2016

VC Unicorn
Report

In-depth terms and more behind the

greatest unicorns in venture history
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Content
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EDITORIAL

Contents
editorial@pitchbook.com

SALES
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Overview 4-6
Terms Highlights 7
Terms Tables 8-13 COPYRIGHT 2016 by PitchBook Data, Inc.
All rights reserved. No part of this publication
may be reproduced in any form or by any
Select Unicorn Statistics 14-15 meansgraphic, electronic, or mechanical,
including photocopying, recording, taping, and
information storage and retrieval systems
Unicorn League Tables 16-18 without the express written permission of
PitchBook Data, Inc. Contents are based
on information from sources believed to be
reliable, but accuracy and completeness
cannot be guaranteed. Nothing herein should
be construed as any past, current or future
recommendation to buy or sell any security
or an offer to sell, or a solicitation of an offer
to buy any security. This material does not
purport to contain all of the information that
a prospective investor may wish to consider
and is not to be relied upon as such or used in
substitution for the exercise of independent
judgment.

Image credit: Albertus Magnus, De animalibus,

woodcut, Frankfurt am Main. Taken from
Wikimedia Commons.

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 3
Overview
A t this point, its fair to confess a
distinct fatigue when it comes
to discussion of VC unicornsprivate
stagnant economic growth that
a slew of unicorns emerged,
characterized by their rapid growth,
the sheer volatility in public markets
is just the first of many incentives
to stay unlisted. Public offerings
companies valued at $1 billion or massive funding and reluctance are expensive and time-consuming,
more. After a few years of intense to go public. Private markets are and if sufficient private capital is
scrutiny of their ranks, its easy to simply more alluring to investors available to fuel growth initiatives,
presume that pretty much all that nowadays, and as for businesses, why undergo the intense scrutiny?
needs to be said about unicorns
The pace of unicorn formation has slowed dramatically
has been said. Particularly in the
Unicorns over time in US
context of the slowly ongoing reset
in venture capital, the prevailing 120 $450
106
narrative seems familiar: The pace of Cumulative unicorns (#) New unicorns (#) $386 $400
unicorn formation has slowed as the 100 95
$362
current crop focuses on sustainably $350
Aggregate unicorn post-valuations ($B)
growingwith some struggling more
80 $300
than otherswhile those that can
are still raising considerable sums in $250
nontraditional ways. 60
$200
43
But any over-hype and familiar
trends shouldnt dissuade us from 40 $150
recognizing just how unprecedented $100
the unicorn phenomenon still is, 20 11
especially as it may signify a seismic $50
shift in the role the venture capital 0 $0
industry plays in private markets in 2009 2010 2011 2012 2013 2014 2015 2016*
general. Its not a coincidence that Source: PitchBook
in the current era of nontraditional *As of 8/31/2016. Only most recent post-valuations of unicorns that exist as of the end of August are
included.
monetary policies and seemingly

After unprecedented sums invested in unicorns during 1H, things subsided significantly during summer 2016
US venture activity

$25 3,000
Non-unicorn deal value ($B) Unicorn deal value ($B) # of closed deals

2,500
$20

2,000
$15
1,500
1,166
$10
1,000

$5
500

$0 0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q*
2010 2011 2012 2013 2014 2015 2016
Source: PitchBook
*As of 8/31/2016

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 4
Its not that founders have changed
in their honed focus on growing their
businesses, its that for the first time,
investors are willing to fund private
companies at a higher rate than ever
before. The promise of explosive
growth in the current sluggish
macroeconomic landscape was and
is seductivethe fact many unicorns
seemed to be actually scaling the
heights originally envisioned during
the dot-com era only added fuel to
the fire.
The problem is, of course, that its unicorns yet and record sums still
rather difficult to actually disrupt. invested in the likes of Uber?
Building a sustainable business is
First off, to reiterate, the rate of new
hard enoughchanging a whole
unicorn formation has distinctly
industry renders it more difficult by
slowed, so its only the proven, extant
an order of magnitude. To take a
crop that are primarily responsible
topical example, witness Theranoss
for continued fundraising. The
very publicized struggles, or the
general explanation that a capital-
attrition slowly unrolling in the food
rich environment is causing a
and meal kit delivery space. But how
concentration among safer prospects
to reconcile the VC slowdown with
at the late stage only partially
the figures below and above, where
explains such continued unicorn
2016 has seen the most youthful
funding. As alluded to in our most

Second-shortest median time to unicorn recorded in An all-time lowest unicorn ages in 2016
2016 Average & median age of current unicorns in US
Average & median time to unicorn since founding in US
18
9 Median (years) Average (years)
16
8
7.2 14
7 6.7
6.9 12
6
5.2 10
8.7
5
8
8.1 7.0
4
6 5.7
3
Median (years) Average (years) 4
2
2
1
0
0 2009 2010 2011 2012 2013 2014 2015 2016*
2009 2010 2011 2012 2013 2014 2015 2016* Source: PitchBook
Source: PitchBook *As of 8/31/2016
*As of 8/31/2016

An uptick in 2016 signals some caution Unicorns minted in 2016 still raised relatively quickly
Time between prior and unicorn rounds in US Time between first and unicorn rounds in US

3 8
Median (years) Average (years)
Median (years) Average (years)
7
3
6
2 5.3
5 4.8
1.7
4.2
1.6 4.5
2 4
1.3
3
1
1.0
2
1
1

0 0
2009 2010 2011 2012 2013 2014 2015 2016* 2009 2010 2011 2012 2013 2014 2015 2016*
Source: PitchBook Source: PitchBook
*As of 8/31/2016 *As of 8/31/2016

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 5
recent Valuations Report, late-stage
companies with sufficient financial
means are able to access lines of
credit or other financing alternatives
beyond simply raising another strictly
traditional venture round that would
only further complicate capital
structures and potential liquidity. On
top of that, secondary markets to
alleviate unicorns relative illiquidity
have evolved, enabling employees
and earlier investors to achieve
some returns. Combine that with an
intensified focus on fundamentals
and more investor-friendly terms and
In 2016, businesses were closer to unicorn status than ever before when
they finally joined the herd
Valuation step-ups from previous round to unicorn financing in US
6.0x
5.0x
5.0x
4.0x
3.0x
2.5x
2.0x
1.0x
it becomes clearer why some firms
are still ponying up capital to back
unicorns, as most potential concerns
are addressable. In short, there are
ways and means for unicorns to keep
raising for some time, and some
will continue to do so. Billion-dollar
businesses dont fold overnightits
probabl ewell see still-significant
sums raised by unicorns in the
remainder of the year, although its
important to note that companies are
becoming unicorns more sedately
in 2016, per the valuation step-ups
below.
Median Average
3.3x
2.1x
2.3x
1.8x
Source: PitchBook
*As of 8/31/2016
Plus, at this point, the potential
for a surge in tech M&A must be
considered. The list of companies
that can buy unicorns is short, but
the incentives can be compelling for
many, ranging from revitalizing core
businesses with new product lines to
economies of scale. Taking prices into
consideration, by this time next year
some of the unicorns in this report
will have been acquiredUnilever is
in talks to buy The Honest Company,
for example, although if that deal
does close at a discounted valuation
it doesnt bode too well. But for
most, an IPO remains the most likely
exit avenue. The window in 2016 is
narrowingwith uncertainty around
the political landscape and an interest
rate rise, its likely to shut unless some
follow Nutanixs lead and price soon.
Accordingly, 2017 is shaping up to be
quite the year for potential unicorn
IPOs. Although, in conclusion, its not
inconceivable that some unicorns
simply stay private for as long as
possible, achieving whatever liquidity
they need to through somewhat
unorthodox means such as secondary
markets or even, perhaps, buyouts by
private equity firms with established
tech investment theses.

0.0x
2014 2015 2016*

Median Russell 2000 Growth versus median Series D or later post-valuation growth in US

500
449.7
450 Source: PitchBook
*As of 8/31/2016
Russell 2K Growth Later Stage
400
370.0
350
300
250 227.4
206.0
200
150
100
50
0
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016*
P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 6
Terms Highlights
T he following six pages contain
a dizzying array of information
conveyed in semi-legalese that can
be hard to parse. While meant to
be a resource for your personal
consultation in the future, weve
summarized some of the key findings
in this section.
Downside protections
By and large, as noted in the prior
edition of this report, there remains
a considerable focus on downside
protection. For example, The Honest
Company has a detailed breakdown
of different stock series conversions
in its IPO protection terms: Series
C converts upon proceeds of $70
million, Series D at $100 million. If the
IPO share price is less than $33.82,
the Series C and D conversion prices
shall be adjusted to equal the product
of (c) the Series C or D original issue
price (OIP) as applicable, and (b) the
quotient of the series C or D OIP/
Series C/D target price.
Qualtrics, in turn, has preferred shares
converting into common upon an
IPO with a price per share of at least
2x the Series E OIP. Interestingly,
Qualtrics happens to have a reversal
of the usual last in, first out order
of stock liquidation when it comes to
acquisition protection terms. Series
A stock goes first, then Series B and
C share pari passu, then Series D
and, finally, Series E. As the company
has only had two completed venture
financings, however, that preference
makes sense.
Every single unicorn in the tables
following this section had the
standard weighted average anti-
dilution adjustments for future
financing protection, so, accordingly,
we simply removed that column in
order to highlight more interesting,
varying provisions. Especially in the
current climate, and given the heft
of unicorn financing rounds, senior
liquidation protections abound, with
a select few such as Social Finance
possessing equal sharing by all
series of preferred stock ratably, with
protection over common stock. SoFi
also has fairly detailed IPO protection
terms, with each share of Series A, B,
D, E and F automatically converting
upon a public offering of not less
than $15.78 per share and aggregate
proceeds of not less than $100
million.
Although in general the conclusions
to be drawn from the following tables
are the same as in the last Unicorn
Reportinvestors are protecting
themselves in an uncertain climate
yet, as they are still willing to finance
unicorns in the first place, the terms
are not overly indulgent one way
or the otherwhats interesting is
that one can pinpoint certain terms
of recent financings of unicorns
in particular industries and glean
insights. For example, when it
comes to dividends, its intriguing to
assess which companies have been
sweetening deals, although dividends
are often not much more than just
that, sweeteners.
Upside benefits
Magic Leap has non-cumulative
dividends at the rate of $1.84 for
Series C, $0.92 for Series B, $0.10
for Series A and $0.0773 for seed.
Although not the most sizable of
dividends within the subsequent
unicorn tables and relatively standard
at about 8%, the weighting helps
signify the level of risk in Magic Leaps
financings, as judged by participants.
Zoox actually has one of the higher
Series A share non-cumulative
dividend allotments in absolute
terms at $4.13 per share per annum,
although that is also 8% of OIP.
When it comes to participation, most
unicorns have non-participating
provisions. However, a few exceptions
exist: Sprinklr has all of the remaining
proceeds available for distribution
to stockholders duly distributed
among shareholders of Series B, C
and common stock, for example.
Interestingly, when it comes to
multiple liquidation, only four
unicorns in the following tables have
any. The Honest Company has Series
A and A1 receiving 1x their OIP, Series
B 2x, Series C 1.43x and Series D 1x, all
before common shareholders receive
anything. Qualtrics and DocuSign also
have multiple liquidation preferences,
while Tanium technically has none
but their Series F shareholders have
a liquidation price that is much lower
than OIP: $0.027.
All in all, most of the upside benefits
are in the form of dividends of
varying favorability. IPO auto
converts are applied for about half
the unicorn sample, with the other
half having automatic conversions
at OIP. The range of upside benefits
exemplify how investors in unicorn
financings have assiduously sought to
garner protection in both defensive
and more immediately beneficial
forms, given the inherent level of risk.
P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 7
Unicorn IPO Protection Terms Acquisition Protection Terms

Senior liquidation protection ove

Each share preferred automatically converts (if held by a founder, to Class A common. If held by any
SeriesYes: A,B,C,D,D2 senior to
other person/entity, to Class B common) upon an IPO of no less than $50M
Series 1

Senior liquidation protection ove

Each preferred share automatically converts into common immediately upon the closing of this
SeriesYes: A,B,C,D,D2 senior to
corporations sale of an IPO with gross proceeds no less than $500K and a P.O. price not less than
Series 1. Liquidation protection ov
$108.17
ContextLogic common stockyes

Senior liquidation protection ove

Series E: converted into common at the then-applicable conversion rate upon an IPO of at least $60M
SeriesYes: Series E is senior to
and price per share of at least $17.98. Series D: converted into common upon an IPO of at least $60M
Series D and D is senior to Series
and price per share of at least $16.15. Junior preferred (A, B, C) converted into common upon an IPO of
B and C . Liquidation protection o
at least $60M and price per share of at least $10
common stockyes

Series D: converted to common at the then-effective conversion rate upon an IPO of at least $35M,
and a P.O. price of no less than $10.46598. Following terms applicable for Series C, B, Seed and S-2:
converted into common at the then-effective conversion rate upon the earlier of (A) a qualified P.O.; (B)
Series seed, S-2, A, B-1, B-2, B-3,
the date or event specified by vote or agreement of a majority of that series outstanding shares, or (C)
and D share ratably upon liquidat
the date or event specified by vote or agreement of the holders. Series A: converted into common at the
then-effective conversion rate upon the earlier of (A) a qualified P.O., (B) the date or even specified by
66.67% votes of Series A, or (C) the date or even specified by vote or agreement of the holders
Non-regulated preferred (AA, A, B, C, and D): converted automatically into Series A common at the
then-applicable conversion price upon the closing of a public offering no less than $50M aggregate
or the date or event specified by vote of the majority of the non-regulated pref stock. Series B-1: upon
the occurrence of those events, shall no longer be entitled to any rights that are not also applicable to
shares of Series A common, and shall be deemed to have waived those rights, and each holder B-1 shall Series AA, A, B, B-1, C, and D sha
receive only an amount per share equal to the amounts that may become payable to holders of Series ratably upon liquidation
A common as if B-1 preferred had been converted into shares of Series A at the then-effective Series
Warby Parker B conversion price. Also, upon a permitted regulatory transfer, each B-1 share shall automatically be
converted into 1 share Series B if the transfer occurs prior to a deemed automatic conversion, and Series
A Common if the transfer occurs on or after a deemed automatic conversion

A and A1 converts with proceeds of $50M and price per share of $18.1755. Series B converts with
proceeds of $50M minimum. Series C converts upon a $70M. Series D converts at a $100M. If IPO price
per share is less than $21.9704, the Series B conversion price shall be adjusted to equal the product of Pari passu (A, A1, B, C and D
(a) the Series B OIP and (b) the quotient of price per share common/Series B target price. If the IPO participate equally). Liquidation
share price is less than $33.8216, the Series C and D conversion prices shall be adjusted to equal the protection over common stocky
product of (c) the Series C or D OIP as applicable, and (b) the quotient of the Series C or D OIP/Series
C/D target price

First, Series A. Second,B and C sh

Preferred converts into common at the conversion rate that the time in effect upon an IPO with a price pari passu. Third, Series D. Fourth
Qualtrics
per share at least 2x the Series E OIP Series E. Liquidation protection o
common stockyes

Each share Series A, A-1, B, B-1 and C automatically convert upon a public offering price not less than Series A, A-1, B, B-1, C, D, E and
$4.41 per share with proceeds of $40M. Series D shall convert with a public offering share price of F share pari passu. Liquidation
$6.9589 and proceeds of $40M. Series E shall convert with proceeds of $100M protection over common stocky

Senior liquidation protection ove

Seriesyes: Series A, B, C, D, E, E
Slack Preferred automatic conversion upon proceeds of no less than $30M F, and F-1 are all senior to Series D
Liquidation protection over comm
stockyes

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 8
 Multiple liquidation IPO auto convert
Dividends Participation
preference above per share price
Non-participating. However, pref. holders
8% non-cumulative dividends on all Series of pref.
er automatically convert to common if, as
A,B,C,D,D2 senior to Series 1. Pref. dividends also
o a result of the conversion, such holder No No. Converts at OIC
participate with common after they receive their
would receive a greater amount than if
preferential amount
they did not convert
Non-participating. However, pref. holders
er Non-cumulative dividends of $0.280464 Series A, $0.316 NO. Converts at the
automatically convert to common if, as
o Series B, $0.502128 Series C, $2.000168 Series D, and 8% applicable conversion
a result of the conversion, such holder No
over Series E. Pref. dividends also participate with common rate at the time in
would receive a greater amount than if
after they receive their preferential amount effect
they did not convert

er
Non-participating. However, pref. holders Yes. Series E = $17.98
have the right to convert to common if or 1.3 X OIP, Series D
A, 8% non-cumulative dividends on all series of pref. No
the remaining assets are greater than = $16.15 or 1.75 X OIP,
over
stated pref. liquidation amount Junior Series = $10

Non-cumulative dividends at the following rates: Seed =

C $0.17175. S-2 = $$0.0015. Series A = $0.024. Series B-1 = Yes for Series
Participating No
tion $0.07028. Series B-2 = $0.0312. Series B-3 = $0.14056. D-$10.46598.
Series C = $0.21353. Series D = $0.41864

Non-participating. However, pref. holders

are have the right to convert to common if
When declared by the Board of Directors No No
the remaining assets are greater than
stated pref. liquidation amount

Yes. Series A and

Yes. Series D = $100m
A1 get 1 x their OIP,
in proceeds. Series
Series B gets 2x
Non-cumulative: $3.0923 dividend for Series C, $3.6604 C = $70 million in
their OIP and Series
dividend for Series D, $1.7576 dividend for Series B, proceeds; Series
C gets 1.42857x
$0.0846 Series A and $0.2908 Series A1. Preferred Non-participating B = $50 million in
their OIP, Series D
yes also participates with common after they receive their proceeds; Junior
gets 1x their OIP
preferential amount Series (Series A and
before common
Series A1) = $18.1755
shareholders get
per share
paid

Series A gets 1x
Preferred non-cumulative dividends payable when
hare OIP, Series B gets 1x
declared by the Board of Directors (at a rate also
h, OIP, Series C gets Yes. Series E = 2x
declared by the Board) in preference over common stock. Participating
over $1.58646108. Series share price
Preferred participates with common after they receive
D gets $0.83248768.
their preferential amount
Series E gets 1x OIP
After initial
liquidation payout,
the preferred Series
participates with
Preferred non-cumulative dividends pari passu. Series
common until each Yes. A, A-1, B, and
A = $0.0626. Series A-1 = $0.0542. Series B = $0.0706.
Series receives an C convert at $4.41
Series B-1 = $0.0706. Series C = $0.1869. Series D =
Participating amount equal to 1.5 per share. Series D
$0.3711. Series E = $1.0506. Series F = $1.5274. Preferred
yes times the respective converts at $6.9589
also participates with common after they receive their
Series preference per share
preferential amount
amount. If assets
remain after that,
theyre distributed
to common
Non-cumulative dividends. Series A = $0.0076. Series
er Non-participating. However, pref. holders
B = $0.019767. Series C = $0.052767. Series D and D1 =
E-1, automatically convert to common if, as
$0.204. Series E = $0.477833. Series E-1 = $0.50208.
D1 . a result of the conversion, such holder No No. converts at OIP
Series F = $0.62416. Series F-1 = $0.62416. Pref. dividends
mon would receive a greater amount than if
also participate with common after they receive their
they did not convert
preferential amount

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 9
Unicorn IPO Protection Terms Acquisition Protection Terms

Pari passu (preferred shares

Series A, B, C, and D shall convert into Class A common; and Series E, F, and G shall convert into Class B
participate equally). Liquidation
common, upon proceeds of $75M
protection over common stocky

First, Series C. Second, Series B.

Preferred stock shall automatically convert into common at a sale to the public of a share price equal to Third, Series Seed and Series A
Magic Leap
at least 125% the Series C OIP, and at least $300M in gross proceeds on a pari passu basis. Liquidation
protection over common stocky

Series A, A1, B, B1, C, C1 all share

Preferred converts to common upon proceeds not less than $50M passu. Liquidation protection ove
common stockyes

Senior liquidation protection ove

Series-yes: Series C and D (toget
Converts at $70M proceeds pari passu) are senior to Series A
and B (also pari passu). Liquidatio
protection over common stocky

Senior liquidation protection ove

Series-yes: first Series C and C
Each share preferred automatically converts into Class A common at the then-effective conversion
(pari passu), second Series B, thir
price applicable at a price per share not less than $91.9892, and gross proceeds of $150M
Series A. Liquidation protection o
common stockyes

All series of preferred stock share

Each share Series A, B, D, E, and F automatically converts into common at the conversion rate then in
ratably in liquidation distribution
effect upon a public offering price not less than $15.7763 per share, and aggregate proceeds of not less
Liquidation protection over comm
than $100M.
stockyes
Social Finance

Series D ranks senior to all other

Series preferred converts to common (Series D to Class A Common, Series A, B, and C converts to
Series. Then, Series A, B, and C sh
Class B common) upon the closing of sale of shares at a price of at least $6.1255 per share, and gross
ratably in distribution. Liquidatio
proceeds of $50M
protection over common stocky
Each share preferred shall automatically convert into Class A common shares at the conversion rate at Series preferred share ratably in
the time in effect for such series upon the corporations sale of Class A common at not less than $50M liquidation distribution. Liquidati
in the aggregate protection over common stocky

Liquidation distributed as follows

first, Series E. Second, Series D. T
Each share preferred shall automatically convert into common upon a sale with an offering price of at
Series C. Fourth, Series A and B
least $37.03 per share, and aggregate proceeds of not less than $100M
share ratably. Liquidation protect
over common stockyes

Series D, E, F, G, and G (Senior

Preferred automatically converts into common at the then-effective conversion price (A) at any time Preferred) are paid out first, shar
upon the affirmative election of the holders of at least 66% of the outstanding shares of the Series ratably. Second, Series C is paid.
Preferred or (B) immediately upon the closing of a firmly underwritten public offering in which the per Third, Series A and B are paid rat
share price is at least $11 and proceeds at least $40M Liquidation protection over comm
stock-yes
Holders of Series A, B, C and D
receive liquidation preference on
Each share common and preferred shall automatically convert into common upon an IPO of $50M a pari passu basis before funds
aggregate are paid to FF preferred stock
and common stock. Liquidation
protection over common stocky

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 10
 Multiple liquidation IPO auto convert
Dividends Participation
preference above per share price
Non-participating. However, pref. holders NO. However, Series
8% non-cumulative dividends on all Series of pref. Pref.
have the right to convert to common if F has a liquidation
dividends also participate with common after they after No. converts at OIP
the remaining assets are greater than price much lower
yes they receive their preferential amount
stated pref. liquidation amount than OIP: $.0270
Non-cumulative dividends at the rate of $1.8426 Series
C, $0.9248 for Series B, $0.0954 for Series A, and
$0.0773 for Series seed. After payment is distributed to
YES, converts at 125%
preferred then additional dividends shall be distributed Non-participating No
n of the Series C OIP
to preferred and common in proportion to the # of shares
yes
of common that would be held by each such holder if all
shares of preferred were converted into common
Non-cumulative dividends at the rate of $0.013401
for Series A or A1, $0.110018 for Series B or B1, and
pari
$0.745054 for Series C and C1. After payment above,
er Non-participating No No, converts at OIP
additional dividends distributed among preferred,
founders, and common pro rata based on # of shares of
common then held by each holder
Non-cumulative corporation shall not declare any
er
dividends on shares of any other class or series of
her
capital stock of the corporation unless the holders of the
A Non-participating No No, converts at OIP
preferred then outstanding shall first or simultaneously
on
receive a dividend on each outstanding share of
yes
preferred stock
Each share preferred
automatically converts
er
into Class A common
Non-cumulative dividends at the rate of $0.314848 for
at the then-effective
rd Series A, $2.012024 for Series B, $3.679568 for Series C, Non-participating No
conversion price
over and $4.415480 for Series C
applicable at a price
per share not less than
$91.9892
Yes. Each share Series
A, B, D, E, and F
automatically converts
e
Cumulative dividends: Series R = $1.625. Non-cumulative into common at the
n.
dividends: Series A: $0.016. Series B: $0.17575. Series D: Non-participating No conversion rate then
mon
$0.27624. Series E: $0.756624. Series F: $1.262104 in effect upon a public
offering price not less
than $15.7763 per
share

hare Converts at Series D

Non-cumulative dividends of 8% on all series preferred Non-participating No
on OIP
yes

on Payable when declared by the board of directors Non-participating No No

yes
Series E shall be entitled to receive cumulative dividends
Yeseach share
prior and in preference to any other series of preferred
s: preferred shall
and the common stock at the rate of 8%. Second, Series
Third, automatically convert
D shall receive non-cumulative dividends at the annual
Non-participating No into common upon a
rate of $0.4476. Third, Series C shall receive non-
tion sale with an offering
cumulative dividends at the annual rate of $0.297. Fourth,
price of at least $37.03
Series A and B shall receive non-cumulative dividends (A:
per share
$0.0737, B: $0.195)

ring
Holders of series preferred, in preference to the holders
Yes, converts at a
of common stock, receive non-cumulative dividends of Participating No
ably. share price of $11
6.5%
mon

Non-participating. However, pref. holders

n
Series A, B, C, and D receive non-cumulative dividends of automatically convert to common if, as
$0.1085 for Series A, $0.294992 for Series B, $1.01753 for a result of the conversion, such holder No No
Series C, $1.955 for Series D would receive a greater amount than if
they did not convert
yes

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 11
Unicorn IPO Protection Terms Acquisition Protection Terms

All series preferred receive their O

and share ratably upon liquidatio
Preferred converts to common automatically upon an IPO with proceeds not less than $100M aggregate
Liquidation protection over comm
stock-yes

Upon the earlier of (A) the closing of the sale of shares of Class A common resulting in at least $30M
of gross proceeds, net of the underwriting discount and commissions, to the corporation at a price
Preferred payout on pari passu b
per share that is not less than 1.25x the Series C OIP, or (B) a date specified by vote or consent of
Liquidation protection over comm
the holders of preferred stock representing a majority of the combined voting power of the then
stock-yes
outstanding shares of preferred stock, all outstanding shares of preferred stock shall automatically be
Flatiron Health
converted into shares of Class A common at the then-effective conversion rate.

Preferred automatically converts into Class A common at the then-effective conversion price upon the
Preferred payout on pari passu b
earlier (1) of a vote by the majority of preferred stock or (2) upon the closing of a firmly underwritten
Liquidation protection over comm
public offering covering the offer and sale of Class A common at a price per share of not less than
stock-yes
Thumbtack $12.765, with aggregate gross proceeds of not less than $100M

First, Series D ranks senior to all

other Series. Second, Series A, B,
Pref converts to common automatically upon sale of share price at least equal to the Series C OIP C shall receive liquidation payout
($1.67473) and proceeds not less than $50M aggregate sharing ratably with each other.
Liquidation protection over comm
stock-yes

First, Series E is paid. Second, Se

D. Third, Series C. Fourth, Series
Preferred automatically converts to common upon a qualified IPO equal to or greater than $50M, or B. Fifth, Series A. Any additional
upon the date specified by written consent of the holders of 60% or more of the then outstanding funds and assets distributed amo
shares of preferred, and the holders of 60% or more of the then-outstanding share of Series E the outstanding common stock.
Liquidation protection over comm
stock-yes

Upon either (a) the closing sale of shares of Common Stock to the public resulting in at least $150M
gross proceeds, or (b) the date and time, or the occurrence of an event, specified by vote or written
Preferred stock pari passu senior
consent of the holders of at least (i) 60% of the then outstanding shares of Series D and (ii) at least 65%
common stock
of the then outstanding Preferred Stock, all outstanding shares of Preferred Stock shall automatically be
converted into shares of Common Stock at the then-effective conversion rate

Preferred automatically converted to common upon the closing of sale of common to the public of at Preferred series receive their OIP
least $50M in gross proceeds, or the date, time, or occurrence of an event specified by vote or consent and share ratably in distribution.
of the holders of a majority of the outstanding shares of preferred on an as-converted to common stock Liquidation protection over comm
basis stockyes
Github

Preferred stock shall automatically be converted into, (A) in the case of Series seed, Class A common or
Preferred receive an amount equ
(B) in the case of all other Series of preferred stock, common stock at the then-effective conversion rate,
to OIP, pari passu senior to comm
(i) immediately prior to the closing of a firm commitment covering the offer and sale of common stock
stock
and/or Class A common stock and resulting in aggregate gross proceeds of not less than $30M
Sale of common resulting in at least $20M to the corporation and resulting in the an equity market
capitalization , on the first day of trading of such offering of not less than $100M, all outstanding shares
of preferred stock shall automatically be converted into shares of common stock at the then-effective Preferred receive an amount equ
conversion rate (except (1) Series D2 unless the qualified public offering shall have a price per share to OIP, pari passu senior to comm
equal to or greater than the Series D2 OIP and (2) solely in the event of a qualified public offering stock
Sprinklr occurring within 15 months from the original issue date applicable to Series F resulting in an initial equity
market capitalization of less than $1,750M

Each share preferred shall automatically convert to common at the conversion price at the time in effect
upon gross proceeds from an IPO of not less than $100M in the aggregate, and a price per share which Series A receives their OIP
when multiplied by the aggregate number of shares of common stock outstanding yields a product of ($51.600823) prior and in prefere
not less than $750M, or the date specified by vote or consent of the holders of a majority of the then to common
outstanding shares of Series A

Each share of Series Preferred shall automatically be converted into shares of Class B common stock,
based on the then-effective series preferred conversion price, (A) at any time upon the affirmative Preferred receive an amount equ
election of the holders of at least two thirds of the outstanding shares of series preferred; or (B) to OIP, pari passu senior to comm
immediately upon the closing of a firmly underwritten public offering, covering the offer and sale of stock
Class A common stock in which the gross cash proceeds to the company are at least $50M

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 12
 Multiple liquidation IPO auto convert
Dividends Participation
preference above per share price
Preferred Series receive non-cumulative dividends of
Non-participating. However, pref. holders
OIP $0.0451 for Series A, $0.0450 for Series B, $0.1913 for
automatically convert to common if, as
on. Series C, $0.5691 for Series D, and $0.8079 for Series E.
a result of the conversion, such holder No No
mon Preferred have priority over common and after theyre
would receive a greater amount than if
paid their preference amounts, they share with common
they did not convert
for any additional dividends

Holders of preferred stock receive non-cumulative at:

basis. Yesprice per share of
Series A = $0.395; Series B = $0.1869; and Series C =
mon No No not less than 1.25x the
$0.5247 on a pari passu basis in preference to common
Series OIP
stock

Holders of preferred stock receive non-cumulative

basis. at: Series A = $0.00658064; Series B = $0.013068;
Yes, price per share
mon Series C = $0.0191952; Series D = $0.03899408; Series No No
not less than $12.765
E = $0.016012; Series F = $0.4666064; and Series G =
$0.6808 in preference to common stock

Preferred Series receive non-cumulative dividends on a

, and
pari passu basis of 6% per annum. If after full dividends
t NO, converts at Series
have been paid to preferred and there are additional Non-participating No
C OIP ($1.67473)
dividends left, they should be paid pro rata to common
mon
and preferred on pari passu basis

$0.07545 = Series A; $0.1842 = Series B; $0.189 = Series

C; $0.2429 = Series D; $0.64964 = Series E. Series E
eries
has preference and receives dividends first. Second
Non-participating. However, pref. holders
Series D receives dividends. Third, Series C receives
automatically convert to common if, as
dividends. Fourth, Series B receives dividends. Fifth,
ong a result of the conversion, such holder No no, converts at OIP
Series A receives dividends. If after all dividends in full
would receive a greater amount than if
preferential amounts have been paid to preferred stock
mon they did not convert.
there are additional dividends remaining, they shall be
paid pro rata to the common stock and preferred stock
on a pari passu basis

Holders of Preferred Stock receive non-cumulative

r to at: Series A = $0.1073; Series B = $0.24112; Series C =
No No No
$0.58516; and Series D = $1.77826 in preference to
common stock

Preferred Series receive non-cumulative dividends at

P 6%. OIP = $5.22361 Series A, $11.17333 Series B. After
they receive their preference amounts and there are
Non-participating No No
mon more funds available, then additional dividends shall be
declared pro rata on common and preferred on a pari
passu basis

ual Preferred receive non-cumulative at: Series Seed =

mon $0.01862; Series A = $0.76804, Series B = $28140; and No No No
Series C = $5.0246

All of the remaining proceeds available

ual
for distribution to stockholders shall be
mon Preferred pari passu, senior to common stock No No
distributed among the holders of shares
of Series C, Series B and common stock

Converts at a price
per share which when
Series A receives non-cumulative dividends at the rate multiplied by the
of $4.128 per share per annum. After full payment to aggregate number
ence Non-participating No
Series A, Series A participates with common in additional of shares of common
distribution of dividends stock outstanding
yields a product of not
less than $750M

ual
Preferred receive non-cumulative at 8% senior to
mon Non-participating No No
common stock

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 13
Unicorn Statistics
VC raised in last 18 months VC raised in last 12 VC raised in 2016 # of # of active
Company
($M) in US months ($M) in US YTD ($M) in US employees investors

Uber Technologies $8,750 $7,750 $7,750 6,700 101

Jet $3,795 $3,790 $3,300 1,001 18

Airbnb $3,450 $3,450 $1,850 4,227 55

Snapchat $2,009 $1,809 $1,809 904 38

Lyft $1,828 $1,148 $1,000 4,105 58

Palantir Technologies $883 $883 $883 2,000 54

WeWork $864 $430 $430 1,200 16

Avant $828 $689 $189 800 13

Magic Leap $794 $794 $794 600 17

Pivotal Software $653 $653 $653 2,000 5

Oscar $577 $433 $400 342 28

DraftKings $500 $0 $0 333 31

Moderna $471 $471 $471 440 13

Jawbone $465 $165 $165 393 34

Slack Technologies $367 $200 $200 430 36

Domo $366 $366 $366 906 48

Apttus $363 $363 $255 1,184 4

Human Longevity $220 $220 $220 146 20

Zoox $200 $200 $200 140 4

SMS Assist $195 $150 $150 585 11

Unity Technologies $181 $181 $181 1,000 12

Flatiron Health $175 $175 $175 250 19

Sprinklr $151 $105 $105 1,243 6

Cylance $142 $100 $100 425 13

Carbon3D $141 $41 $41 153 11

Gusto.com $127 $67 $67 303 106

Anaplan $90 $90 $90 567 15

Quanergy $90 $90 $90 42 14

Alphaeon $86 $86 $6 201 5

Razer $75 $75 $75 501 4

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 14
 VC raised in last 18 months VC raised in last 12 VC raised in 2016 # of # of active
Company
($M) in US months ($M) in US YTD ($M) in US employees investors

Elevance Renewable Sciences $71 $71 $71 133 9

Proteus Digital Health $50 $50 $50 257 20

Glassdoor $40 $40 $40 722 11

Deem $34 $34 $34 250 24

Bloom Energy $11 $11 $3 925 29

SpaceX $5 $5 $5 4,000 21

Source: PitchBook
*As of 8/31/2016

Unicorns (#) by sector in US

Commercial Services

7
5
Consumer Goods & Recreation
No fewer than 290 unique investors
2
3
Energy
invested at the angel/seed stage of
all current US unicorns, although
5 Healthcare
Services/Supplies/Systems
5 IT Hardware
54
Media
over 100 more invested at Series A,
21 Other
excluding follow-ons.
5 Pharma & Biotech

Software
Source: PitchBook
*As of 8/31/2016

Series when companies became unicorns in US Series when investors (#) first invested in unicorns in US

Series E
Series D, 259
21%
Series C, 306

Series D Series E, 193

26% Series F
12%
Series B, 303 Series F, 158
Series G
Series G, 63
5%
Series H, 5
Series H, 1% Series I, 6
Series A Series K, 11
Series C 2%
Series B Angel/Seed,
18% Series A, 392
15% 290

Source: PitchBook Source: PitchBook

*As of 8/31/2016 *As of 8/31/2016

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 15
Unicorn League Tables
Investors in the most unicorns in US
GGV Capital 7 IT Ventures 5
Fidelity Investments 24
Jeremy Stoppelman 7 Elad Gil 5
SV Angel 23 BlackRock Private Equity
7 Felicis Ventures 5
Partners
Sequoia Capital 20
In-Q-Tel 5
Dave Morin 7
Andreessen Horowitz 20
Allen & Company 5
David Sacks 7
T. Rowe Price 17
AME Cloud Ventures 5
Bezos Expeditions 7
Kleiner Perkins Caufield &
16 Cross Culture Ventures 5
Byers SharesPost 6
Wellington Management 14 Battery Ventures 5
Troy Carter 6
GV 14 BoxGroup 5
Surender Punia 6
The Goldman Sachs Group 13 Source: PitchBook
The Hartford Financial
6 *As of 8/31/2016
Services Group
New Enterprise Associates 13
Morgan Stanley Expansion
6
Investors with most eventual
Tiger Global Management 12 Capital
unicorns at angel/seed in US
MicroVentures 6
Khosla Ventures 12
Y Combinator 4
Lowercase Capital 6
IVP 12
Andreessen Horowitz 3
Kevin Hartz 6
Founders Fund 12
Sequoia Capital 2
Microsoft 6
Accel Partners 12
Transmedia Capital 2
DST Global 6
Salesforce Ventures 11
SV Angel 2
Intel Capital 6
General Catalyst Partners 11 Source: PitchBook
*As of 8/31/2016
Jerry Yang 6
Insight Venture Partners 10
Dragoneer Investment Group 6 Investors with most eventual
Greylock Partners 10
DFJ Growth 6 unicorns at Series A in US
Comcast Ventures 10
GSV Capital 6 SV Angel 10
Benchmark Capital 10
Coatue Management 6 Accel Partners 7
Lightspeed Venture Partners 9
Baillie Gifford 6 Sequoia Capital 6
Glynn Capital Management 9
Vinod Khosla 5 Benchmark Capital 5
Ronald Conway 8
Slow Ventures 5 Lightspeed Venture Partners 5
Thrive Capital 8
VSL Partners 5 Andreessen Horowitz 5
Meritech Capital Partners 8
Valiant Capital Partners 5 First Round Capital 5
Duff Ackerman & Goodrich 8
Venrock 5 New Enterprise Associates 4
Google Capital 8
Technology Crossover Khosla Ventures 4
TPG Growth 7 5
Ventures
General Catalyst Partners 4
Michael Cheung 7 Peter Thiel 5
Greylock Partners 3
General Atlantic 7 Nima Capital 5
Hummer Winblad Venture
ICONIQ Capital 7 Kevin Colleran 5 3
Partners

First Round Capital 7 QED Investors 5 Draper Fisher Jurvetson 3

Source: PitchBook
Draper Fisher Jurvetson 7 MD Pham 5
*As of 8/31/2016

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 16
Investors with most eventual Investors with most eventual
GGV Capital 2
unicorns at Series B in US unicorns at Series C in US
Andreessen Horowitz 2
Sequoia Capital 5 Founders Fund 5
Greylock Partners 2
IVP 5 Salesforce Ventures 4
Team in Residence 2
Andreessen Horowitz 5 Meritech Capital Partners 4
In-Q-Tel 2
General Catalyst Partners 5 Kleiner Perkins Caufield &
4
Byers Wellington Management 2
SV Angel 4
Comcast Ventures 4 Source: PitchBook
*As of 8/31/2016
Greylock Partners 4
Fidelity Investments 4
The Goldman Sachs Group 4
Investors with most eventual
Sequoia Capital 4
unicorns at Series D in US
Benchmark Capital 4
Battery Ventures 3
Fidelity Investments 8
Fidelity Investments 3
Insight Venture Partners 3
Kleiner Perkins Caufield &
5
Felicis Ventures 3 Byers
Allen & Company 3
Khosla Ventures 3 T. Rowe Price 5
Thrive Capital 3
Menlo Ventures 2 GV 5
Khosla Ventures 3
Thrive Capital 2 DFJ Growth 3
SV Angel 3
Morgan Stanley Expansion
Ribbit Capital 2 3
GV 3 Capital

Insight Venture Partners 2 Duff Ackerman & Goodrich 3

Tiger Global Management 3
Northgate Capital 2 Coatue Management 3
Thomvest Ventures 2
BlackRock Private Equity Credit Suisse 3
2 Principal Financial Group 2
Partners

Shasta Ventures 2 Morgan Stanley Expansion TPG Growth 3

2
Capital
BoxGroup 2 Milliways Ventures 2
Bezos Expeditions 2
BlackRock Private Equity
Venrock 2 2
TPG Growth 2 Partners

CrunchFund 2 Alibaba Capital Partners 2

BoxGroup 2
Alibaba Capital Partners 2 New Enterprise Associates 2
Lightspeed Venture Partners 2
Redpoint Ventures 2 Glynn Capital Management 2
Capital Factory 2
Founders Fund 2 QED Investors 2
Nima Capital 2
Temasek Holdings 2 Google Capital 2
DFJ Growth 2
GGV Capital 2 Microsoft 2
Stripes Group 2
US Venture Partners 2 GSV Capital 2
Dragoneer Investment Group 2
Great Oaks Venture Capital 2 DST Global 2
Valor Capital Group 2
ICONIQ Capital 2 The Kraft Group 2
Draper Associates 2
Kleiner Perkins Caufield & Passport Capital 2
2 JP Morgan Chase & Co. 2
Byers
Source: PitchBook Technology Crossover
Draper Nexus 2 2
*As of 8/31/2016 Ventures

Microsoft 2 Pinnacle Ventures 2

Duff Ackerman & Goodrich 2 The Goldman Sachs Group 2

New Enterprise Associates 2 Sapphire Ventures 2

Foresite Capital Management 2 Baillie Gifford 2

Polaris Partners 2 Dragoneer Investment Group 2

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 17
Investors with most eventual Investors with most eventual Investors with most eventual
unicorns at Series D in US, ctd. unicorns at Series F in US unicorns at Series G in US

Kohlberg Kravis Roberts 2 T. Rowe Price 5 Morgan Stanley 2

Brookside Capital 2 Wellington Management 4 The Goldman Sachs Group 2

Wellington Management 2 Meritech Capital Partners 3 Lance White 2

Source: PitchBook
Viking Global Investors 2 General Atlantic 3
*As of 8/31/2016

Ignition Venture Partners 2 The Goldman Sachs Group 3

Investors with most eventual
Industry Ventures 2 Fidelity Investments 3
unicorns at Series H and later in US
Y Ventures 2 Glynn Capital Management 3
Broad Beach Ventures 1
Source: PitchBook
IT Ventures 2
*As of 8/31/2016
T. Rowe Price 1
SV Angel 2
Investors with most eventual MicroVentures 1
Microsoft 2
unicorns at Series E in US Third Point Ventures 1
Altimeter Capital
2
Tiger Global Management 5 Management Mithril Capital Management 1
EDB Investments 2
Wellington Management 4 GSV Ventures 1
Citi Ventures 2 BlackRock Private Equity
Fidelity Investments 4 1
Partners
Cross Creek Advisors 2
General Atlantic 4
Hercules Capital 1
The Hartford Financial
IVP 3 2
Services Group Seed-Resolute 1
T. Rowe Price 2 SharesPost 2
Aeon Funds 1
New Enterprise Associates 2 Tiger Global Management 2
TJNS Capital 1
Kleiner Perkins Caufield & Deutsche Telekom Capital
2 2 Dover Madison Capital
Byers Partners 1
Management
Draper Fisher Jurvetson 2 HDS Capital 2
Rising Tide Fund 1
Sands Capital Ventures 2 Intel Capital 2
FJ Labs 1
DST Global 2 Graphene Ventures 2
Tamares 1
Comcast Ventures 2 VSL Partners 2
IT Ventures 1
Source: PitchBook
Alibaba Group Holding 2
*As of 8/31/2016 VSL Partners 1
Lakestar 2
MD Pham 1
Fidelity Management &
2 Nima Capital 1
Research

Salesforce Ventures 2 Source: PitchBook

*As of 8/31/2016
Andreessen Horowitz 2

GGV Capital 2

The Hartford Financial

2
Services Group

Baidu 2

J.P. Morgan 2

Source: PitchBook
*As of 8/31/2016

P I TC H B O O K 201 6 VC U N I CO R N R E P O R T 18
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