610, 1620, 1630, 1640,
1699, 1710, 1800, 1810, 1825, 1899, 2822, 2842
Other
9900, 9910, 9912, 9914, 9915, 9918, 9920, 9999
APPENDIX F
Stage Denitions
SEED STAGE FINANCING
This stage is a relatively small amount of capital provided to an inventor or entrepreneur to prove a concept.
This involves product development and market research as well as building a management team and developing a business plan, if the
initial steps are successful. This is a pre-marketing stage.
EARLY STAGE FINANCING
This stage provides fnancing to companies completing development where products are mostly in testing or pilot production. In some
cases, product may have just been made commercially available. Companies may be in the process of organizing or they may already
be in business for three years or less. Usually such frms will have made market studies, assembled the key management, developed a
business plan, and are ready or have already started conducting business.
EXPANSION STAGE FINANCING
This stage involves working capital for the initial expansion of a company that is producing and shipping and has growing accounts
receivables and inventories. It may or may not be showing a proft. Some of the uses of capital may include further plant expansion, mar-
keting, working capital, or development of an improved product. More institutional investors are more likely to be included along with
initial investors from previous rounds. The venture capitalists role in this stage evolves from a supportive role to a more strategic role.
LATER STAGE
Capital in this stage is provided for companies that have reached a fairly stable growth rate; that is, not growing as fast as the rates at-
tained in the expansion stages. Again, these companies may or may not be proftable, but are more likely to be than in previous stages
of development. Other fnancial characteristics of these companies include positive cash fow. This also includes companies considering
IPO.
ACQUISITION FINANCING
An acquisition of 49% stake or less. Firm acquires minority shares of a company. Thomson Reuters includes these deals in standard
venture capital disbursement data when calculating venture capital disbursements where the funding is by a venture capital frm.
ACQUISITION FOR EXPANSION
Funds provided to a company to fnance its acquisition of other companies or assets. A consolidator of companies in specifc indus-
tries.
MANAGEMENT/LEVERAGED BUYOUT
These funds enable an operating management group to acquire a product line or business, at any stage of development, from either a
public or private company. Often these companies are closely held or family owned. Management/leveraged buyouts usually involve
revitalizing an operation, with entrepreneurial management acquiring a signifcant equity interest.
RECAP/TURNAROUND
Financing provided to a company at a time of operational or fnancial diffculty with the intention of improving the companys perfor-
mance.
SECONDARY BUYOUT
A buyout deal on top of a buyout deal. Secondary buyouts are distinguished when the initial frm investor is different from the current
investing frm.
APPENDIX G
Data Sources and Resources
DATA SOURCES AND RESOURCES
MONEYTREE DATA
PricewaterhouseCoopers, Thomson Reuters, and the National Venture
Capital Association joined forces in December 2001 to produce what was
then known as the PricewaterhouseCoopers/Thomson Venture Econom-
ics/National Venture Capital Association MoneyTree Survey. Conduct-
ed on a quarterly basis, the designated PwC/NVCA MoneyTree Report
allows Thomson Reuters unparalleled access to primary sources of infor-
mation from general partners.
SOURCES OF DATA
The online database of Thomson Reuters is ThomsonONE.com (Ven-
tureXpert), the foremost information provider for private equity profes-
sionals worldwide. The private equity portion of Thomson Reuters of-
fers an incomparable range of products from directories to conferences,
journals, newsletters, research reports, and the ThomsonONE.com Private
Equity database. As of January 2014, the database included over 110,000
portfolio companies, over 18,000 private equity frms, over 31,000 private
equity funds, and nearly 250,000 fnancing rounds. By establishing work-
ing relationships with private equity and venture capital frms, institutional
investors, and industry associations such as the NVCA, Pricewaterhouse-
Coopers and other such entities around the world, Thomson Reuters has
been able to gather, on a timely basis, complete and accurate information.
TIMELINESS OF DATA
Many of the tables and charts presented in this reportcan be produced
by using ThomsonONE.com. One of advantages of using ThomsonONE.
com is that the reader can customize a report to better ft the needs of
what they are seeking. In addition, because the online database is con-
tinuously updated, the information available is more up-to-date than what
can be presented in this report. Readers should note that timely industry
information on details concerning venture capital investment is available
from other sources such as PricewaterhouseCoopers at www.pwcmoney-
tree.com, the Industry Stats section of the NVCA website, www.nvca.
org, and the Private Equity section ofThomson Reuters Deals Intelligence
found at http://dmi.thomsonreuters.com/PrivateEquity.
VERIFICATION AND UPDATING OF DATA
Collectively, PricewaterhouseCoopers, Thomson Reuters, and the
NVCA have the utmost commitment to provide an accurate historical
record of venture capital activity. On a daily basis, the database is con-
stantly analyzed for consistency, crosschecked with other data sources,
and updated as new information comes in. On a quarterly basis, we have
worked with many venture frms to ensure that that their current and past
data is correct. Primarily for this reason, the private equity news releases
of Thomson Reuters will often restate statistics from prior news releases.
With the availability of the online data access, users are encouraged to
always use the most current numbers even regarding historical activity so
as to maintain accuracy and comparability.
REPORTING FUNCTIONALITY OF
THOMSONONE.COM
Users can access information in terms of profles on private equity com-
panies, funds, frms, executives, IPOs, and limited partners. In addition,
users can access the analytics portion of the database, which contains in-
vestment, valuation, IPO analytics, merger analytics, fund performance,
and fund raising information along with venture capital information such
as aggregate fund raising, investments, and IPOs broken out into state and
nation profles.
COMPREHENSIVENESS OF
THOMSONONE.COM
Both the breadth and depth of ThomsonONE.com can perhaps best be
shown in that it, among other types of information, the user can fnd the
answers to the following questions:
Which venture frms actively co-invest with a frm I am considering
co-investing with?
Which venture frms are most active in funding online fnancial ser-
vices companies in the Ohio Valley?
What does Yearbook Figure 3.15 look like for just biotech?
How much money was raised by each fund stage in 2010?
What was a particular venture-backed IPOs one year return at the
end of 2010?
As of December 2011, was the 10-year return to small buyout funds
larger than that of large buyout funds?
For this publication, the main source for data was ThomsonONE.com, the online research database of Thomson Reuters. ThomsonONE.com (which
replaced VentureXpert, and Thomson One Banker) is endorsed by the NVCA as the offcial United States venture capital activity database. By using
data gathered through the MoneyTree Report by PricewaterhouseCoopers and the National Venture Capital Association based on data from Thom-
son Reuters, ThomsonONE.com contains investment, fund raising, portfolio company information, and Reuters News along with other statistical data.
Over 950,000 global private companies can be analyzed within ThomsonONE.com, including historical revenue fgures on over 670,000 companies
and detailed fnancials on over 200,000 companies. Through a partnership withVC Experts.com, Inc.the historical breadth and depth of the Thomson
Reuters venture capital content is integrated with private company valuation and deal terms. ThomsonONE.com includes blogs, events, and articles
from the peHUB and the Venture Capital Journal, two of the industrys most widely-read publications. Other information contained in this database is
gathered through a variety of public and proprietary source. This publication is produced on an annual basis primarily using year-end data. However,
the underlying databases can be accessed online to provide the most up-to-date and comprehensive global private equity statistics and profle informa-
tion available.
Who are the most active acquirers of ecommerce security companies?
How much money was committed to mezzanine funds from 1997 to
2011?
How much money was invested in the venture capital industry from
1987 to 2011?
What is the performance at quarter end for private equity funds that
were formed from 1998 to 2011?
In 2011, how much money was invested at each development stage in
Research Triangle Pharmaceutical companies? In addition, there are
also advantages of using the database for a general partner as well.
Although this is not an inclusive list, utilizing the database by general
partners can be helpful to them for among the following reasons:
Plan your companies exits with data on both venture-backed IPOs
and mergers and acquisitions
Aid in recruiting talented executives from otherventure-backed com-
panies
Quickly spot venture-backed companies in competition with your
own portfolio companies
Create industry analyses to benchmark both performance and portfo-
lio investments
Find other venture capitalists likely to support follow-on rounds
Provide clarity to investment decisions by comparingthem to current
market conditions
Compile valuation reports for comparable portfolio companies
Identify prospective investors and their investment histories
Benchmark valuations among recent transactions and obtain valuation
comparables
Analyze investment trends by industry
Utilize returns information to limited partners using appropriate
benchmarks
Tailor your pitch to investor focus size and limited partner type
ACCESSING THOMSONONE.COM AND OTHER
SERVICES
For more information on ThomsonONE.com, please visit http://thom-
sonreuters.com/private-equity-venture-capital/ or by phone at 1-877-365-
1455. For information on NVCA membership, which can include a free
trial and discounts on an annual subscription, please contact Hannah Veith
at the NVCA. You may contact her online through the link on the mem-
ber benefts section of the NVCA website or at 703-524-2549. For infor-
mation on services PricewaterhouseCoopers provides for venture capital
frms as well as emerging companies, please visit their website at www.
pwcmoneytree.com.
APPENDIX H
International Convergence
The discussions and work focused on moving toward one high quality set of standards for fnancial reporting have begun to provide a picture of the
future. While that picture is more gray scale than vivid color, the following facts and expectations highlight the current state of play at this point in time:
The SEC issued a report in 2012, without a recommendation, on whether to adopt international accounting rules, or a modifcation thereof, as
the accepted accounting practice in the United States.
It appears increasingly unlikely that the SEC will move 100% into the International Financial
Reporting Standards (IFRS) camp;
FASBs parent, the Financial Accounting Foundation, created a new Private Company Council (PCC) to advise them on private company ac-
counting. Their work is just beginning;
The AICPA is considering whether the PCC will provide an appropriate framework for private companies or if the AICPA should continue with
efforts to develop an alternative non-GAAP basis of accounting for private companies;
The International Accounting Standards Board (IASB) modifed IFRS consolidation rules to effectively create Investment Company accounting
substantially similar to that used under U.S. GAAP; and
While Fair Value accounting rules are now virtually identical under U.S. GAAP and IFRS, auditors are raising questions related to unit of
account and valuing minority positions that could impact how venture capital and private equity funds estimate Fair Value.
The Dialogue and SEC Decision: Should international
rules become accepted as U.S. GAAP?
For years, the United States has been developing generalized accounting
principles referred to as
Generally Accepted Accounting Principles (GAAP). The keeper/arbiter/
decider of GAAP is the Financial Accounting Standards Board (FASB).
The FASB develops and updates GAAP and the SEC has adopted these
accounting rules for public company reporting and other situations over
which the SEC has jurisdiction. In recent years, on a parallel track, a sep-
arate set of rules emerged from the International Accounting Standards
Board (IASB), which was Europe-centric. These rules became known
as the International Financial Reporting Standards (IFRS, pronounced
EYE-fers). IFRS has now been adopted by most developed and many
developing countries around the world, with the exception of the United
States.
Over recent years, a large number of multinational corporations com-
plained that they had to endure keeping two sets of books and this prompt-
ed the concept of convergence. In early September 2008, the
SEC and the FASB announced steps to pave the way for United States
public companies to convert from
U.S. GAAP to IFRS. The SEC roadmap provided for a three-year run-
up to an SEC go-no go decision in 2011, but the decision was deferred.
At about the same time, the FASB and the IASB met to review and re-
orient their convergence plan to be consistent with the SECs proposed
schedule. The 2008-2009 world fnancial crisis deferred and deprioritized
much of the work in this area.
The SECs 2012 staff report on adopting IFRS did not make a recom-
mendation, but raised questions about consistent application, transpar-
ency, reliability, relevance, comparability, and ongoing costs in addition
to any conversion costs, which might be signifcant. More relevant to the
United States venture capital industry are matters specifcally affecting
fund reporting, the fnancial statements provided by GPs to LPs under the
eventual rules. Because of the recent change in IFRS consolidation rules,
United States venture capital frms would conceptually not be impacted
by a change to IFRS.
How United States GAAP and International IFRS
Compare Never Generalize
Even viewed from 30,000 feet, it is diffcult to generalize on how the two
systems compare. First, while the IASB produces plain vanilla IFRS stan-
dards, there is no one favor of IFRS in use. Much like the original UNIX
kernel, each country/jurisdiction has been able to create its own version
of IFRS. But unlike UNIX, sometimes the differences among the local-
ized IFRS versions are large. So apples-to apples comparison of IFRS-
compliant fnancials from different jurisdictions can be diffcult. Second,
it is true that IRFS itself is a very thin document compared to GAAP,
which has grown to roughly a two-foot stack of written rules. However, to
implement IFRS, you need the implementation guide that combines with
the original document to create its own two-foot stack. Again, much of the
surface comparisons are not useful. Until now, United States venture capi-
tal frms have been using U.S. GAAP accounting standards exclusively.
While seemingly distant from the United States venture capital industry,
it is important that all business constituencies weigh in on which system
(current U.S. GAAP vs. International vs. neither) is the best system over-
all for the United States business community going forward.
GP-to LP Reporting Can Meaningful
Statements Continue?
A key priority for the United States venture capital industry is being
able to continue producing quarterly fnancial statements using invest-
ment company (IC) accounting. Virtually all LP agreements (or accom-
panying documents) require GPs to provide GAAP-compliant fnancial
reports to LPs. Annual audits include testing to ensure GAAP compliance.
Under GAAP, the United States venture capital industry now provides
Fair Value portfolio reports under the special rules of investment compa-
ny reporting. In 2012, IFRS was modifed to effectively create a fnancial
reporting framework substantially similar to U.S. GAAP.
GPs should not lose sight of the fact their LPs who pre-
pare nancial statements using either U.S. GAAP
or IFRS, in almost all cases, must report their LP fund positions on a
Fair Value basis. LPs are increasingly awakening to the specifc condi-
tions outlined in a change to U.S. GAAP from 2009, which codifed an
LPs ability to use Net Asset Value (NAV) as an LPs estimate of the Fair
Value of their fund interest. These conditions include that the LP must
satisfy themselves that the GP reported NAV is based on the Fair Value
of underlying investments, that NAV is in-phase (no time lag, unless
deemed insignifcant), and that the LP interest is in a fund as defned by
ASC Topic 946. If these three conditions are not met, or if the LP chooses
not to use NAV, then Fair Value would be determined using other tech-
niques. The point here for GPs is that LPs need robustly determined Fair
Value on a timely basis, generally at least quarterly.
How the Same Words have Different Meanings
The 2012 change in IFRS consolidation rules for Investment Entities
and the 2011 adoption of a common defnition of Fair Value for U.S.
GAAP and IFRS should have created a framework where fnancial report-
ing to investors would be identical for funds using IFRS and funds using
U.S. GAAP. If it were only that easy!
While we enter 2013 with a consistent framework under U.S. GAAP
and IFRS where venture capital and private equity funds report all invest-
ments at Fair Value; and while we now have an identical defnition of Fair
Value (the amount a market participant would pay in an orderly transac-
tion), schisms are developing.
Because of nuances in the way IFRS is drafted, IFRS auditors are ques-
tioning whether Fair Value should be determined based on the invest-
ment or on a single share basis. While the reasons for such a question
are beyond the scope of this document, the question and potential results
could mean that IFRS and U.S. GAAP, though identical in principle,
would result in different Fair Value estimates (as an aside, this is an ex-
ample of one situation that concerns the SEC in moving the United States
towards IFRS).
At the same time, many auditors of U.S. GAAP, as a reaction to their
regulators the PCAOB, and because of pressure from the SEC, which now
regulates private equity funds, are questioning whether or not the sale or
exit of an enterprise can be assumed when determining the Fair Value of
minority positions. Some auditors have gone so far as to indicate that they
may require the use of option pricing models for determining the Fair
Value of all minority positions.
Going Forward
With questions regarding whether or not IFRS should be interpreted as
requiring all Fair Value estimates to be on a single share basis, and with
U.S. auditors appearing to feel some pressure to use mathematical models
to document their audit conclusions, both GPs and LPs in the venture
capital and private equity industry could be faced with fnancial report-
ing that is either very costly and/or is not representative of how deals are
done in the industry. In December 2012, the International Private Equity
& Venture Capital Valuation (IPEV) Board updated its Valuation Guide-
lines. The updated valuation guidelines address both the unit of account
and mathematical model questions. In addition, IPEV released Investor
Reporting Guidelines in October 2012. While each fund manager must
decide both what information to report and how to estimate Fair Value, the
IPEV Valuation Guidelines and the IPEV Investor Reporting Guidelines
provide balanced, and industry created, assistance in dealing with report-
ing and valuation questions.
NVCA and Thomson Reuters acknowledge and appreciate the assis-
tance of David Larsen of Duff and Phelps in updating and refocusing the
material in this Appendix.
APPENDIX I
US Accounting Rulemaking and Valuation Guidelines
In the United States, a venture capital fund is usually organized as a limited partnership. The institutional investors providing capital to a fund typically
become the limited partners (LPs). The venture frm itself becomes a general partner (GP) in the limited partnership. In most of the limited partnership
agreements defning the GP-LP relationship, the GPs are required to provide fnancial reports quarterly (unaudited) and annually (audited) prepared
according to United States Generally Accepted Accounting Principles (GAAP). GAAP calls for the use of investment company accounting, which
mandates that a Fair Value be assigned to the individual investments (portfolio companies). This is consistent with the LPs need for Fair Value of
their investments, as well as third-party or regulatory requirements, e.g., ERISA-regulation. In recent years, the GP-to-LP fnancial statements have
been subject to numerous rule clarifcations, convergence with non-U.S. accounting, expanded disclosures, and more formal presentations. Industry
groups (PEIGG a decade ago and IPEV today) have released guidelines that, if adopted, can reduce questions from LPs and provide a basis to respond
to questions posed by auditors.
Guidelines fall into two categories. The frst is portfolio performance
presentation formats, calculations, and disclosure. Examples of such
Guidelines are the Private Equity Provisions of the Global Investment
Performance Standards (GIPS), developed by the CFA Institute and the
IPEV Investor Reporting Guidelines. While many of the specifcations
and terminology line up with current practice in the United States, the
NVCA has not endorsed or otherwise commented on these Guidelines.
Neither NVCA nor Thomson Reuters has determined how widespread the
adoption of those guidelines is or will likely be. These documents and ac-
companying guidance can be currently found at http://www.cfainstitute.
org/centre/codes/gips/ and www.privateequityvaluation.com.
The second important category of guidelines is focused on valuation.
Why Valuation Guidelines Matter
What ultimately matters to investors and private equity practitioners is the
cash that has been distributed to the investors during the life of the fund
compared with the original money put in. However, the specifed life of a
typical venture fund is at least 10 years and often longer in the life scienc-
es arena. During that period, the venture capital fund reports progress to
the limited partners. In many cases, this means quarterly portfolio updates
and a complete annual audited fnancial statement. For a typical venture
fund, very little money is paid out in the frst four or fve years. Also, while
every portfolio company receives funding with high expectations, it can
take several years to determine if a particular company is a likely winner.
Therefore, understanding progress in the portfolio requires some estimate
of the success of the investee companies by the venture capital or private
equity frm. While many investors and fund managers agree that fnancial
measurements mean little for the frst three or so years of a fund, investors
are required to report the Fair Value of their fund positions on a quarterly
or annual basis. This is where specifc valuation rules and processes be-
come important. The agreed valuation procedures for individual portfolio
companies become the basis for progress assessment as the fund matures
and ultimately distributes cash to the investors.
Thus, while portfolio company valuations are more of an art than a sci-
ence, especially for pre-revenue or even pre-EBITDA companies, most
limited partner agreements (LPAs) establishing a venture capital fund
require the venture frm to provide quarterly and annual fnancial state-
ments using Generally Accepted Accounting Principles (GAAP). GAAP
requires Fair Value measurement for portfolio positions. Therefore, most
GPs must issue fnancial statements using Fair Value.
Most important, if industry-created valuation guidelines are not used,
those outside the industry, such as auditors or regulators could impose
their view on the industry. A non-industry view could adversely impact
the LPs desire and ability to invest if interim values are not representative
of the way the industry sees value, and costs for determining valuation
could increase.
The Evolution of Reporting and Valuation Guidelines
To understand the pressure on valuation and reporting in todays environ-
ment, a historical background review is instructive.
1940 United States Investment Company legislation (the 40 Act)
required investment companies to report the Fair Value of investments.
While the application of accounting standards has evolved over the past
70+ years, the underlying basis of reporting has always been Fair Value.
1989-90 A group of investors, private equity fund managers, and
fund-of-fund managers formed a group to develop a set of portfolio
company valuation guidelines for fnancial reporting. Contrary to a very
persistent rumor, the NVCA did not endorse, adopt, bless, publish, or
otherwise opine on the guidelines. Using the principle of conservatism,
these non-endorsed guidelines used cost or the value of the last round of
fnancing to approximate Fair Value.
Decade of the 1990s Two noteworthy developments occurred in the
1990s. Despite no endorsement by the NVCA, these guidelines became
accepted practice by much of the United States industry, especially in the
venture capital side of private equity. These guidelines were referred to
by many as being issued by the NVCA but in fact they were not. The sec-
ond development is that international venture associations created local-
ized guidelines based heavily on these guidelines. These were created in
Europe and other international regions. In fact, by 2005, there had been
multiple iterations of the European and British guidelines, again gener-
ally focused on cost or the value of the last round of fnancing.
December 2003/September 2004 The Private Equity Industry Guide-
lines Group (PEIGG), a self-appointed group of private equity practitio-
ners, fund managers, LPs and others, issued U.S. Private Equity Valu-
ation Guidelines. The Guidelines were issued after extensive input and
review soliciting feedback and input from a number of industry groups
that included NVCA.
2005 In part as a reaction to the PEIGG Guidelines, three Europe-
based venture capital associations (AFIC, BVCA, EVCA) created the
International Private Equity and Venture Capital (IPEV) Valuation
Board.
April 2006 IPEV released its Valuation Guidelines.
September 2006 Financial Accounting Standards Board (FASB)
issued its long-awaited and long anticipated Fair Value measurement
standard as FAS 157. Only a few of its 145 pages relate directly to typi-
cal venture capital and private equity funds. Because the FASB main-
tains that this is a clarifcation and further defnition of Fair Value that
was already required for portfolio accounting, some auditors began re-
quiring selective compliance in advance of the 2008 effective date.
March 2007 PEIGG issued a revised portfolio company valuation
guidelines document to refect the Fair Value Measurement standard
(FAS 157).
September 2007 NVCA board reaffrmed its prior position on the
PEIGG guidelines to refer to the most recent version.
March 2008 the IPEV Board reconstituted and re-launched itself and
adds fve practitioners from the United States. The initial focus of the
group was on convergence of U.S. PEIGG and IPEV valuation guide-
lines. Details at www.privateequityvaluation.com.
July 2009 Effective July 1, authoritative GAAP became contained in
a single codifcation and the prior nomenclature went away. Existing
U.S. GAAP was recast into 90 topics, which include all related FASB
pronouncements, AICPA guidance and EITFs under single Topics.
Familiar standards would no longer exist. For example, FAS 157 be-
came Topic 820 Fair Value Measurements and Disclosure. Investment
Company accounting became ASC Topic 946.
May 2011 FASB amended ASC Topic 820 and the IASB issues IFRS
13, resulting in nearly identical Fair Value guidance.
October 2012 IPEV released Investor Reporting Guidelines
December 2012 IPEV updated its Valuation Guidelines to harmonize
with ASC Topic 820 and IFRS 13.
May 28, 2013 In an unprecedented action, the NVCA Board formal-
ly endorsed the IPEV valuation guidelines issued in December 2012.
NVCA was joined in doing this by the Private Equity and Growth Capi-
tal Council (PEGCC).
February 25, 2014 The Financial Accounting Foundation (FASBs
parent organization) issues its fndings of a Post Implementation Re-
view of the fair value measurement standard (Topic 820) which is better
known by its original nomenclature: FAS 157. FAFs overall fnding was
that overall the FASB got the standard basically correct, a point with
which NVCA does not disagree. However, the fndings acknowledged
concerns raised by NVCA, LPs, and others while simultaneously declar-
ing no unintended consequences.
NVCA Position on Portfolio Company Valuation
Guidelines
While publicly supportive of prior peer and eco-system generated valua-
tion guidance (for example, PEIGG), NVCAs endorsement of IPEV valu-
ation guidelines in May 2013 is the frst such action it has taken.
NVCA Member Alert Fair Value Considerations for
Venture CapitalistsDecember 2008
In 2008, as a response to the economic crisis at the time, the NVCA issued
a membership alert. Much of that alert remains relevant today. The fol-
lowing alert was sent to the NVCA membership to highlight certain issues
and considerations to be explored in the application of FAS 157, the Fair
Value measurement standard. The NVCA thanks David Larsen of Duff
and Phelps and several members of the NVCA CFO Task Force for their
role in drafting this document:
We are operating in a severely distressed investment environment that
has deteriorated rapidly in the past few months. What does this mean for
venture capital investors as they attempt to value privately-held invest-
ments at December 31, 2008? The short answer is: despite the current
very challenging economic environment, fund managers must continue to
exercise their sound judgment in estimating the Fair Value of each portfo-
lio company after considering the relevant facts, including current market
conditions. The valuation process does not change, but much more judg-
ment is required when we are in a period of economic discontinuity. Virtu-
ally all LP agreements require GPs to use U.S. GAAP for fnancial report-
ing. U.S. GAAP requires Fair Value reporting for virtually all VC frms
because they are investment companies. U.S. GAAP continues to defne
Fair Value as: the price that would be received to sell an assetin an
orderly transaction between market participants at the measurement date.
Fund managers need to establish Fair Values even though they may not
currently need to sell, or cannot sell, their private investments in this mar-
ket. GPs must use their judgment in estimating the current Fair Values
of their investments, even though exit markets may have few buyers,
IPO markets appear closed, and there are few, if any, relevant compa-
rable transactions. Such judgment should take into account all relevant
information, including a fnancing rounds specifc terms and conditions.
There are no easy outs, rules of thumb or safe harbors for establishing
Fair Value. As always, best considerations for Fair Value determination
include the following:
The Fair Value of an investment portfolio is the sum of the Fair Value
determined for each portfolio company using a bottoms up approach.
Applying a top-down overall percentage adjustment to the aggregate
portfolios value is not compliant with U.S. GAAP.
Valuations should refect specifc factors in a buy/sell context. For ex-
ample, a GP could ask: Given my portfolio companys current cash
position, cash burn rate, performance compared to plan, probability of
meeting forecasts, the projected environment for its product or technol-
ogy, etc., as a board member, what is the lowest price that I would sell
the companys stock today in an orderly sale with a willing buyer?
[Footnote: A fund manager should not assume a fre sale of the stock,
but should assume exposure to the market for a period prior to the
measurement date to allow for marketing activities that are usual and
customary from SFAS 157, Paragraph 7].
The valuations set by the most recent fnancing round perhaps even
one in the third quarter of 2008 may be stale and inappropriate for
determining Fair Value, especially given current market conditions.
The Fair Value at December 31 in many cases will likely be different
from the value at September 30, given the deterioration of the macro-
economic environment.
Each valuation should refect a companys degree of progress from the
prior reporting date to the current one.
To determine a portfolio companys Fair Value, GPs should apply their
judgment in a consistent manner and evaluate the same data they use for
monitoring a companys performance and progress. There is no magic
formula or weighting of factors.
In summary, determining Fair Value continues to require the exercise of
judgment based on objective evidence, such as calibrating the original
investment decision with the current performance of the company and
the current economic environment. The fact that the macro market is dis-
tressed probably adversely impacts the value of most companies. This
negative impact may be compounded by disappointing company perfor-
mance or mitigated by tangible and sustainable company progress. If you
need more details about Fair Value, you might consider the IPEV Valua-
tion Guidelines at www.privateequityvaluation.com.
2014 Headwinds
As noted above, new pressure is emerging that could impact how venture
capital and private equity managers estimate Fair Value. Key factors in-
clude:
1. LPs are awakening to the fact that they need to obtain more information
from the GP about how the GP estimates Fair Value so the LP can use
NAV to estimate the Fair Value of their LP interest.
a. LPs are revisiting their internal valuation policies.
b. LPs are asking more detailed valuation questions of the GP.
2. The IASB has created investment company accounting by requiring
venture capital and private equity funds to report all investments at Fair
Value rather than consolidating control positions.
3. Auditors of IFRS have raised questions concerning the level of aggre-
gation (unit of account) that should be used to value venture capital and
private equity investments.
a. Some auditors believe that unit of account is a single share of an
investee company.
b. Single share valuations would likely result in reporting understated
Fair Values.
c. Reporting understated Fair Values would exacerbate the J curve,
and could cause some LPs to reduce investments in the industry be-
cause of lower interim returns.
d. IFRS could deviate from U.S. GAAP even though the Fair Value
principles are identical.
4. Auditors of U.S. GAAP have raised questions concerning how to esti-
mate the Fair Value of non-control positions.
a. Is it appropriate to assume that the entire enterprise is being sold when
estimating Fair Value?
b. For non-control positions, is it appropriate or required to use option
pricing models and theory to estimate Fair Value?
The IASB is expected to address the Unit of Account question during
early 2013. The AICPA has formed a task force to provide guidance on
investments of venture capital and private equity funds. Part of the reason
the AICPA has formed a task force is because the IPEV guidelines have
not been as widely accepted or acknowledged in the U.S. as they have
been in Europe. Further, while some parties have voiced concern that the
AICPA task force conclusions may be relatively auditor-friendly, several
members of that task force are from NVCA members.
All of this raises the question: could GPs reduce LP questions and increase
LP valuation comfort by stating that they comply with the IPEV Valuation
Guidelines? Will current efforts at non-authoritative accounting guidance
provide a framework with which the great compliance community will be
comfortable? Over the next year, greater clarity should emerge.
NVCA and Thomson Reuters acknowledge and appreciate the assistance
of David Larsen of Duff and Phelps in updating and refocusing the mate-
rial in this Appendix
APPENDIX J
Non-US Private Equity
As interest in globalization increases with each year, private equity investors have continued to broaden their investment criteria to include overseas
ventures so as to increase portfolio diversifcation and search for higher returns. As such, Appendix J is produced for readers to analyze non-US private
equity data. All data is reported in US dollars.
INTRODUCTION
This appendix highlights various aspects of private equity activity out-
side of the United States and provides valuable information for compari-
son to the United States private equity environment. However, this appen-
dix is not directly comparable to domestic data found in this Yearbook
due to differences in defnitions between the regions and variations in the
currencies of each region. Additionally, this appendix provides a brief
overview of non-US private equity; data herein is not as comprehensive
as the United States data presented elsewhere in this publication. Despite
this, the reader can use this appendix to analyze trends in private equity
outside of the United States. All data is provided by Thomson Reuters. As
mentioned previously, readers should note the differences in methodol-
ogy and defnitions of private equity between United States and other re-
gions before analyzing the data. For example, private equity outside of the
United States provides equity capital for entities not publicly traded and
consists of buyouts and venture capital. The category of buyouts includes
management buyouts (management from inside the company investing
with private equity investors), leveraged buyouts (the target taking on a
high level of debt secured by assets), institutional buyouts (outside inves-
tors buying a business from existing shareholders), and management buy-
ins (management from outside the company investing with private equity
investors). On the other hand, venture capital describes the process of f-
nancing companies at the seed, start-up, or expansion stages. The United
States places more emphasis on the early stages of development than do
other regions, based on historical analysis of investments by stage. Like in
the United States, non-US venture capital is considered a subset of private
equity. For ease of analysis and to avoid differences in defnitions between
venture capital and buyouts inside and outside of the United States, it is
perhaps most comparable to analyze aggregate private equity in the two
regions as opposed to any classifcations contained within.
**Special Note: The methodology used to generate the data within this
appendix differs slightly from the methodology used in previous years,
causing data to vary slightly from previous Yearbook issues. However,
trends reported in the past remain intact. Additionally, most data is now
replicable on ThomsonONE.com.
COMMITMENTS
Private equity commitment levels, outside of the United States, totaled
$130.8 billion in 2013. European-based funds raised the bulk, raising
$77.5 billion, equal to 59% of this amount. Meanwhile, Asian funds had
$30.9 billion in fundraising commitments which is 24% of the total. Funds
in the Other Regions raised the remaining $22.4 billion or 17% of the to-
tal. In the stage level, Buyout commitments outside the United States ac-
counted for $68.3 billion or 52% of the total. The second largest part of the
commitments was Other Private Equity/Special Situations which raised
$19.9 billion or 15% of the total. Venture Capital funds represented 8%
($10.2 billion). Private Real Estate funds raised $13.5 billion or 10% of
the share. Fund of funds, Generalist, and Mezzanine funds raised $6 bil-
lion, $10 billion, and $3.1 billion, respectively. It should be noted that
these totals refect not only the amount raised by independent funds, but
also include capital gains and the amount raised by captive funds.
INVESTMENTS
Overall, private equity investing outside of the United States reached
$46.6 billion. Buyout stage fnancing led investment activity, accounting
for 43% of the total dollars. The Venture Capital investments followed
with 32% of the total. By number of deals, Venture Capital investments
led with 56% and the Buyouts investments followed with 37% of the total
deal activity outside of the United States. Canada received the biggest
share of private equity outside the United States in 2013 with $9 billion
worth of investments or 19% of the total value. The United Kingdom fol-
lowed with $5.2 billion. China comes in at third with $4.9 billion or 10%
of the total. Private equity commitments experienced an increase while
investments saw a decrease outside of the United States in 2013. Commit-
ments saw an increase of 16% from $113 billion in 2012. Private equity
investments dropped 21% from $59 billion of the previous year.
Figure J1
Private Equity Commitments Outside of the United States
in 2013
Fund World Location # Funds Amount Raised in Range (USD Mil)
Europe 170 77,544.94
Asia 116 30,943.34
Other Regions 88 22,354.11
Total 374 130,842.38
Figure J2
Private Equity Commitments Outside of the United States
by Fund Stage in 2013
Fund Stage # Funds Amount Raised in Range (USD Mil)
Buyouts 98 68,253.15
Venture Capital 137 10,181.76
Generalist 47 9,952.74
Mezzanine Stage 9 3,065.56
Fund of Funds 22 5,984.68
Other Private Equity/
Special Situations
19 19,856.58
Real Estate 42 13,547.92
Total 374 130,842.38
Figure J3
Private Equity Investments Outside of the United States
By Location in 2013
Company Nation # Deals # Companies Sum of Equity Invested
(USD Mil)
Canada 845 747 9,018.66
United Kingdom 742 696 5,223.91
China 310 291 4,862.14
Germany 442 405 4,821.09
India 355 321 3,169.58
Other Nations 2343 2215 19,455.95
Total 5037 4675 46,551.33
Figure J4
Private Equity Investments Outside of the United States
By Stage in 2013
Company Stage # Deals # Companies Sum of Equity Invested
(USD Mil)
Buyout/Acquisition 1881 1769 20,119.97
Venture Capital 2805 2609 14,752.98
Other 351 327 11,678.38
Total 5037 4675 46,551.33

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