NVCA 2013 Yearbook PDF

NATIONAL
VENTURE
CAPITAL
ASSOCIATION
YEARBOOK 2013
NATIONAL VENTURE CAPITAL ASSOCIATION YEARBOOK 2013
PREPARED BY
3 Times Square 1655 Fort Myer Drive
18th Floor Suite 850 INCLUDING STATISTICS FROM THE
New York, NY 10036 Arlington, VA 22209 PricewaterhouseCoopers/National Venture Capital Association
www.thomsonreuters.com www.nvca.org MoneyTree™ Report based on data from Thomson Reuters
March 2013
Dear Reader:
These are interesting times characterized by economic and political uncertainty - and little forward
motion. And yet in the entrepreneurial section of the economy, the opportunities to create great
companies remain unabated. There is wide agreement among policy makers on the importance of
entrepreneurial companies to economic growth and well-being. Venture capital is a major driver of
that entrepreneurial economy. The nation continues to look to this sector for job creation, economic
development, better healthcare, cleaner technology, and a faster, better, and more secure internet.
The NVCA Yearbook 2013, prepared by Thomson Reuters, is the 16th iteration of a series launched
in early 1998 by NVCA and what is now Thomson Reuters. Since then we have joined forces with
PricewaterhouseCoopers to provide the best possible information on venture capital deals across all
50 states. This investment information is tracked and reported by the PricewaterhouseCoopers/NVCA
MoneyTreeTM Report based on data from Thomson Reuters.
On behalf of the National Venture Capital Association board of directors and staff, we are pleased to
present you with the latest statistics that describe the activity of the venture capital industry in the
United States. These statistics reflect strong survey participation by venture capital practitioners.
This support has allowed us to bring appropriate transparency to a part of the economy that most
people are aware of but few really understand. Your comments are always welcome at
research@nvca.org.
NVCA believes that it is more important than ever to effectively tell the story of venture capital, dif-
ferentiate it from other forms of alternative assets, and explain what’s needed to continue creating
great, leading-edge companies. We believe that a strong venture capital industry is essential to
America’s future and our quality of life. NVCA is proud to be funding innovation and empowering
entrepreneurs!
Very truly yours
Diana Frazier Mark G. Heesen John S. Taylor

FLAG Capital Management NVCA President NVCA Head of Research
NVCA Director & Chair,
NVCA Research Committee
NVCA BOARD OF DIRECTORS 2012-2013
Executive Committee
Ray Rothrock Josh Green

Chair Chair-Elect
Venrock Associates Mohr, Davidow Ventures
Michael Greeley Jonathan Leff

Treasurer At-Large & Research Committee
FlyBridge Capital Partners Deerfield Management
Jason Mendelson Scott Sandell

At-Large At-Large
Foundry Group New Enterprise Associates
Research Committee
Diana Frazier Mike Elliott

Chair, Research Committee Noro-Moseley Partners
FLAG Capital Management, LLC
Adam Grosser
Silver Lake Kraftwerk
Board Members At-Large
Jonathan Callaghan Maria Cirino

True Ventures .406 Ventures
David Douglass Bruce Evans

Delphi Ventures Summit Partners
Claudia Fan Munce Norm Fogelsong

IBM Venture Capital Group Institutional Venture Partners
Venky Ganesan Robert Goodman

Menlo Ventures Bessemer Venture Partners
Mark Gorenberg Jason Green

Hummer Winblad Venture Partners Emergence Capital Partners
Ross Jaffe, MD Ray Leach

Versant Ventures Jumpstart, Inc.
Sherrill Neff Robert Nelsen

Quaker BioVentures ARCH Venture Partners
David Lincoln James Marver

Element Partners VantagePoint Capital Partners
Anne Rockhold
Accel Partners
2 Thomson Reuters
2013
National Venture Capital Association
Yearbook
For the National Venture Capital Association
Prepared by Thomson Reuters
Copyright © 2013 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 dis-
claims any liability including incidental or consequential damages arising from
errors or omissions in this report.
Thomson Reuters 3
National Venture Capital Association 2013 Yearbook
National Venture Capital Association Thomson Reuters

1655 Fort Myer Drive, Suite 850 3 Times Square, 18th Floor
Arlington, Virginia 22209-3114 New York, NY 10036
Telephone: 703-524-2549 Telephone: 646-223-4431
Telephone: 703-524-3940 Fax: 646-223-4470
www.nvca.org www.thomsonreuters.com
Global Head of Deals & Private Equity

President Stephen N. Case II
Vice President, Deals and Private Equity Operations
Mark G. Heesen
Head of Research Shariq Kajiji
Global Business Manager – Private Equity
John S. Taylor
Senior Vice President Jim Beecher
Editor-in-Charge
Molly M. Myers
Senior Vice President of Federal Policy & Political
Advocacy
David Toll
Jennifer Connell Dowling Global Private Equity Operations Manager
Vice President of Communications

Anna Aquino-Chavez
Emily Mendell Press Management
Vice President of Membership & Member Firm

Matthew Toole
Liaison Product Manager

Janice Mawson Lori Ann Silva
Vice President of Federal Policy & Political Advocacy Content Specialist

Emily A. Baker Paul Pantalla
Chief Marketing Officer Data Specialist

Jeanne Lazarus Metzger Francis Base
Vice President of Federal Life Science Policy Research Editor

Kelly Slone Eamon Beltran
Membership and Database Manager Senior Art Director

Terry Samm David Cooke
Manager of Administration and Meetings Sales Manager – Publications (Buyouts, VCJ, peHUB)
Allyson Chappell Greg Winterton (646-223-6787)
Accounting Manager ThomsonONE.com Sales:

Beverley Badley Dave Sharma (646-223-4048)
Administrative Assistant
Gwendolyn Taylor
Research Lab
Mavis Moulterd, Thea Shepherd
4 Thomson Reuters
Table of Contents
What is Venture Capital? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Industry Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . 11
Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Exits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . 15
Industry Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . 17
Capital Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Investments.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Exits: IPOs and Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
Appendix A: Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Appendix B: MoneyTree Report Criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Appendix C: MoneyTree Geographical Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Appendix D: Industry Codes (VEICs). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
Appendix E: Industry Sector VEIC Ranges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
Appendix F: Stage Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Appendix G: Data Sources and Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Appendix H: International Convergence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
Appendix I: US Accounting Rulemaking and Valuation Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105
Appendix J: Non-US Private Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
Thomson Reuters 5
This page is intentionally left blank.
6 Thomson Reuters
What is Venture Capital?
Venture capital has enabled the United States to sup-

port its entrepreneurial talent and appetite by turning Venture Capital Backed Companies
ideas and basic science into products and services Known for Innovative Business Models
Employment at IPO and Now
that are the envy of the world. Venture capital funds
build companies from the simplest form – perhaps Company As of IPO Current # Change
just the entrepreneur and an idea expressed as a busi- The Home Depot 650 331,000 330,350
Starbucks Corporation 2,521 160,000 157,479
ness plan – to freestanding, mature organizations. Staples 1,693 89,019 87,326
Risk Capital for Business

Whole Foods Market, Inc. 2,350 69,500 67,150
eBay 138 31,500 31,362
Venture Capital Backed Companies

Venture capital firms are professional, institutional Known for Innovative Technology and Products
managers of risk capital that enables and supports the Employment at IPO and Now
most innovative and promising companies. This
Company As of IPO Current # Change
money funds new ideas that could not be financed Microsoft 1,153 94,000 92,847
with traditional bank financing, that threaten estab- Intel Corporation 460 100,100 99,640
lished products and services in a corporation, and that Medtronic, Inc. 1,287 45,000 43,713
Apple Inc. 1,015 76,100 75,085
typically require five to eight years to be launched. Google 3,021 53,861 50,840
JetBlue 4,011 12,070 8,059
Venture capital is quite unique as an institutional
Source: Global Insight; Updated from ThomsonOne 2/2013
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 companies have received funding but no one- or two-
company matures five to eight years down the road. person company has ever gone public! Along the way,
Follow-on investment provides additional funding as talent must be recruited and the company scaled up.
the company grows. These “rounds,” typically occur- Ask any venture capitalist who has had an ultra-suc-
ring every year or two, are also equity investment, with cessful investment and he or she will tell you that the
the shares allocated among the investors and manage- company that broke through the gravity evolved from
ment team based on an agreed “valuation.” But, unless the original business plan concept with the careful
a company is acquired or goes public, there is little input of an experienced hand.
actual value. Venture capital is a long-term investment.
Deal Flows — Where The Buys Are
More Than Money
For every 100 business plans that come to a venture
The U.S. venture industry provides the capital to cre- capital firm for funding, usually only 10 or so get a
ate some of the most innovative and successful com- serious look, and only one ends up being funded. The
panies. But venture capital is more than money. venture capital firm looks at the management team,
Venture capital partners become actively engaged the concept, the marketplace, fit to the fund’s objec-
with a company, typically taking a board seat. With a tives, the value-added potential for the firm, and the
startup, daily interaction with the management team is capital needed to build a successful business. A busy
common. This limits the number of startups in which venture capital professional’s most precious asset is
any one fund can invest. Few entrepreneurs approach- time. These days, a business concept needs to address
ing venture capital firms for money are aware that world markets, have superb scalability, be made suc-
they essentially are asking for 1/6 of a person! cessful in a reasonable timeframe, and be truly inno-
vative. A concept that promises a 10 or 20 percent
Yet that active engagement is critical to the success of improvement on something that already exists is not
the fledgling company. Many one- and two-person likely to get a close look.
Thomson Reuters 7
Many technologies currently under development by

venture capital firms are truly disruptive technologies The Exit Funnel
Outcomes of the 11,686 Companies
that do not lend themselves to being embraced by First Funded 1991 to 2000
larger companies whose current products could be
cannibalized by this. Also, with the increased empha- Went/Going Public
14%
sis on public company quarterly results, many larger
Still Private
organizations tend to reduce spending on research and or Unknown*
development and product development when things 35%
get tight. Many talented teams have come to the ven- Acquired
33%
ture capital process when their projects were turned
down by their companies.
Common Structure — Unique Results Known Failed

18%
While the legal and economic structures used to cre- *Of these, most have quietly failed
ate a venture capital fund are similar to those used by

other alternative investment asset classes, venture cap- pre-agreed formula. Many college endowments, pen-
ital itself is unique. Typically, a venture capital firm sion funds, charities, individuals, and corporations
will create a Limited Partnership with the investors as have benefited far beyond the risk-adjusted returns of
LPs and the firm itself as the General Partner. Each the public markets.
“fund,” or portfolio, is a separate partnership. A new
fund is established when the venture capital firm
Beyond the IPO
obtains necessary commitments from its investors, say
$100 million. The money is taken from investors as Many of the most exciting venture capital backed
the investments are made. Typically, an initial funding companies left the venture portfolios after they went
of a company will cause the venture fund to reserve public. Far from being a destination, the IPO process
three or four times that first investment for follow-on provides needed growth capital for a growing compa-
financing. Over the next three to eight or so years, the ny. A 2009 analysis by IHS Global Insight shows that
venture firm works with the founding entrepreneur to more than 90% of the jobs at today’s venture backed
grow the company. The payoff comes after the compa- public companies were created after it went public.
ny is acquired or goes public. Although the investor That is, these companies on average are 10% of their
has high hopes for any company getting funded, only mature size at the time they go public.
one in six ever goes public and one in three is
What’s Ahead
acquired.
Economic Alignment of all Stakeholders — Much of venture capital’s success has come from the
An American Success Story
entrepreneurial spirit pervasive in the American culture,
financial recognition of success, access to good science,
Venture capital is rare among asset classes in that suc- and fair and open capital markets. It is dependent upon
cess is truly shared. It is not driven by quick returns or a good flow of science, motivated entrepreneurs, protec-
transaction fees. Economic success occurs when the tion of intellectual property, and a skilled workforce.
stock price increases above the purchase price. When
a company is successful and has a strong public stock The nascent deployment of venture capital in other
offering, or is acquired, the stock price of the compa- countries is gated by a country’s or region’s cultur-
ny reflects its success. The entrepreneur benefits from al fit, tolerance for failure, services infrastructure
appreciated stock and stock options. The rank and file that supports developing companies, intellectual
employees throughout the organization historically property protection, efficient capital markets, and
also do well with their stock options. The venture cap- the willingness of big business to purchase from
ital fund and its investors split the capital gains per a small companies.
8 Thomson Reuters
Executive Summary
During 2012, many of the metrics describing the venture capital industry in the United States were similar to
those of the prior two years. The decline in the number of firms and capital managed was expected but not as
large as some were anticipating. Venture investment focused on companies in the seed and early stages, with
many later-stage companies continuing to await a helpful IPO environment. Investment in early-stage life sci-
ence companies continues to soften.
Fundraising remained very challenging for the majority of venture firms, largely because of a dearth of healthy
exits that would distribute yet-unrealized returns to current fund investors. The number of initial public offer-
ings in 2012 fell slightly from 2011 levels, but the proceeds and IPO valuation tally were both up significant-
ly, largely as a result of one huge IPO and a handful of large ones.
A healthy venture capital ecosystem requires its metrics to be in balance. And while the quality of new business
opportunities, known as deal flow, remains very high and the best opportunities are getting funded, stresses
remain.
Introduction the ThomsonONE.com (formerly VentureXpert)

database of Thomson Reuters, which has been
The National Venture Capital Association 2013 endorsed by the NVCA as the official industry activ-
Yearbook provides a summary of venture capital ity database. Subscribers to ThomsonONE can recre-
activity in the United States. This ranges from invest- ate most of the charts in this publication and report
ments into portfolio companies to capital managed individual deal detail and more granular statistics
by general partners to fundraising from limited part- than provided herein.
ners to exits of the investments by either IPOs or
mergers and acquisitions. The statistics for this pub-
lication were assembled primarily from the
Industry Resources
MoneyTree™ Report by PricewaterhouseCoopers The activity level of the U.S. venture capital industry
and the National Venture Capital Association, based is roughly half of what it was at the 2000-era peak.
on data from Thomson Reuters and analyzed through For example, in 2000, 1053 firms each invested $5
million or more during the year. In 2012, the count
Figure 1.0 was less than half that at 522.
Venture Capital Under Management
Summary Statistics Venture capital under management in the United
1992 2002 2012 States by the end of 2012 decreased to $199.2 billion
No. of VC Firms in Existence 358 1,089 841 as calculated using the methodology described
No. of VC Funds in Existence 616 2,119 1,269 below. However, looking behind the numbers, we
No. of Principals 4,996 14,541 5,887 know that the industry continues to contract from the
No. of First Time VC Funds Raised 13 25 43 circa 2000 bubble high of $261.2 billion
No. of VC Funds Raising Money This Year 78 176 162
VC Capital Raised This Year ($B) 4.9 15.7 20.1 The slight downtick in number of firms and capital
VC Capital Under Management ($B) 28.7 272.1 199.2 managed in 2012 perhaps understates a consolidat-
Avg VC Capital Under Mgt per Firm ($M) 80.2 249.9 236.9 ing trend. The average venture capital firm shrunk to
Avg VC Fund Size to Date ($M) 39.1 94.4 110.6 7.0 principals per firm from 7.4 in 2011. The corre-
Avg VC Fund Size Raised This Year ($M) 62.8 89.2 124.1
sponding drop in headcount to under 6,000 princi-
Largest VC Fund Raised to Date ($M) 1,775.0 6,300.0 6,300.0
pals is almost one-third lower than 2007 levels. This
Thomson Reuters 9
10
($ Billions)
60
100
80
0
20
120
40
198 ($ Billions)
5
50
100
350
250
0
200
300
150
198
6
198
198
7 5
198
198
8 6
198
198 7
9 198
199 8
0 198
9
199
1 199
0
199
2 199
1
199 199
3 2
199 1993
4
199
199
5 4
199
199 5
6 199
199 6
7 1997
199
8 199
8
Figure 3.0
Figure 2.0
Year
199
1985 to 2012
1985 to 2012
9 199
Year
9
200 200
0 0
Capital Commitments to
2 00 200
1
Capital Under Management
U.S. Venture Funds ($ Billions)

200
200
2 2
200
200
3
3
200
2 00 4
4 200
200 5
5 200
200 6
6 200
7
200 200
7 8
2 00 200
8 9
200 201
9 0
201
2 01
0 1
201
201 2
1
201
2
Thomson Reuters
2013 NVCA Yearbook
Figure 4.0
Investments in
Portfolio Companies ($ Billions)
1985 to 2012
120
100
80
($ Billions)
60
40
20
9
7
1
1
1
0
6
8
9
9
5
0
4
8
2
7
5
7
2
3
8
0
5
2
201
199
200
200
2 00
200
200
198
199
199
199
198
199
198
200
200
199
199
199
199
200
199
200
200
198
201
198
201
Year
Figure 5.0
Venture Capital Investments in 2012
By Industry Group
All Investments Initial Investments

Investment Investment
Industry Group # Companies # Deals Amt ($Bil) # Companies # Deals Amt ($Bil)
Information Technology 2,130 2,480 16.5 870 870 3.0
Medical/Health/Life Science 649 818 6.8 148 148 0.7
Non-High Technology 364 425 3.4 156 156 0.4
Total 3,143 3,723 26.7 1,174 1,174 4.1
meant that there was an increase in the average seen in 2005-2007 and approximately one-fifth of the
amount of capital managed by each principal. It is annual amount raised at the bubble peak.
possible going forward, that the number of principals
per firm will increase as the number of firms When you look behind the 2012 capital commitments
decreases. This is because the bulk of the money at the specific funds being raised, the 10 largest funds
being raised today is being raised by larger, special- represent 48% of the capital raised, with 173 funds
ty, and boutique firms. raising the other 52%.
This is the sixth consecutive year in which more

Commitments money was invested by the industry than raised in
New commitments to venture capital funds in the new commitments. That has been the case in 11 of
United States increased for the second year in a row, the past 13 years. While this is not a true apples-to-
which follows four years of declines. In 2012, com- apples comparison, it does explain the industry’s
mitments totaling $20.1 billion were made to 183 strong interest in raising additional funds in 2013
funds. This is roughly two-thirds of the annual levels and beyond. The narrow success of recent IPO and
Thomson Reuters 11
Figure 6.0
Stage by Dollars Invested
Seed 3%
Later Stage 32%

Early Stage 30%
Expansion 35%
Figure 7.0
Industry Sector by Dollars Invested
Telecommunications 2% Other
0.2%
Biotechnology
15%
Business Products
Software 31% and Services 0.4%
Computers and
Peripherals 2%
Consumer Products
and Services 5%
Electronics/
Instrumentation 1%
Financial Services 1%
Healthcare Services 1%
Semiconductors Industrial/Energy 10%

3%
Retailing/
Distribution 2%
Networking and
Equipment 1% IT Services 7%
Medical Devices
and Equipment 9% Media and
Entertainment 7%
12 Thomson Reuters
2013 NVCA Yearbook
acquisition markets has not enabled most firms to range since 2002. In 2012, $26.7 billion was invested in
pay out sufficient distributions to their investors to 3,143 companies. This is less than 2011 totals and
begin raising another fund. For the vast majority of greater than 2010 totals. The number of first-time fund-
firms, raising additional capital right now is very ings likewise was less than 2011 and greater than 2010.
difficult. Further parsing the data shows an increasing portion of
the investment dollars going to California companies.
Software was the leading sector in 2012, receiving
Investments 31% of the total dollars. The second largest sector was
Measuring industry activity with the total dollars Biotechnology which fell to roughly half that amount
invested in a given year shows that the industry has at 15.4% of total investment The continued interest in
remained generally in the $20 billion to $30 billion Clean Technology investing brought the
Figure 8.0
2012 Investments
By State
Number of Pct of Investment Pct of

State Companies Total ($ Millions) Total
California 1,280 41% 14,128.8 53%
Massachusetts 326 10% 3,067.9 12%
New York 287 9% 1,856.7 7%
Washington 101 3% 931.5 3%
Texas 134 4% 930.5 3%
Illinois 76 2% 570.4 2%
Colorado 85 3% 564.2 2%
Pennsylvania 154 5% 517.8 2%
New Jersey 49 2% 429.3 2%
Virginia 62 2% 372.3 1%
All Others 589 19% 3,282.8 12%
Total 3,143 26,652.4
Figure 9.0
Venture-Backed IPOs
Offer
Amount Med Offer Mean Offer Post Offer Med Post Mean Post Median Age Mean Age
Year Num of IPOs ($Mil) Amt ($Mil) Amt ($Mil) Value ($Mil) Value ($Mil) Value ($Mil) @ IPO (yrs) @ IPO (yrs)
1985 48 763 13 16 1,991 32 47 3 4
1986 104 2,414 14 23 166,260 53 1889 4 4
1987 86 2,125 17 25 10,790 46 150 4 4
1988 43 769 15 18 20,523 51 555 3 4
1989 42 873 16 21 5,479 51 166 4 4
1990 47 1,108 20 24 5,886 60 178 4 4
1991 120 3,726 27 31 14,151 78 168 5 5
1992 150 5,431 24 36 15,759 68 147 5 5
1993 175 6,141 24 35 14,430 75 129 5 6
1994 140 4,004 24 29 9,854 67 91 5 5
1995 184 7,859 36 43 17,046 103 136 4 5
1996 256 12,666 35 49 40,360 111 191 3 4
1997 141 5,831 33 41 17,784 99 146 3 6
1998 79 4,221 43 53 9,649 149 214 3 3
1999 280 24,005 70 86 86,669 294 425 3 3
2000 238 27,443 83 115 63,610 336 464 3 4
2001 37 4,130 80 112 15,545 304 576 4 4
2002 24 2,333 89 97 8,322 266 347 3 5
2003 26 2,024 71 78 7,412 252 285 5 6
2004 82 10,032 70 122 50,268 254 613 6 6
2005 59 5,113 68 87 39,702 202 673 5 5
2006 68 7,127 85 105 71,467 293 1067 5 6
2007 92 12,365 97 134 68,282 361 742 6 6
2008 7 765 83 109 3,645 278 521 7 7
2009 13 1,980 123 152 9,192 548 707 6 7
2010 68 7,609 93 112 111,386 431 1662 5 6
2011 51 10,690 106 210 94,987 606 1862 6 7
2012 49 21,451 89 438 122,264 371 2495 7 8
Thomson Reuters 13
Industrial/Energy sector to 10.5% of the total. Medical remains a record number of companies in portfolios
Devices rounded out the top four sectors at 9.4%. in the later stage of development that in most other
positions in the business cycle would have already
The life sciences share of the venture capital invest- gone public or otherwise been acquired.
ment dollars decreased in 2012 to its lowest level
since 2002. In 2012, 15.4% of the money went into With the rule of thumb that a healthy venture capital
Biotechnology, 9.4% into Medical Devices, and 1.2% industry invests in 1,000-1,300 new companies each
into Healthcare Services, totaling 26.0%. This is year, the 1,174 first fundings in 2012 is very much in
down from the 33.1% combined share in 2009. that range. Not surprisingly, 81% of those first round
investments were made at the seed- and early-stage
As has been the case for several years, attention has levels.
been focused on the two ends of the spectrum.
Looking at deal counts, 2012 actually saw the highest The year 2012 provided an interesting contrast in geo-
percentage of seed- and early-stage deals since at least graphic dispersion. While 53% of all the investment
1985 (51.8% of total deals). This certainly would dollars went to California-based portfolio companies,
challenge the suggestion that the industry’s attention a record for MoneyTree™, companies in 48 states and
is single-focused on later-stage companies. That said, DC received financing, also a MoneyTree™ record
the 22.4% of deals going to later-stage companies is high.
also toward the top end of the historical range. There
Figure 10.0
Venture-Backed M&A Exits
Number Number ($ Millions)
Year Total Known Price Average
1985 6 3 300.2 100.1
1986 8 1 63.4 9.1
1987 10 4 667.2 111.2
1988 17 9 920.7 115.1
1989 20 10 746.9 74.7
1990 19 7 120.3 10.0
1991 16 4 190.5 15.9
1992 69 43 2,119.1 81.5
1993 59 36 1,332.9 58.0
1994 82 56 3,207.1 123.4
1995 92 58 3,801.8 111.8
1996 107 76 8,230.8 265.5
1997 143 99 7,743.6 176.0
1998 189 113 8,002.0 105.3
1999 227 154 38,688.0 530.0
2000 379 245 79,996.4 597.0
2001 384 175 25,115.6 120.2
2002 363 165 11,913.2 60.2
2003 323 134 8,240.8 43.6
2004 402 199 28,846.1 142.1
2005 443 198 19,600.2 80.0
2006 485 207 24,288.5 87.4
2007 488 200 30,745.5 106.8
2008 416 134 16,236.9 57.6
2009 350 108 12,364.9 51.1
2010 521 149 17,700.3 47.6
2011 488 169 24,093.2 75.5
2012 449 121 21,516.2 65.6
14 Thomson Reuters
2013 NVCA Yearbook
Exits ing or seeking to go public were not able to do so.
Once successful portfolio companies mature, venture On the market valuation placed on these IPOs at the
funds generally exit their positions in those compa- offer price, 2012 was a very good year. The 49 IPOs
nies by taking them public through an initial public had a valuation of $122.3 billion. This is the highest
offering (IPO) or by selling them to presumably larg- amount since 1986. What is quite striking (Fig 5.03),
er organizations (acquisition, or trade sale). This then is the huge gap between median and mean (average)
lets the venture fund distribute the proceeds to valuation of almost seven times! This suggests a huge
investors, raise a new fund for future investment, and outlier effect created by the very large IPOs that suc-
invest in the next generation of companies. This chap- ceeded.
ter considers each type of exit separately.
In 2012, the acquisition market weakened. There was
IPOs in 2012 were a mixed bag at best. On the one a slight decrease in the number of acquisitions, or
hand, the number of venture-backed companies going trade sales, of venture-backed companies. We tracked
public actually fell from 2011 from 51 to 49. But the 449 acquisitions, of which we had disclosed deal
dollars raised in those initial public offerings more amounts for 121 of them. The sum of the disclosed
than doubled from $10.7 billion to $21.5 billion. But values was also down at $21.5 billion. Just over one-
looking behind the numbers, we see that Facebook fifth of them were acquired at 10 times or greater than
itself raised $16.0 billion of that $21.5 billion, with a the cumulative venture capital investment in those
few other high-profile IPOs looming large in the companies. We tracked four acquisitions at more than
remainder. This meant that many companies attempt- $1 billion.
Thomson Reuters 15
16 Thomson Reuters
Industry Resources
The activity level of the U.S. venture capital industry is roughly half of what it was at the 2000-era peak. For
example, in 2000, 1053 firms each invested $5 million or more during the year. In 2012, the count was less than
half that at 522.
Venture capital under management in the United States by the end of 2012 decreased to $199.2 billion as cal-
culated using the methodology described below. However, looking behind the numbers, we know that the indus-
try continues to contract from the circa 2000 bubble high of $261.2 billion
The slight downtick in firms and capital managed in 2012 perhaps understates a consolidating trend. The aver-
age venture capital firm shrunk to 7.0 principals per firm from 7.4 in 2011. The corresponding drop in head-
count to under 6,000 principals is almost one-third lower than 2007 levels. This meant that there was an
increase in the average amount of capital managed by each principal. It is possible going forward, that the
number of principals per firm will increase as the number of firms decreases. This is because the bulk of the
money being raised today is being raised by larger, specialty, and boutique firms. For our purposes here, we
define a principal to be someone who goes to portfolio company board meetings. That is, deal partners would
be included and firm CFOs would not be included.
Geographic location of the largest venture firms is quite concentrated. California domiciled firms manage
47.1% of the industry’s capital although these firms 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 five states (California, Massachusetts, New York,
Connecticut, and Illinois) hold 81.4% of total venture capital in this country.
METHODOLOGY added a column to the table to report the number of

Historically we have calculated industry size using a independent and corporate venture groups actually
“rolling eight years of fundraising” proxy for capital investing $5 million or more in a given year. These
managed, number of funds, number of firms, etc. The 522 firms are less than half the level of 2000. We
number of firms in existence will vary on a rolling expect this statistic to fall further going forward.
eight-year basis as firms raise new funds or do not
raise funds for more than eight years. Currently, we For this publication, we are primarily counting the
know the industry is consolidating, but the eight- year number of firms with limited partnerships and are
model now includes fund vintage years 2005-2012. excluding other types of investment vehicles. From
However, through 2012, the rolling eight year that description, it may appear that the statistics for
methodology belies this contraction because the very total industry resources may be underestimated.
slow fundraising years of 2002-2004 were rolling out However, this must be balanced with the fact that cap-
of the calculation. ital under management by captive and evergreen
funds is difficult to compare equitably to typical lim-
Under this methodology, we estimate that there are ited partnerships with fixed lives. For this analysis
currently 841 firms with limited partnerships “in only, the firms counted for capital under management
existence.” To clarify, this is actually stating that there include firms with fixed-life partnerships and venture
are 841 firms that have raised a venture capital fund capital funds they raised. If a firm raised both buyout
in the last eight years. In reality, fewer firms are actu- and venture capital funds, only the venture funds
ally making new investments in 2012. would be counted in the calculation of venture capital
under management.
To better report the actual number of active firms, we
Thomson Reuters 17
Venture capital under management can be a complex have completed their life cycle. Typically, venture
statistic to estimate. Indeed, capital under manage- capital firms have a stated 10-year fixed life span,
ment reported by firms can differ from firm to firm as except for life science funds, which are often estab-
there’s not one singular definition. For example, some lished as 12-year funds. Figure 1.08 shows the reality
firms include only cumulative committed capital, oth- of fund life. Thomson Reuters calculates capital under
ers may include committed capital plus capital gains, management as the cumulative amount committed to
and still other firms define it as committed capital funds on a rolling eight-year basis. Current capital
after subtracting liquidations. To complicate matters, under management is calculated by taking the capital
it is difficult to compare these totals to European pri- under management calculation from the previous
vate equity firms, which include capital gains as part year, adding in the current year’s funds’ commitments,
of their capital under management measurements. and subtracting the capital raised eight years prior.
For purposes of the analysis in this publication, we For this analysis, Thomson Reuters classifies venture
have tried to clarify the industry definition of capital capital firms using four distinct types: private inde-
under management as the cumulative total of commit- pendent firms, financial institutions, corporations,
ted capital less liquidated funds or those funds that and other entities. ‘Private independent’ firms are
Figure 1.01
Capital Under Management
1985 to 2012
350
300
250
($ Billions)
200
150
100
50
0
7
1997
7
0
8
0
8
1
0
1
6
9
6
9
4
5
5
2
4
2
3
1992
1993
200
201
199
200
198
200
200
198
198
200
200
201
199
198
200
199
200
198
199
199
200
200
201
199
199
Year
18 Thomson Reuters
2013 NVCA Yearbook
made up of independent private and public firms group. The capital under management statistics
including both institutionally and non-institutionally reported in this section consist primarily of venture
funded firms and family groups. ‘Financial institu- capital firms investing through limited partnerships
tions’ refers to firms that are affiliates and/or sub- with fixed commitment levels and fixed lives and do
sidiaries of investment banks and non-investment not include non-vintage “evergreen funds” or true
bank financial entities, including commercial banks captive corporate industrial investment groups with-
and insurance companies. The ‘corporations’ classifi- out fixed commitment levels. The term ‘evergreen
cation includes venture capital subsidiaries and affili- funds’ refers to funds that have a continuous infusion
ates of industrial corporations. In 2013, we will mod- of capital from a parent organization, as opposed to
ify the methodology to reflect virtually all direct cor- the fixed life and commitment level of a closed-end
porate investment because many of the corporate ven- venture capital fund.
ture investors do not operate out of a separate fund or
Figure 1.02
Total Capital Under Management
By Firm Type 1985 to 2012 ($ Millions)
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
PPrivate Independent 11,636 14,574 17,299 18,607 22,112 22,632 21,805 22,557 25,199 28,528 33,417 40,235 51,877 76,398 120,221 187,475 221,105 221,634 225,208 233,976 242,466 255,714 238,766 194,698 171,713 175,980 183,482 180,936
Financial Institutions 3,368 3,508 3,442 3,178 2,714 2,802 2,392 2,220 2,484 2,924 3,758 5,123 7,209 10,382 15,466 23,454 24,975 24,453 23,558 22,277 21,634 18,991 14,384 6,263 4,865 5,266 9,541 9,670
Corporations 1,739 1,709 2,062 2,148 2,095 2,142 2,086 2,211 1,526 1,573 1,345 2,032 2,348 3,245
3 6,797 11,604 12,787 12,766 12,717 12,245 12,044 11,964 8,828 4,171 2,979 3,458 4,483 4,497
Other 857 909 897 867 779 725 618 313 191 275 380 409 665 875 1,116 1,467 2,134 2,347 2,317 2,302 2,055 2,031 1,822 1,469 843 3,997 3,995 4,098
Total 17,600 20,700 23,700 24,800 27,700 28,300 26,900 27,300 29,400 33,300 38,900 47,800 62,100 90,900 143,600 224,000 261,000 261,200 263,800 270,800 278,200 288,700 263,800 206,600 180,400 188,700 201,500 199,200
Figure 1.03
Distribution of Firms
By Capital Managed 2012
155
160 139
140 125
111 112
120
91
100
80 60
60 47
40
20
0
+
10
0
5
00
-2
-5
50
-10
25
00
0-
10
10
25
0-
0-
10
50
0-
10
25
50
Capital Under Management ($ Millions)

This chart shows capital committed to U.S. venture firms in active funds. While much of the capital is managed
by larger firms, of the 841 firms at the end of 2012, roughly 60% of them (504) managed $100 million or less. By
comparison, just 47 firms managed active funds totaling more than $1 billion.
Thomson Reuters 19
Figure 1.04
Fund and Firm Analysis
Fund Total Total Total Firms That Raised Capital Avg Avg Firms
Vintage Cumulative Cumulative Cumulative Existing Funds in the Last Managed Fund Size Firm Size Actively
Year Funds Firms Capital ($B) Funds 8 Vintage Years ($B) ($M) ($M) Investing
1985 631 323 20 532 294 17.6 33.1 59.9 92
1986 707 353 23.4 590 324 20.7 35.1 63.9 113
1987 810 388 27.4 670 353 23.7 35.4 67.1 112
1988 887 406 30.8 700 365 24.8 35.4 67.9 118
1989 979 435 35.8 727 380 27.7 38.1 72.9 115
1990 1,037 451 38.3 716 383 28.3 39.5 73.9 100
1991 1,075 458 40.5 639 360 26.9 42.1 74.7 80
1992 1,147 478 44.1 601 352 27.3 45.4 77.6 104
1993 1,244 509 49.4 613 370 29.4 48.0 79.5 93
1994 1,342 542 56.7 635 385 33.3 52.4 86.5 110
1995 1,497 607 66.2 687 424 38.9 56.6 91.7 185
1996 1,647 668 78.6 760 469 47.8 62.9 101.9 249
1997 1,859 760 97.9 880 541 62.1 70.6 114.8 342
1998 2,096 839 129.2 1,059 613 90.9 85.8 148.3 408
1999 2,433 966 184.1 1,358 733 143.6 105.7 195.9 713
2000 2,849 1,109 268.2 1,702 864 224 131.6 259.3 1053
2001 3,092 1,191 310.4 1,848 920 261 141.2 283.7 759
2002 3,174 1,208 318 1,832 918 261.2 142.6 284.5 534
2003 3,282 1,260 330 1,785 948 263.8 147.8 278.3 505
2004 3,447 1,328 349.4 1,800 984 270.8 150.4 275.2 575
2005 3,622 1,398 376.2 1,763 1009 278.2 157.8 275.7 558
2006 3,805 1,474 417.9 1,709 1019 288.7 168.9 283.3 570
2007 4,019 1,558 447.9 1,586 1010 263.8 166.3 261.2 627
2008 4,205 1,621 474.8 1,356 879 206.6 152.4 235 603
2009 4,313 1,664 490.7 1,221 818 180.4 147.7 220.5 462
2010 4,439 1,725 506.7 1,265 844 188.7 149.2 223.6 509
2011 4,599 1,787 531.5 1,317 868 201.5 153.0 232.1 545
2012 4,716 1,828 548.6 1,269 841 199.2 157.0 236.9 522
The correct interpretation of this chart is that since the beginning of the industry to the end of 2012, 1,828 firms had been founded and 4,716 funds had
been raised. Those funds totaled $548.6 billion. At the end of 2012, 841 firms as calculated using our eight-year methodology managed 1,269 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 firms at the end of 2012 was $199.2 billion. However, only 522 independent and corporate venture groups invested at least $5 million in
MoneyTree™ deals in 2012.
Figure 1.05 Figure 1.06

Principals Information Top 5 States
By Capital Under Management 2012
No. Estimated Avg Mgt State ($ Millions)
Principals Industry Per Principal CA 93,814.8
Year Per Firm Principals ($M) MA 34,482.3
2007 8.7 8,665 30.0 NY 21,378.0
2008 8.5 7,293 28.3 CT 8,051.2
2009 8.6 6,760 26.4 IL 4,369.0
2010 8.0 6,328 25.7 Total* 162,095.4
2011 7.4 6,231 28.6 *Total includes above 5 states only only
*Total includes above 5 states
2012 7.0 5,887 33.8
The correct interpretation of this chart is that at year end 2012, there were 5,887
principals (people who go to board meetings) in the industry. A principal on aver-
age manages $33.8 million and the average firm is made up of 7.0 principals, down
from 7.4 principals a year earlier.
20 Thomson Reuters
2013 NVCA Yearbook
Figure 1.07
Capital Under Management By State 1985 to 2012 ($ Millions)
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
CA 4,875 5,836 6,493 6,727 7,987 7,620 7,732 7,728 8,562 9,315 11,524 14,797 19,349 26,799 83,652 102,032 102,065 105,008 110,920 116,533 125,205 113,611 97,099 85,072 88,085 93,952 93,815
MA 2,331 2,646 3,533 3,886 4,292 4,414 4,070 4,944 5,136 5,645 6,881 7,339 10,436 15,737 38,137 47,762 49,004 48,678 49,187 50,675 55,598 52,312 38,586 32,397 32,001 31,836 34,482
NY 3,382 4,421 4,369 4,158 5,589 5,810 5,460 5,314 5,911 6,977 8,268 9,952 10,286 19,646 38,221 39,225 37,658 37,086 36,655 36,182 29,295 25,621 14,104 13,156 18,116 22,380 21,378
CT 1,285 1,432 1,917 1,979 1,821 1,984 1,840 1,937 2,268 2,430 2,282 2,397 3,677 4,684 8,913 11,878 11,710 11,682 13,333 13,525 14,879 13,251 12,165 8,498 9,263 10,076 8,051
IL 470 490 720 848 804 818 783 886 1,148 1,220 1,361 1,312 1,989 2,245 4,393 4,805 5,258 5,616 5,690 5,168 5,289 4,235 3,590 3,278 3,060 4,564 4,369
PA 444 518 548 562 731 772 774 770 570 739 822 1,324 1,743 2,100 3 6,233 6,338 6,231 6,523 6,100 6,506 7,033 7,063 4,564 4,399 4,408 4,123 4,183
DC 3 4 4 3 4 4 4 1 20 20 123 1,670 2,325 2,450 3,847 4,122 4,686 4,584 3,373 3,582 4,640 5,046 4,835 4,631 4,043 4,510 4,165
TX 454 488 722 720 792 835 773 805 936 1,143 1,145 1,225 1,681 2,994 6,871 7,994 7,922 7,799 8,259 8,448 8,203 6,550 5,431 4,203 4,061 4,164 3,838
NJ 610 707 746 734 730 950 880 546 512 695 958 1,480 1,557 2,171 3,628 4,311 4,226 4,440 4,083 4,073 5,159 5,021 4,137 3,916 3,959 3,554 3,355
MD 93 97 123 116 158 163 98 115 374 784 914 1,514 2,004 2,642 3 5,112 5,378 5,159 5,043 4,811 4,762 4,743 4,432 2,936 3,005 2,912 2,891 3,010
WA 313 406 384 422 395 383 198 241 227 178 299 460 677 1,078 2,799 3,684 3,687 3,566 4,630 4,591 4,597 5,173 4,627 3,720 3,684 3,693 2,749
VA 72 78 78 84 104 91 56 42 35 32 48 73 251 506 2,520 2,636 2,649 2,819 2,868 3,338 3,367 3,013 1,802 2,225 2,267 2,073 1,999
MN 198 294 338 672 743 882 810 764 842 896 877 511 616 713 2,235 2,187 2,363 2,357 2,361 2,441 2,593 2,472 1,640 1,657 1,317 1,763 1,862
N NC 34 54 87 89 124 113 109 110 108 146 128 298 618 804 1,007
1,365 1,361,446 1,577 1,776 1,618 1,447 1,657 1,542 1,190 1,216 1,696 1,614 1,633
CO 361 428 396 513 613 572 554 528 617 566 475 549 863 1,162 4,775 5,288 5,432 5,412 5,229 4,882 4,663 3,010 1,604 974 1,137 1,144 1,399
MO 557 581 614 591 599 655 653 642 107 137 119 124 147 111 307 449 417 407 504 1,232 1,293 1,384 1,318 1,182 1,187 1,188 1,315
UT 9 19 19 15 15 16 15 10 10 25 31 31 94 96 268 475 448 559 589 546 651 1,251 1,328 1,136 1,199 1,314 1,296
MI 111 119 125 122 123 38 14 14 13 10 41 41 66 76 587 591 589 631 859 912 946 685 919 976 1,051 1,244 1,022
FL 124 131 172 192 194 132 110 97 151 223 321 303 378 688 1,782 1,749 1,682 1,591 1,577 1,802 1,525 1,283 558 801 864 819 818
TN 102 127 191 183 215 259 276 270 200 292 306 453 463 743 1,235 1,280 1,161 1,150 1,043 1,089 840 669 576 565 775 802 763
GA 88 94 175 257 261 275 262 262 434 432 434 359 762 1,074 2,308 2,158 2,151 2,075 2,109 1,835 1,697 1,686 558 530 533 646 605
DE 39 40 40 38 47 41 41 14 41 51 100 121 114 116 113 80 69 28 15 15 15 251 256 394 396 445 544
O OH 852 889 969 831 254 257 273 303 427 470 447 375 689 764 1,847 1,872 1,873 1,853 1,986 1,805 1,721 1,329 714 565 521 570 439
AL 125 131 131 127 134 136 136 137 6 6 6 6 5 24 107 107 107 155 173 225 224 216 357 361 362 387 369
IN 45 55 56 77 96 88 80 96 99 109 111 192 176 191 662 662 650 683 593 595 608 617 136 342 343 308 335
AZ 40 43 43 73 74 75 75 34 44 43 44 10 9 38 101 104 145 180 180 199 171 173 130 118 263 260 309
LA 7 7 7 7 7 5 2 11 22 31 49 89 275 366 476 651 648 631 663 502 430 353 336 196 263 279 214
KY 15 16 16 16 0 0 0 0 0 7 21 21 21 21 21 21 14 14 14 18 216 218 223 225 226 212 212
W WI 181 99 98 95 104 104 78 78 81 163 168 195 180 204 1 245 245 152 152 133 105 205 213 141 143 170 194 199
NM 71 100 135 132 168 255 243 230 205 179 154 151 120 12 12 12 12 33 35 69 74 77 79 80 114 84 82
ID 0 0 0 0 0 0 0 0 0 0 0 0 0 0 014 1 14 14 14 14 14 84 85 72 73 73 73 73
ME 1 1 20 25 26 26 26 28 29 98 89 86 88 89 202 290 218 219 214 215 276 160 164 73 73 69 69
OK 1 29 29 28 37 38 37 37 38 9 10 32 23 67 140 139 139 139 117 117 111 121 47 47 47 47 48
SD 0 0 0 0 0 0 0 0 0 0 0 10 10 85 178 177 177 177 175 175 103 113 32 32 48 48 40
HI 2 2 2 2 2 2 2 0 0 0 2 2 2 2 1 11 11 11 9 16 16 16 7 14 14 43 43 36
IA 49 51 104 101 80 82 61 62 54 55 5 5 16 17 16 60 60 55 65 53 60 67 69 39 39 39 29
OR 168 176 203 239 242 246 228 116 74 74 77 30 30 40 100 100 112 83 85 85 76 78 34 40 29 29 27
VT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 016 1 43 43 43 43 43 43 57 41 14 19 19 19
NH 24 25 25 49 50 51 50 50 27 27 47 19 66 67 65 65 84 65 65 19 30 30 31 31 11 11 16
ND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 00 00 00 00 00 00 00 013 1 13 14 14 14
KS 0 0 0 0 0 13 13 13 14 14 37 37 56 43 42 42 42 19 19 0 0 0 0 0 8 8 8
S SC 1 1 1 1 15 15 15 15 15 15 29 52 37 37 36 37 71 58 35 41 41 41 42 41 5 5 5
N NE 0 0 0 1 1 1 1 1 11 11 105 136 138 141 175 164 164 71 38 38 38 38 0 0 2 2 3
M MS 0 0 0 0 0 0 0 0 0 0 11 11 11 11 11 39 39 28 28 28 29 30 30 1 1 1 1
P PR 0 0 0 0 0 9 9 9 9 9 9 9 49 40 39 68 68 68 68 29 29 30 31 1 1 1 1
W WY 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1170 1 117 117 117 117 118 118 119 0 0 0 0 0
R RI 15 16 16 36 36 37 36 36 22 22 23 0 2 2 22 226 226 35 35 33 33 33 34 10 10 0 0
N NV 0 0 0 0 0 0 0 0 0 0 0 0 0 0 223 23 32 32 33 33 33 9 10 10 0 0 0
W WV 0 0 0 0 0 0 0 0 0 0 0 0 0 0 021 221 21 21 21 21 21 21 0 0 0 0 0
A AR 2 2 2 2 2 2 2 0 0 0 0 0 0 0 1 19 19 19 19 19 19 19 0 0 0 0 0 0
M MT 0 1 1 1 1 1 1 1 1 0 0 0 0 0 00 00 00 00 00 00 00 00 00 00 00 00 00 0
U UN 46 48 48 46 31 31 21 0 0 0 0 0 0 0 00 00 00 00 00 00 00 00 00 00 00 00 00 0
A AK 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 00 00 00 00 00 00 00 00 00 00 00 00 0
T Total 17,600 20,700 23,700 24,800 27,700 28,300 26,900 27,300 29,400 33,300 38,900 47,800 62,100 90,900 224,00 261,300 261,200 263,800 270,800 278,200 288,700 263,800 206,600 180,400 188,700 201,500 199,200
Thomson Reuters 21
Figure 1.08
Life of IT Funds in Years
Life of IT Funds % of
In Years Funds
<= 10 7%
11-12 20%
13-14 27%
15-16 22%
17-18 14%
>=19 10%
Source: Adams Street Partners, based on 2010 analysis of dissolved funds.
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 remain in the portfolios that typically do not have
huge upside potential. 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.
22 Thomson Reuters
Capital Commitments
New commitments to venture capital funds in the United States increased for the second year in a row, which
follows four years of declines. In 2012, commitments totaling $20.1 billion were made to 183 funds. This is
roughly two-thirds of the annual levels seen in 2005-2007 and approximately one-fifth of the annual amount
raised at the bubble peak.
When you look behind the 2012 capital commitments at the specific funds being raised, the 10 largest funds
represent 48% of the capital raised, with 173 funds raising the other 52%.
This is the sixth consecutive year in which more money was invested by the industry than raised in new com-
mitments. That has been the case in 11 of the past 13 years. While this is not a true apples-to-apples compar-
ison, it does explain the industry’s strong interest in raising additional funds in 2013 and beyond. The narrow
success of recent IPO and acquisition markets has not enabled most firms to pay out sufficient distributions to
their investors to begin raising another fund. For the vast majority of firms, raising additional capital right now
is very difficult.
For the seventh year in a row, the top fundraising states were California and Massachusetts. This year,
Connecticut replaces New York in the third position. California, with its venture firms raising $13.7 billion,
holds the top spot for the tenth year in a row. Firms domiciled in the top five fundraising states in 2012 gath-
ered 88% of the dollars, compared with 91% in 2011, 88% in 2010 and 82% in 2009.
Please note that the state of fund domicile matters less than has been true historically. Much of the money is
managed by large, national funds that tend to be domiciled in any of several states with a broad geographic
investing footprint. Readers should not interpret capital available to entrepreneurs in a given state as being
limited to the capital raised in that state.
Venture capital fundraising typically makes up 20-25% of private equity fundraising. But in 2012, it represent-
ed 16% of total, down from 22% in 2011.
Methodology figure 1.04). The data in this chapter is by calendar

year and incrementally measures how much in new
As defined by Thomson Reuters, capital commitments, commitments funds raised during the calendar year.
also known as fundraising, are firm capital commit-
ments to private equity/venture capital limited partner- Consider, for example, a venture capital firm that
ships by outside investors. For purposes of these statis- announces a $200 million fund in late 2010, raises
tics, the terms “capital commitments,” “fundraising,” $75 million in 2011, and subsequently raises the
and “fund closes” are used interchangeably. There are remaining $125 million in 2012. In this chapter, noth-
three data sources for tracking capital commitments: ing would be reflected in 2010, $75 million would be
(1) SEC filings that are regularly monitored by our counted in 2011, and $125 million would be counted
research staff, (2) surveys of the industry routinely con- in 2012. Assuming it started investing and made its
ducted by Thomson Reuters, and (3) verified industry first capital call in 2012, the entire fund would then be
press and press releases from venture firms. considered to be a 2012 vintage year fund.
Capital commitments are stated on either (1) a calen- Note that fund commitments presented in this publica-
dar-year basis when committed (for example, through- tion do not include those corporate captive venture cap-
out this chapter) or (2) a vintage-year basis which is ital funds that are funded by a corporate parent, which
designated once the fund starts investing (for example, do not typically raise capital from outside investors.
Thomson Reuters 23
Figure 2.01
Capital Commitments
To U.S. Venture Funds ($ Billions)
1985 to 2012
120
100
80
($ Billions)
60
40
20
0
5
9
0
1
7
6
8
9
0
0
1
2
7
7
8
8
6
9
4
5
2
4
2
3
199
201
2 00
199
200
198
199
199
198
198
199
199
199
199
199
200
2 01
200
200
2 00
200
201
199
198
200
200
198
2 00
Year
Figure 2.02
Capital Commitments To Private Equity Funds 1985-2012
Venture Capital Buyouts and Mezzanine Capital Total Private Equity
No. No.
Year Sum ($Mil) % of Total PE Funds Sum ($Mil) No. Funds Sum ($Mil) Funds
1985 3,727.9 56% 116 2,971.8 21 6,699.7 137
1986 3,584.5 42% 101 5,043.7 32 8,628.2 133
1987 4,379.1 21% 116 16,234.6 47 20,613.6 163
1988 4,209.7 28% 104 10,946.4 54 15,156.1 158
1989 4,918.8 29% 106 12,068.5 78 16,987.3 184
1990 3,222.7 27% 86 8,831.5 64 12,054.3 150
1991 1,900.3 31% 40 4,242.1 27 6,142.4 67
1992 5,223.1 33% 80 10,752.5 58 15,975.6 138
1993 4,489.2 21% 93 16,961.7 81 21,451.0 174
1994 7,636.7 27% 136 20,457.0 100 28,093.7 236
1995 9,387.3 26% 161 27,040.7 108 36,428.0 269
1996 11,550.0 26% 168 32,981.4 104 44,531.3 272
1997 17,741.9 29% 242 42,803.0 136 60,544.9 378
1998 30,641.7 33% 290 62,023.7 173 92,665.4 463
1999 53,597.8 50% 430 53,720.7 166 107,318.5 596
2000 101,417.9 56% 634 80,614.8 171 182,032.7 805
2001 38,923.4 43% 324 52,523.0 137 91,446.4 461
2002 11,867.3 25% 202 35,076.8 124 46,944.0 326
2003 10,586.7 23% 161 35,913.4 121 46,500.1 282
2004 18,137.1 23% 212 59,878.5 158 78,015.6 370
2005 30,627.3 22% 234 108,249.8 205 138,877.1 439
2006 31,371.7 17% 236 152,566.2 216 183,937.9 452
2007 29,378.1 11% 235 243,264.2 264 272,642.3 499
2008 25,577.2 12% 215 180,923.9 231 206,501.1 446
2009 16,194.4 25% 162 49,871.5 148 66,065.9 310
2010 13,519.8 21% 175 51,674.8 173 65,194.6 348
2011 19,296.2 22% 188 70,103.5 207 89,399.6 395
2012 20,065.9 16% 183 106,249.9 217 126,315.7 400
24 Thomson Reuters
2013 NVCA Yearbook
Figure 2.03
Venture Capital Fund Commitments
1985 to 2012 ($ Millions)
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
CCA 1,250 969 1,159 936 1,519 831 549 1,311 1,333 1,764 3,107 3,724 5,463 8,456 21,891 43,485 13,452 154 4,830 8,645 12,869 13,621 12,016 14,053 8,635 6,337 9,790 13,665
MA 534 356 973 582 339 675 180 1,051 368 1,158 1,955 1,871 2,602 5,176 7,659 16,692 9,783 1,397 1,597 1,485 9,151 4,366 5,122 2,486 3,574 2,779 2,503 1,410
CT 282 156 420 352 66 290 150 300 473 388 260 425 1,324 1,068 2,843 2,313 4
4,164 24 165 1,926 1,143 3,136 904 766 158 1,035 149 1,388
NY 202 1,460 547 279 2,260 490 474 494 940 1,860 2,364 1,516 3,609 9,346 8,945 15,400 2,986 7,704 1,233 2,149 1,736 2,512 4,310 1,826 1,652 1,259 4,096 758
NC 7 7 31 23 38 1 0 0 0 63 10 184 349 174 180 613 105 55 237 17 108 401 185 103 5 456 130 472
WA 25 126 37 60 0 0 5 48 40 37 129 239 180 409 640 1,175 888 43 1 955 281 563 1,376 492 5 0 0 399
CO 32 71 32 70 80 0 0 0 114 0 19 216 253 433 1,942 2,414 513 118 94 84 69 132 358 221 3 262 6 280
TTN 20 23 73 0 34 0 0 40 0 116 84 149 109 266 267 262 82 22 101 16 84 62 100 134 89 42 161 278
FL 10 0 36 11 29 0 35 0 59 105 106 0 78 250 326 955 26 8 56 1 313 10 109 25 32 75 2 268
PA 54 73 55 12 118 45 167 30 110 182 114 264 784 177 1,241 2,751 537 54 388 451 688 794 746 963 233 205 126 183
UT 0 11 1 0 0 0 0 0 0 27 0 0 17 50 62 126 232 0 34 40 24 170 213 569 33 16 160 159
MO 644 0 33 0 0 53 0 0 64 0 11 6 45 25 80 65 286 0 0 80 829 40 210 54 0 72 0 155
MN 14 110 51 418 20 162 16 946 66 164 7 36 208 217 107 1,827 17 276 26 50 295 473 275 325 22 0 0 150
IL 51 47 325 158 26 57 94 247 278 183 230 295 575 466 1,304 964 1,10
1,103 478 657 432 80 422 545 258 216 238 215 120
NJ 254 61 120 0 125 243 75 110 177 401 213 606 118 1,002 570 1,041 6
652 392 561 197 204 1,812 235 53 504 112 100 63
AZ 0 0 0 37 0 0 0 0 10 0 0 0 0 0 29 60 21 43 41 0 19 0 0 20 0 0 222 54
VA 0 4 10 13 15 2 0 17 5 0 7 20 165 226 884 2,212 1
119 37 196 72 419 555 582 105 14 121 36 45
WI 0 0 0 0 0 0 0 0 0 40 0 31 30 0 17 66 14 0 0 11 0 78 102 15 9 27 0 40
IN 0 10 0 27 16 5 0 49 0 20 0 116 0 13 20 103 0 10 36 17 6 24 1 29 1 28 0 39
OH 3 0 87 75 0 30 0 67 4 86 10 0 358 58 659 662 330 102 5 210 558 152 81 83 4 30 79 32
TX 37 33 231 41 161 143 50 381 137 283 179 326 394 1,330 1,803 3,615 2,232 106 76 589 570 314 316 1,038 78 83 210 31
MI 5 0 7 33 0 0 0 0 3 14 0 26 11 0 321 241 8 0 65 63 122 23 49 256 84 177 192 20
MD 4 7 24 0 49 14 50 0 225 479 67 439 145 768 840 1,990 340 381 105 162 433 472 783 369 484 68 544 19
AL 150 0 0 0 0 0 0 0 0 0 0 0 5 30 0 137 16 11 49 19 70 19 0 118 101 2 58 19
GA 0 0 15 65 0 14 0 0 56 0 74 34 41 181 30 918 19 0 0 55 104 103 203 19 31 31 26 13
NH 49 0 0 40 0 0 15 0 0 0 20 0 50 0 0 0 0 111 9 0 0 5 7 0 0 0 0 5
NNE 0 0 0 0 0 0 0 0 0 0 111 36 0 0 0 41 0 0 0 0 0 0 0 0 0 2 0 1
DDE 39 0 0 5 0 0 0 0 0 0 130 820 668 392 360 778 622 315 0 299 393 896 315 1,123 204 0 475 0
ND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 131 0 0 0 0
OOK 0 32 0 0 10 0 0 0 0 0 0 24 0 45 0 110 0 0 0 0 121 38 11 0 0 0 0 0
AAR 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20 0 0 0 0 0 0 0 0 0 0 0 0
DDC 0 0 0 0 0 0 0 0 0 25 31 65 0 0 28 0 0 22 0 10 0 0 0 0 0 0 0 0
HHI 0 0 0 0 0 0 0 0 0 0 3 0 0 0 10 0 0 3 0 8 0 0 0 6 0 0 0 0
IID 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 15 27 0 0 0 0 0 75 0 0 0 0 0
IIA 11 0 60 0 0 0 0 56 0 0 5 0 11 2 5 21 26 0 0 10 0 43 0 0 15 0 0 0
KKS 0 0 0 0 0 0 0 0 0 0 0 0 20 0 0 0 0 0 0 0 0 0 101 20 0 0 8 0
KKY 0 0 0 0 0 0 0 0 14 7 15 0 42 0 0 0 1
135 8 2 0 5 65 98 12 0 0 0 0
LLA 0 0 0 0 0 0 0 11 14 169 18 24 88 51 373 70 27 8 0 73 4 12 0 0 0 0 0 0
MME 0 0 22 948 0 0 0 2 0 59 0 22 0 0 127 0 76 16 3 0 0 46 19 0 0 0 6 0
MMS 0 0 0 0 0 0 0 0 0 0 12 0 0 0 0 30 0 0 0 0 0 1 0 0 0 0 0 0
NNV 0 0 0 0 0 0 0 0 0 0 50 25 0 0 25 0 0 10 0 0 0 0 0 0 0 0 0 0
NNM 36 28 0 2 0 155 40 0 0 6 2 0 0 0 0 0 0 0 181 4 34 5 7 0 0 35 1 0
OOR 0 0 30 0 0 0 0 0 0 0 32 0 0 10 0 65 0 14 0 2 0 0 2 5 6 12 2 0
PPR 0 0 0 0 0 10 0 0 0 0 0 0 0 0 0 0 313 0 0 0 0 0 1 0 0 0 0 0
RRI 17 0 0 25 0 0 0 0 0 0 0 0 0 0 0 0 252 0 0 0 0 0 0 0 0 0 0 0
SSC 0 0 0 0 13 5 0 0 0 0 14 0 0 0 0 0 0 353 2 0 6 0 0 0 0 0 0 0
SSD 0 0 0 0 0 0 0 0 0 0 0 11 0 22 14 131 1 0 0 5 0 3 0 14 0 16 0 0
VVT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 20 25 0 0 0 0 0 11 3 0 0 0 0
WWV 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 6 4 131 0 0 0 0 0 0 0 0 0 0
WWY 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 26 0 0 0 0 0 0 0 0 0 0 0 0
TTotal 3,728 3,584 4,379 4,210 4,919 3,223 1,900 5,161 4,489 7,637 9,387 11,550 17,742 30,642 53,598 101,418 38,923 11,867 10,587 18,137 30,627 31,372 29,378 25,577 16,194 13,520 19,296 20,066
Thomson Reuters 25
Figure 2.04
Top 5 States
By Venture Capital Committed 2012
No. of Committed
State Funds ($Mil)
California 64 13,665.3
Massachusetts 17 1,409.7
Connecticut 4 1,388.0
New York 21 757.7
North Carolina 5 472.0
Sub-Total 111 17,692.7
Remaining States 72 2,373.1
Total 183 20,065.9
Figure 2.05
Private Equity
Annual Commitment ($ Billions)
1985 to 2012
280
260
240
220 Venture Capital Buyout and Mezzannine Capital
200
180
($ Billions)
160
140
120
100
80
60
40
20
-
0
1
8
2
7
7
7
0
8
0
8
1
6
9
9
4
5
5
2
4
2
3
199
200
201
200
198
199
199
199
199
199
199
200
200
198
198
200
200
201
199
198
200
200
199
198
199
200
200
201
Year
26 Thomson Reuters
Investments
Measuring industry activity with 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 2012, $26.7 billion was
invested in 3,143 companies. This is less than 2011 totals and greater than 2010 totals. The number
of first-time fundings likewise was less than 2011 and greater than 2010. Further parsing the data
shows an increasing portion of the investment dollars going to California companies.
Sectors As has been the case for several years, attention has
been focused on the two ends of the spectrum.
Software was the leading sector in 2012, receiving 31% Looking at deal counts, 2012 actually saw the highest
of the total dollars. The second largest sector was percentage of seed- and early-stage deals since at least
Biotechnology which fell to roughly half that amount at 1985 (51.8% of total deals). This certainly would
15.4% of total investment The continued interest in challenge the suggestion that the industry’s attention
Clean Technology investing brought the Industrial/- is single-focused on later-stage companies. That said,
Energy sector to 10.5% of the total. Medical Devices the 22.4% of deals going to later-stage companies is
rounded out the top four sectors at 9.4%. also toward the top end of the historical range. There
remains a record number of companies in portfolios
The life sciences share of the venture capital invest- in the later stage of development that in most other
ment dollars decreased in 2012 to its lowest level positions in the business cycle would have already
since 2002. In 2012, 15.4% of the money went into gone public or otherwise been acquired.
Biotechnology, 9.4% into Medical Devices, and 1.2%
into Healthcare Services, totaling 26.0%. This is With the rule of thumb that a healthy venture capital
down from the 33.1% combined share in 2009. industry invests in 1,000-1,300 new companies each
year, the 1,174 first fundings in 2012 is very much in
This recent downward life sciences trend is very visi- that range. Not surprisingly, 81% of those first round
ble when just looking at first fundings. In 2012, only investments were made at the seed and early stage.
149 life science (the three sectors combined) compa-
nies received first funding. This is 12.7% of the total.
As recently as 2006, the 294 first fundings of life sci-
Geographical Spread Across the United
ence companies made up 23.0% of total first fundings. States
The year 2012 provided an interesting contrast in geo-
Among first fundings, Software led the way with 441 graphic dispersion. While 53% of all the investment
companies getting their initial venture capital rounds. dollars went to California-based portfolio companies,
This is more than one-third of the total number of first a record for MoneyTree™, companies in 48 states and
fundings. The nearest sector to Software was Media DC received financing, also a MoneyTree™ record
and Entertainment with 174 first fundings. high. That said, the five largest states (California,
Massachusetts, New York, Washington and Texas)
received 78% of all the dollars invested nationally.
Stages and First-Time Fundings
Seed stage companies received 3% of total dollars in This compares to 2011, when California companies
2012, with early stage, expansion, and later stage received a then-record 51.2% of the dollars. That year,
companies roughly splitting the remaining share. companies in a record 47 states and DC received ven-
More than one-third of the capital went to expansion- ture capital funding. Together, the top five states
stage companies. But it is worth looking more close- (California, Massachusetts, New York, Texas, and
ly at those statistics. Illinois) received 77% of the total dollars.
Thomson Reuters 27
California-domiciled venture capital firms made Methodology

investments in 39 states in 2012. Approximately 49%
of all the money invested in California came from As calculated by Thomson Reuters, venture capital
California-domiciled firms. Conversely, California- investment data are derived from several sources.
based firms concentrated 71% of their investment Primarily, survey information is obtained from the
power within the state. quarterly survey that drives the MoneyTree Report™
from PricewaterhouseCoopers and the National
Venture Capital Association based on data from
Corporate Venture Group Involvement Thomson Reuters. This is the official industry database
The number and reach of corporate venture capital of venture capital investment. Secondly, Thomson
groups increased in 2012. These groups provided Reuters obtains data from SEC filings that are regular-
8.2% of the venture capital invested by all venture ly monitored by our research staff. Finally, publicly
groups. They were involved in 15.2% of the deals - available sources such as press releases and trade pub-
the highest level in four years. Going forward, all lications are used.
signs suggest that these groups are becoming more
involved alongside traditional venture firms in deals, For detailed information on which transactions quali-
as well as initiating corporate venture group syndi- fy as MoneyTree deals and are therefore counted in
cates to do deals in lieu of, or in advance of, invest- this chapter, please refer to Appendix B.
ment rounds by traditional venture firms.
28 Thomson Reuters
2013 NVCA Yearbook
Figure 3.01
Venture Capital Investments ($ Billions)
1985 to 2012
120
100
80
($ Billions)
60
40
20
0
7
7
0
8
0
8
1
0
6
9
9
9
5
4
5
5
2
4
2
3
2
3
200
201
199
199
200
198
200
200
199
199
198
198
200
200
201
199
198
200
199
200
198
199
199
200
200
201
199
199
Year
Figure 3.02
By Industry Group
All Investments Initial Investments

Investment Investment
Industry Group # Companies # Deals Amt ($Bil) # Companies # Deals Amt ($Bil)
Information Technology 2,130 2,480 16.5 870 870 3.0
Medical/Health/Life Science 649 818 6.8 148 148 0.7
Non-High Technology 364 425 3.4 156 156 0.4
Total 3,143 3,723 26.7 1,174 1,174 4.1
Figure 3.03
Venture Capital Investments
Top 5 States in 2012
Amt
State # Companies # Deals Invested ($Bil)
California 1,280 1,532 14.1
Massachusetts 326 414 3.1
New York 287 331 1.9
Washington 101 117 0.9
Texas 134 159 0.9
Total* 2,128 2,553 20.9
*Total includes top 5 states only
Thomson Reuters 29
Figure 3.04
Industry Sector by Dollars Invested
Telecommunications 2% Other
0.2%
Biotechnology
15%
Business Products
Software 31% and Services 0.4%
Computers and
Peripherals 2%
Consumer Products
and Services 5%
Electronics/
Instrumentation 1%
Financial Services 1%
Healthcare Services 1%
Semiconductors Industrial/Energy 10%

3%
Retailing/
Distribution 2%
Networking and
Equipment 1% IT Services 7%
Medical Devices
and Equipment 9% Media and
Entertainment 7%
Figure 3.05
Stage By Dollars Invested
Seed 3%
Later Stage 32%

Early Stage 30%
Expansion 35%
30 Thomson Reuters
2013 NVCA Yearbook
Figure 3.06
Amount of Capital Invested By State in 2012
($ Millions)
932 61
574
WA
WA
NH
13
615 27 4
243
263 ME
MT
MT
ND
ND VT
124
101 MN
MN
OR
OR 15 1,857 3,068 MA
15 0 95
23
NY
ID
ID
WY WI 232
WY SD WI 85 RI
MI
584 518
11
NE
PA 158 CT
NE IAIA 286
7 570 84 429 NJ
15
304 OH
14,129 NV
NV
178
564
468 IL IN 15
UT
UT
CO 46 23 VW 372 VA 9 DE
18
CA CO 8 21
24 DE
KS
KS MO
MO KY
169 NC 280
277 MD
34 87 TN MD
212
111
5 6 DC
357 OK AR 39
AZ
AZ NM
AR SC
NM
23 265
302
010 43
GA
AL
AL GA
931 11 MS
MS
645
TX
TX LA
AK
AK
203 GU
FL
17
HI
HI PR
VI
Figure 3.07
Number of Companies Invested in By State in 2012
101 812
NH
NH
WA
31 12 5
26
33
45 ME
24
MT
MT ND
ND VT
VT
MN
MN
250
OR 4 326 MA
1 12 9
287 MA
ID NY
WY
WY SD WI
WI 41
MI 154 12 RI
5
NE
1
PA 38 CT
NE IA 5144
4 14 49 NJ
37 76 OH
OH
1,280 31
85 IN 2
NV UT
UT 56 IL WV 62 56
CA CO
CO 915 812 5 VA DE
DE
KS
KS
MO
MO KY
33 NC 50
57
7 30 TN MD
MD
13 1
12
12 OK AR 5 25
AZ NM
AR SC DC
NM 44
38
32 68
GA
GA
MS
MS AL
AL
134
94 4
AK TX
TX LA
31 GU
FL
32
HI
HI 1 PR
VI
Thomson Reuters 31
Figure 3.08
Venture Capital Investments in 1985 to 2012
By Region ($ Millions)
Region 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2 01 0 2 011 2 01 2
Silicon Valley 758.8 1,016.3 849.9 985.9 916.5 914.1 780.5 1,119.5 903.2 1,074.4 1,807.8 3,417.7 4,632.3 5,878.3 17,801.6 33,452.0 12,599.3 7,242.9 6,755.6 7,999.3 8,116.3 9,816.8 11,554.7 11,436.4 8,220.5 9,302.8 11,656.8 10,907.4
NewEngland 435.4 436.6 525.1 496.9 404.7 425.0 287.0 417.0 358.4 440.4 796.6 1,159.4 1,606.7 2,353.4 5,641.6 12,019.9 5,431.2 2,992.3 2,990.4 3,345.5 2,967.1 3,310.8 3,964.5 3,788.3 2,577.6 2,604.3 3,318.1 3,237.4
NYMetro 221.2 211.0 273.9 308.0 360.4 190.1 181.5 239.0 222.3 283.3 509.7 743.2 1,289.4 1,817.6 4,532.3 10,300.4 3,512.8 1,569.4 1,422.0 1,648.2 1,998.5 2,185.5 1,902.8 2,148.7 1,737.3 1,886.2 2,859.8 2,334.6
LA/Orange County 196.5 186.9 276.9 222.5 242.1 174.7 119.4 179.4 176.4 198.4 1,004.1 702.9 875.2 1,250.6 3,596.9 6,808.1 2,285.8 1,286.8 1,069.4 1,319.8 1,506.1 1,902.7 1,906.3 2,041.1 1,060.1 1,704.5 2,080.4 2,067.2
Midwest 157.5 139.9 198.4 132.3 183.2 155.9 181.4 165.2 276.9 432.6 470.3 743.3 919.6 1,653.5 2,729.2 5,776.7 2,182.4 976.9 913.6 712.5 918.0 1,010.1 1,167.9 1,364.6 952.8 1,340.0 1,769.2 1,386.7
SanDiego 99.6 95.4 107.8 149.8 145.5 113.3 115.7 111.2 133.0 220.5 276.8 485.2 516.0 669.1 1,429.5 2,302.3 1,579.1 996.2 825.8 1,197.8 1,203.9 1,223.6 1,844.4 1,209.4 949.0 896.9 926.6 1,116.7
Northwest 142.2 142.9 153.3 141.2 118.0 88.2 59.9 252.1 118.4 165.7 379.7 557.6 564.4 820.3 2,877.6 3,603.4 1,426.8 746.4 643.5 993.3 1,011.3 1,318.2 1,636.2 1,134.7 678.7 774.9 796.6 1,076.0
Texas 249.0 228.4 211.0 240.7 228.3 141.0 161.4 149.6 240.7 311.8 479.2 553.4 908.7 1,205.6 3,162.7 6,262.9 3,104.3 1,187.6 1,221.0 1,215.1 1,189.4 1,519.7 1,496.9 1,122.6 665.5 1,070.9 1,580.2 930.5
Southeast 166.4 234.2 271.0 266.5 224.4 145.9 109.4 346.6 405.8 362.3 876.6 1,165.0 1,366.1 1,794.8 4,831.0 7,976.1 2,684.7 1,772.7 1,117.9 1,439.2 1,101.3 1,228.2 1,812.4 1,389.3 1,045.0 1,109.4 1,210.2 796.2
DC/Metroplex 99.1 61.1 111.8 129.9 139.5 96.9 51.3 65.8 384.1 137.8 420.2 586.3 515.1 1,148.5 2,395.1 5,785.3 2,103.1 1,095.6 794.6 1,086.6 1,220.4 1,361.6 1,443.5 1,145.8 678.4 967.2 987.2 727.4
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 1,845.8 4,091.9 1,244.4 588.0 644.8 363.2 653.4 688.8 686.3 872.3 623.2 447.9 615.7 564.2
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 1,387.5 515.1 393.8 220.5 393.6 524.8 526.6 577.7 490.1 277.5 263.8 543.1 558.4
Philadelphia Metro 52.6 63.3 79.2 71.8 65.3 105.9 34.7 168.9 108.3 137.6 220.9 349.9 534.2 703.9 1,732.6 2,591.5 1,073.3 607.8 555.1 768.4 597.8 845.5 953.6 861.9 433.7 444.7 458.9 399.0
North Central 37.0 44.5 73.6 41.6 51.2 92.2 44.9 89.1 109.6 87.4 223.8 208.5 341.6 429.6 770.0 1,426.7 669.4 431.5 268.5 464.1 367.0 382.1 535.7 644.6 400.3 343.3 392.5 355.8
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 67.4 196.7 360.1 446.9 110.4 69.3 65.5 130.1 96.1 64.3 152.8 91.3 25.0 77.7 106.2 95.7
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 90.3 195.4 212.4 293.9 159.1 104.5 122.7 104.8 60.1 156.2 136.5 92.3 26.9 44.8 106.7 48.7
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 14.3 - - - - - - - 0.5 - - 29.5
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 86.8 119.1 375.3 203.0 65.4 32.2 38.4 37.7 29.4 82.0 71.3 18.8 22.5 88.3 20.1
AK/HI/PR - - - - - - 0.3 0.0 1.0 22.0 7.8 28.7 14.0 5.5 17.4 248.6 69.8 4.9 17.9 15.1 43.3 47.1 20.9 21.3 7.4 14.0 0.6 0.7
Total 2,776.4 3,124.5 3,363.6 3,406.0 3,319.6 2,822.4 2,254.0 3,586.3 3,656.8 4,157.6 8,012.6 11,341.5 14,974.9 21,489.9 54,900.3 105,200.0 40,968.3 22,132.3 19,681.1 23,235.1 23,612.5 27,617.2 31,871.5 29,925.9 20,378.3 23,315.7 29,497.2 26,652.4
Figure 3.08b
Venture Capital Investments in 1985 to 2012
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 2 004 2005 2 006 2007 2 008 2 0 09 2 01 0 2 01 1 2 01 2
Silicon Valley 323 340 343 362 394 398 337 421 316 336 509 771 867 1,043 1,685 2,159 1,103 817 874 958 1,006 1,236 1,305 1,290 990 1,092 1,248 1,160
New England 235 214 257 231 222 217 170 159 149 146 232 333 383 469 663 904 597 457 446 427 440 458 521 510 387 411 448 452
NY Metro 89 100 131 108 121 90 89 81 80 85 135 158 240 274 491 818 448 232 193 227 192 294 296 342 287 393 415 396
Midwest 98 116 133 101 127 103 99 93 85 83 132 192 239 250 311 515 276 243 174 178 181 230 272 304 252 272 311 300
LA/Orange County 90 101 114 106 112 97 89 97 63 55 92 134 166 217 356 518 251 164 149 150 178 219 234 243 170 227 233 264
Southeast 91 117 134 115 113 130 112 108 117 112 181 226 294 308 454 665 391 270 247 246 198 238 246 227 159 216 211 171
DC/Metroplex 45 45 65 59 51 62 54 48 41 47 72 113 135 162 272 510 261 199 183 187 222 220 220 208 139 152 162 163
Texas 106 93 106 105 91 85 70 70 71 69 101 135 172 197 318 484 341 173 173 177 181 201 188 161 123 165 167 159
Northwest 47 49 62 70 64 48 41 50 49 50 84 112 134 132 264 329 192 140 108 148 160 184 216 205 129 161 167 154
Philadelphia Metro 38 35 54 44 41 48 43 65 47 46 78 91 142 138 145 231 142 102 88 105 97 116 138 153 97 124 119 118
San Diego 43 35 54 56 56 47 43 46 49 61 77 109 100 123 161 236 156 114 125 132 143 128 169 134 115 134 113 101
Colorado 43 58 62 63 53 49 35 53 48 53 58 83 98 127 162 222 115 91 74 72 93 110 114 116 94 86 107 100
SouthWest 20 30 42 26 32 22 30 34 30 29 37 55 71 88 116 146 89 68 55 58 84 93 106 84 71 59 84 77
North Central 37 50 54 52 39 44 40 39 38 37 70 69 116 106 114 151 125 75 71 77 67 73 95 88 68 58 70 50
Upstate NY 17 10 10 10 12 6 4 9 10 5 8 9 21 31 31 36 29 24 22 29 28 39 33 31 13 21 21 24
South Central 11 10 12 6 7 5 4 5 6 9 15 22 25 27 30 50 28 24 21 31 11 26 31 40 32 42 58 22
Sacramento/N.Cal 11 18 12 10 6 10 9 9 8 10 7 9 7 17 19 36 27 7 11 9 11 8 18 20 9 8 8 5
AK/HI/PR 1 - - - - - 3 3 1 2 4 9 6 5 5 15 10 3 8 6 8 14 10 9 3 4 3 4
Unknown - - 1 2 3 1 1 2 4 2 2 7 7 14 3 16 8 - - - - - 1 - 1 1 1 3
Total 1,345 1,421 1,646 1,526 1,544 1,462 1,273 1,392 1,212 1,237 1,894 2,637 3,223 3,728 5,600 8,041 4,589 3,203 3,022 3,217 3,300 3,887 4,213 4,165 3,139 3,626 3,946 3,723
32 Thomson Reuters
2013 NVCA Yearbook
Figure 3.09
1985 to 2012 By Stage ($ Millions)
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20112011 20122012
S SSeed 526.2 759.7 623.4 670.5 558.4 397.1 241.8 556.5 629.6 781.2 1,272.9 1,271.7 1,374.2 1,766.2 3,666.2 3,156.1 800.7 340.2 365.7 951.6 1,006.3 1,293.6 1,819.6 1,917.3 1,870.7 1,661.3 1,052.6 726.4
Early Stage 517.8 620.3 750.5 714.6 737.6 684.4 548.7 566.8 575.8 839.7 1,733.4 2,640.5 3,420.5 5,460.1 11,360.2 25,335.4 8,606.3 3,935.3 3,608.5 4,045.9 4,056.3 4,727.4 6,081.5 5,731.0 4,906.9 5,867.0 8,794.4 7,876.3
Expansion 1,245.7 1,198.8 1,495.1 1,563.2 1,595.8 1,269.2 1,100.2 1,778.7 1,866.0 1,539.1 3,564.2 5,540.4 7,588.6 10,367.0 29,406.8 59,121.5 22,911.7 12,135.5 9,805.5 9,046.2 8,607.9 11,154.8 11,091.8 10,857.4 6,824.2 8,702.0 9,830.5 9,376.4
LaterStage 486.8 545.7 494.6 457.7 427.8 471.7 363.3 684.3 585.4 985.7 1,442.2 1,888.9 2,591.6 3,905.5 10,467.0 17,587.0 8,649.6 5,721.1 5,901.4 9,191.5 9,942.0 10,441.5 12,882.2 11,420.1 6,776.5 7,085.4 9,819.7 8,673.3
Total 2,776.4 3,124.5 3,363.6 3,406.0 3,319.6 2,822.4 2,254.0 3,586.3 3,656.8 4,145.7 8,012.6 11,341.5 14,974.9 21,498.9 54,900.3 105,200.0 40,968.3 22,132.0 19,681.1 23,235.1 23,612.5 27,617.2 31,875.1 29,925.9 20,378.3 23,315.7 29,497.2 26,652.4
Figure 3.09b
1985 to 2012 By Stage (Number of Deals)
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Seed 357 388 387 371 355 258 193 252 290 332 431 504 542 670 811 703 279 181 216 234 264 396 524 537 375 409 445 280
Early Stage 290 333 412 359 338 370 278 291 184 256 519 754 896 1,019 1,735 2,855 1,299 875 799 899 859 1,001 1,129 1,137 973 1,271 1,562 1,647
Expansion 525 504 616 614 664 603 544 606 515 429 706 1,045 1,402 1,572 2,445 3,703 2,392 1,585 1,355 1,201 1,116 1,380 1,277 1,242 888 1,074 1,021 962
Later Stage 173 196 231 182 187 231 258 243 223 220 238 334 383 467 609 780 619 562 652 883 1,061 1,110 1,283 1,249 903 872 918 834
Total 1,345 1,421 1,646 1,526 1,544 1,462 1,273 1,392 1,212 1,237 1,894 2,637 3,223 3,728 5,600 8,041 4,589 3,203 3,022 3,217 3,300 3,887 4,213 4,165 3,139 3,626 3,946 3,723
Figure 3.09c-1
Quarterly Venture Capital Investments
1985 1986 1987 1988

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 1988-1Q 1988-2Q 1988-3Q 1988-4Q 1988 Total
Seed 153.0 146.5 93.7 133.0 526.2 185.6 270.0 114.7 189.4 759.7 145.7 199.4 142.0 136.3 623.4 164.7 150.0 240.6 115.2 670.5
Early Stage 96.3 185.3 106.3 129.9 517.8 129.6 135.3 176.6 178.7 620.3 170.7 183.9 205.1 190.8 750.5 144.0 216.6 184.7 169.4 714.6
Expansion 219.5 319.6 312.8 393.7 1,245.7 270.0 381.4 252.6 294.8 1,198.8 423.3 354.2 402.5 315.1 1,495.1 314.5 497.1 320.2 431.4 1,563.2
Later Stage 154.4 89.4 164.4 78.5 486.8 125.3 93.2 180.4 146.7 545.7 100.1 164.9 118.9 110.7 494.6 135.3 105.0 151.4 66.0 457.7
Total 623.1 740.8 677.2 735.1 2,776.4 710.5 879.9 724.4 809.6 3,124.5 839.7 902.4 868.5 752.9 3,363.6 758.5 968.6 896.9 781.9 3,406.0
Figure 3.09c-2
1989 1990 1991 1992

Seed 138.1 174.6 115.4 130.3 558.4 81.9 116.7 114.8 83.8 397.1 45.8 84.6 53.4 58.0 241.8 67.6 210.2 71.8 206.8 556.5
Early Stage 255.9 127.7 163.1 190.9 737.6 139.7 199.1 133.1 212.5 684.4 137.9 130.3 140.4 140.0 548.7 123.0 187.6 102.7 153.4 566.8
Expansion 399.6 434.1 305.5 456.6 1,595.8 307.2 356.1 208.0 397.9 1,269.2 249.5 276.2 262.9 311.7 1,100.2 496.3 434.8 352.2 495.4 1,778.7
Later Stage 95.5 97.7 78.3 156.4 427.8 123.1 105.5 126.3 116.7 471.7 89.5 115.8 57.9 100.1 363.3 203.2 175.3 107.0 198.8 684.3
Total 889.1 834.1 662.2 934.2 3,319.6 651.9 777.4 582.2 810.9 2,822.4 522.8 606.9 514.5 609.9 2,254.0 890.2 1,007.9 633.8 1,054.5 3,586.3
Thomson Reuters 33
Figure 3.09c-3
1993 1994 1995 1996

Seed 139.7 144.1 164.3 181.5 629.6 190.0 225.8 160.2 205.1 781.2 316.6 396.6 229.9 329.8 1,272.9 322.7 431.9 200.6 316.5 1,271.7
Early Stage 164.3 136.8 106.6 168.0 575.8 177.6 196.4 157.8 307.9 839.7 408.8 393.6 366.8 564.1 1,733.4 597.8 714.0 574.6 754.1 2,640.5
Expansion 355.0 412.3 461.3 637.3 1,866.0 325.3 390.5 344.2 479.1 1,539.1 620.0 1,328.2 800.4 815.7 3,564.2 1,151.9 1,509.9 1,277.0 1,601.6 5,540.4
Later Stage 189.2 111.2 116.8 168.3 585.4 186.6 190.5 262.0 346.6 985.7 344.5 428.0 308.7 361.1 1,442.2 346.4 460.3 545.4 536.8 1,888.9
Total 848.3 804.4 849.0 1,155.2 3,656.8 879.5 1,003.3 924.2 1,338.7 4,145.7 1,689.9 2,546.4 1,705.8 2,070.6 8,012.6 2,418.8 3,116.1 2,597.6 3,208.9 11,341.5
Figure 3.09c-4
1997 1998 1999 2000
Seed 400.6 330.8 323.3 319.5 1,374.2 402.6 426.4 459.9 477.3 1,766.2 591.5 840.4 989.7 1,244.5 3,666.2 807.0 984.1 878.3 486.8 3,156.1
Early Stage 769.5 846.8 760.1 1,044.1 3,420.5 1,164.7 1,014.5 1,290.4 1,990.6 5,460.1 1,215.0 1,993.7 2,661.8 5,489.7 11,360.2 7,138.2 6,937.9 5,912.3 5,347.0 25,335.4
Expansion 1,358.4 1,958.5 1,970.6 2,301.0 7,588.6 1,753.9 3,359.1 2,716.0 2,538.0 10,367.0 3,210.3 5,498.5 7,348.1 13,350.0 29,406.8 16,113.3 15,761.4 15,263.6 11,983.2 59,121.5
Later Stage 594.7 531.6 669.3 795.9 2,591.6 854.6 973.6 949.5 1,127.9 3,905.5 1,605.2 2,999.2 2,597.5 3,265.1 10,467.0 4,382.9 4,343.2 4,572.9 4,288.1 17,587.0
Total 3,123.3 3,667.8 3,723.3 4,460.5 14,974.9 4,175.7 5,773.5 5,415.7 6,133.9 21,498.9 6,622.0 11,331.8 13,597.1 23,349.3 54,900.3 28,441.3 28,026.6 26,627.0 22,105.1 105,200.0
Figure 3.09c-5
2001 2002 2003 2004
Seed 256.6 265.3 128.5 150.3 800.7 76.4 93.5 84.2 86.1 340.2 84.5 95.2 100.3 85.8 365.7 104.8 124.3 168.0 554.5 951.6
Early Stage 3,459.5 2,102.1 1,712.2 1,332.5 8,606.3 1,182.2 1,134.1 827.7 791.4 3,935.3 690.0 1,015.7 806.8 1,096.0 3,608.5 904.9 1,030.3 1,028.6 1,082.0 4,045.9
Expansion 6,939.3 6,622.1 4,563.8 4,786.5 22,911.7 3,804.8 3,544.3 2,462.6 2,323.8 12,135.5 2,468.7 2,513.9 2,202.5 2,620.3 9,805.5 2,063.3 2,680.0 2,043.1 2,259.7 9,046.2
Later Stage 2,447.6 2,513.1 1,802.4 1,886.5 8,649.6 1,927.7 1,339.6 1,094.4 1,359.4 5,721.1 1,159.6 1,368.7 1,520.5 1,852.6 5,901.4 2,312.6 2,481.9 1,856.6 2,540.4 9,191.5
Total 13,103.0 11,502.5 8,206.9 8,155.9 40,968.3 6,991.1 6,111.4 4,468.8 4,560.7 22,132.0 4,402.8 4,993.4 4,630.1 5,654.7 19,681.1 5,385.6 6,316.6 5,096.3 6,436.6 23,235.1
Figure 3.09c-6
2005 2006 2007 2008
Seed 148.5 530.5 165.0 162.2 1,006.3 246.7 374.0 366.6 306.2 1,293.6 319.3 489.2 455.0 556.0 1,819.6 459.3 535.3 557.9 364.9 1,917.3
Early Stage 867.8 1,001.6 1,192.0 994.8 4,056.3 930.1 1,018.4 1,112.3 1,666.6 4,727.4 1,337.9 1,700.5 1,263.1 1,780.0 6,081.5 1,376.9 1,524.3 1,372.6 1,457.2 5,731.0
Expansion 2,132.9 2,367.4 1,759.6 2,348.1 8,607.9 2,604.7 3,211.1 2,881.2 2,457.7 11,154.8 2,646.9 2,353.2 3,104.8 2,986.9 11,091.8 3,427.7 2,697.9 2,556.8 2,175.0 10,857.4
Later Stage 2,082.1 2,551.8 2,972.5 2,335.5 9,942.0 2,847.4 2,793.3 2,529.5 2,271.4 10,441.5 3,108.6 3,289.9 3,389.9 3,093.8 12,882.2 2,813.0 3,272.5 3,137.7 2,197.1 11,420.1
Total 5,231.3 6,451.3 6,089.1 5,840.7 23,612.5 6,629.0 7,396.8 6,889.6 6,701.9 27,617.2 7,412.6 7,832.8 8,213.0 8,416.7 31,875.1 8,076.8 8,030.0 7,625.0 6,194.1 29,925.9
Figure 3.09c-7
2009 2010 2011 2012
Seed 319.7 672.4 511.0 367.6 1,870.7 407.9 687.8 332.5 233.1 1,661.3 225.2 413.4 221.7 192.4 1,052.6 157.9 230.6 181.0 156.9 726.4
Early Stage 767.3 1,179.6 1,213.6 1,746.5 4,906.9 1,147.8 1,740.3 1,410.4 1,568.5 5,867.0 1,830.3 2,272.4 2,233.2 2,458.5 8,794.4 1,933.7 2,190.2 1,824.0 1,928.3 7,876.3
Expansion 1,223.8 1,770.3 1,824.4 2,005.7 6,824.2 1,788.9 2,796.5 1,685.3 2,431.3 8,702.0 2,257.4 2,418.9 2,545.3 2,608.9 9,830.5 1,789.2 2,715.7 2,614.1 2,257.5 9,376.4
Later Stage 1,531.5 1,606.8 1,844.7 1,793.6 6,776.5 1,723.4 1,925.7 1,999.1 1,437.1 7,085.4 2,220.8 3,037.1 2,426.3 2,135.5 9,819.7 2,355.8 2,187.7 1,983.2 2,146.6 8,673.3
Total 3,842.2 5,229.1 5,393.7 5,913.3 20,378.3 5,067.9 7,150.2 5,427.4 5,670.2 23,315.7 6,533.7 8,141.7 7,426.5 7,395.3 29,497.2 6,236.6 7,324.2 6,602.3 6,489.4 26,652.4
34 Thomson Reuters
2013 NVCA Yearbook
Figure 3.09d-1
1985 1986 1987 1988
Seed 110 88 61 98 357 134 107 65 82 388 116 101 85 85 387 120 79 88 84 371
Early Stage 88 69 60 73 290 111 70 72 80 333 131 83 103 95 412 99 94 87 79 359
Expansion 138 122 114 151 525 166 136 96 106 504 182 139 158 137 616 158 182 133 141 614
Later Stage 65 40 37 31 173 60 55 31 50 196 64 64 51 52 231 54 48 42 38 182
Total 401 319 272 353 1,345 471 368 264 318 1,421 493 387 397 369 1,646 431 403 350 342 1,526
Figure 3.09d-2
1989 1990 1991 1992
Seed 106 100 77 72 355 60 69 59 70 258 51 49 42 51 193 49 68 49 86 252
Early Stage 101 65 84 88 338 87 97 73 113 370 79 69 60 70 278 73 86 52 80 291
Expansion 215 160 127 162 664 148 153 145 157 603 137 127 126 154 544 156 160 104 186 606
Later Stage 52 33 38 64 187 55 57 48 71 231 49 69 54 86 258 74 47 44 78 243
Total 474 358 326 386 1,544 350 376 325 411 1,462 316 314 282 361 1,273 352 361 249 430 1,392
Figure 3.09d-3
1993 1994 1995 1996
Seed 69 68 66 87 290 91 67 83 91 332 125 95 95 116 431 130 140 97 137 504
Early Stage 41 49 38 56 184 64 61 54 77 256 130 136 116 137 519 148 206 175 225 754
Expansion 145 121 116 133 515 105 111 98 115 429 187 179 164 176 706 235 247 245 318 1,045
Later Stage 67 53 52 51 223 50 69 43 58 220 61 55 58 64 238 71 82 85 96 334
Total 322 291 272 327 1,212 310 308 278 341 1,237 503 465 433 493 1,894 584 675 602 776 2,637
Figure 3.09d-4
1997 1998 1999 2000
Seed 163 120 120 139 542 152 162 164 192 670 166 211 249 185 811 196 197 172 138 703
Early Stage 201 208 228 259 896 242 221 243 313 1,019 245 380 448 662 1,735 763 793 680 619 2,855
Expansion 310 361 320 411 1,402 366 407 405 394 1,572 383 567 595 900 2,445 1,009 981 899 814 3,703
Later Stage 100 87 90 106 383 108 121 114 124 467 140 174 150 145 609 192 172 207 209 780
Total 774 776 758 915 3,223 868 911 926 1,023 3,728 934 1,332 1,442 1,892 5,600 2,160 2,143 1,958 1,780 8,041
Figure 3.09d-5
2001 2002 2003 2004
Seed 80 73 68 58 279 47 53 40 41 181 57 60 44 55 216 46 75 45 68 234
Early Stage 436 338 271 254 1,299 247 242 193 193 875 188 215 183 213 799 207 238 222 232 899
Expansion 650 670 543 529 2,392 410 447 348 380 1,585 346 320 336 353 1,355 281 349 261 310 1,201
Later Stage 155 156 148 160 619 160 136 128 138 562 132 160 168 192 652 205 216 194 268 883
Total 1,321 1,237 1,030 1,001 4,589 864 878 709 752 3,203 723 755 731 813 3,022 739 878 722 878 3,217
Thomson Reuters 35
Figure 3.09d-6
2005 2006 2007 2008

Seed 52 68 68 76 264 82 93 121 100 396 90 139 136 159 524 135 134 156 112 537
Early Stage 212 219 214 214 859 205 241 236 319 1,001 257 326 257 289 1,129 265 301 284 287 1,137
Expansion 275 295 242 304 1,116 328 360 345 347 1,380 277 322 319 359 1,277 344 331 282 285 1,242
Later Stage 223 280 286 272 1,061 290 314 253 253 1,110 282 326 336 339 1,283 310 338 323 278 1,249
Total 762 862 810 866 3,300 905 1,008 955 1,019 3,887 906 1,113 1,048 1,146 4,213 1,054 1,104 1,045 962 4,165
Figure 3.09d-7
2009 2010 2011 2012
Seed 70 87 99 119 375 93 119 99 98 409 94 128 114 109 445 61 78 73 68 280
Early Stage 195 213 244 321 973 268 361 308 334 1,271 344 392 401 425 1,562 350 433 411 453 1,647
Expansion 183 217 219 269 888 252 300 244 278 1,074 225 275 277 244 1,021 221 250 244 247 962
Later Stage 229 244 199 231 903 205 239 230 198 872 234 279 212 193 918 229 197 192 216 834
Total 677 761 761 940 3,139 818 1,019 881 908 3,626 897 1,074 1,004 971 3,946 861 958 920 984 3,723
Figure 3.10
1985 to 2012 By Industry ($ Millions)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SSoftware 612 577 519 482 457 519 463 614 459 671 1,186 2,350 3,462 4,721 10,690 25,251 10,820 5,509 4,855 5,483 5,144 5,449 6,124 6,069 4,205 5,116 7,516 8,293
Biotechnology 136 223 290 369 334 314 287 581 479 585 832 1,186 1,368 1,551 2,101 4,270 3,480 3,312 3,745 4,388 3,930 4,816 5,713 4,970 3,972 3,903 4,825 4,115
Industrial/Energy 201 208 290 222 345 242 183 285 278 294 527 498 704 1,260 1,464 2,627 1,250 826 774 847 1,138 1,996 3,082 4,631 2,564 3,465 3,595 2,792
Medical Devices and Equipment 181 182 259 340 347 325 235 514 393 439 668 618 1,026 1,256 1,577 2,403 2,046 1,863 1,613 1,905 2,209 2,778 3,759 3,603 2,605 2,341 2,883 2,511
IT Services 26 38 51 39 36 38 41 29 54 119 175 442 640 1,093 4,323 8,890 2,475 978 747 748 1,057 1,482 1,930 2,108 1,228 1,661 2,264 1,993
Media and Entertainment 101 118 155 166 151 93 69 132 278 275 944 1,154 1,056 1,873 7,408 10,598 2,370 784 662 1,410 1,200 1,888 2,166 1,796 1,371 1,572 2,258 1,976
Consumer Products and Services 69 135 176 153 86 159 126 123 159 176 534 510 742 680 2,718 3,220 702 256 157 334 363 424 454 418 489 571 1,399 1,208
Semiconductors 253 293 255 294 165 190 90 156 93 157 214 340 597 631 1,380 3,806 2,474 1,654 1,767 2,166 1,855 2,307 2,041 1,595 773 1,046 1,345 926
Telecommunications 178 174 148 161 124 128 117 200 251 463 937 1,323 1,562 3,024 8,032 16,468 5,179 2,168 1,674 1,854 2,150 2,414 2,191 1,514 636 792 631 582
Retailing/Distribution 32 114 296 232 217 89 48 97 103 103 303 269 326 769 2,810 3,209 368 139 64 217 249 189 340 222 156 165 454 498
Computers and Peripherals 449 473 392 370 311 245 174 205 164 178 316 363 394 383 939 1,628 693 457 360 538 535 388 550 470 345 408 494 453
Networking and Equipment 224 164 143 137 197 174 140 250 516 250 372 631 962 1,446 4,658 11,730 5,791 2,671 1,739 1,559 1,695 1,252 1,443 756 753 678 357 316
Healthcare Services 81 125 140 97 155 92 72 191 202 202 460 734 939 959 1,495 1,386 543 380 229 389 364 416 307 159 171 272 394 309
Financial Services 81 96 62 209 233 63 25 120 102 123 181 323 385 843 2,215 4,131 1,238 331 413 530 903 528 580 464 404 408 394 284
Electronics/Instrumentation 120 121 122 77 110 58 74 51 50 65 151 211 307 202 274 797 400 309 209 395 412 703 557 646 393 422 437 244
Business Products and Services 29 81 64 53 52 94 77 39 70 40 176 369 434 706 2,590 4,726 1,085 478 673 460 408 586 621 475 260 491 215 97
Other 3 3 0 6 0 33 0 6 6 37 21 71 102 225 60 55 17 - 14 - - 18 30 56 4 37 53
Total 2,776 3,125 3,364 3,406 3,320 2,822 2,254 3,586 3,657 4,146 8,013 11,341 14,975 21,499 54,900 105,200 40,968 22,132 19,681 23,235 23,612 27,617 31,875 29,926 20,378 23,316 29,497 26,652
Figure 3.10b
1985 to 2012 By Industry (Number of Deals)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SSoftware 321 323 307 280 296 302 287 296 243 253 435 686 820 980 1,411 2,165 1,298 1,005 965 949 955 1,027 1,073 1,098 815 1,035 1,178 1,277
Biotechnology 73 98 138 153 138 145 138 164 136 140 176 236 242 274 260 355 337 326 357 400 405 483 526 530 458 493 466 463
Media and Entertainment 56 68 92 75 71 58 54 79 82 97 138 191 219 266 701 944 372 167 127 140 209 329 399 400 266 345 441 395
Medical Devices and Equipment 128 117 166 151 185 191 161 188 148 128 179 212 272 294 288 295 257 234 248 280 286 358 399 402 345 349 370 319
IT Services 23 25 33 24 27 31 30 22 19 33 62 127 162 207 456 687 324 170 147 151 172 236 281 286 221 303 362 315
Industrial/Energy 122 138 162 140 144 157 125 132 102 101 128 155 213 186 205 254 204 131 142 158 154 225 306 365 255 307 311 243
Consumer Products and Services 43 51 72 59 52 67 48 51 54 66 114 132 162 163 287 285 119 72 47 67 78 79 110 103 86 114 137 162
Semiconductors 84 72 92 91 80 78 51 60 45 38 64 74 116 120 148 256 209 169 214 258 218 266 224 206 132 137 136 108
Telecommunications 86 77 94 80 81 63 67 64 73 73 141 211 268 340 529 858 481 275 214 232 236 309 279 230 131 120 124 95
Retailing/Distribution 18 32 71 81 73 46 38 34 35 28 54 70 91 121 230 282 83 49 31 38 40 40 41 42 38 33 68 59
Computers and Peripherals 157 148 131 138 135 104 78 84 65 66 93 95 115 91 104 133 81 59 57 61 65 60 70 61 54 56 61 48
Financial Services 22 28 36 43 44 25 24 24 31 31 47 61 91 115 190 334 137 76 64 68 63 90 85 68 54 74 60 45
Healthcare Services 33 56 56 46 55 41 38 46 52 45 73 139 152 155 159 165 105 70 70 64 64 51 57 51 40 45 47 43
Networking and Equipment 80 76 73 69 71 74 65 83 65 77 82 123 140 211 279 481 335 232 186 193 186 137 146 106 101 63 49 38
Business Products and Services 20 42 51 38 32 28 20 25 32 22 50 69 94 139 279 459 177 102 97 83 83 99 113 119 72 75 61 35
Other 2 2 2 1 2 2 2 3 2 9 9 12 10 21 12 11 3 1 3 2 2 11 4 8 10 17 27
Total 1,345 1,421 1,646 1,526 1,544 1,462 1,273 1,392 1,212 1,237 1,894 2,637 3,223 3,728 5,600 8,041 4,589 3,203 3,022 3,217 3,300 3,887 4,213 4,165 3,139 3,626 3,946 3,723
36 Thomson Reuters
2013 NVCA Yearbook
Figure 3.11
Venture Capital Investments By State 1985 to 2012 ($ Millions)
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
CCA 1,070.9 1,344.1 1,266.7 1,391.8 1,308.3 1,221.6 1,031.3 1,418.6 1,231.6 1,513.3 3,108.7 4,634.4 6,044.9 7,884.8 22,947.1 42,937.7 16,667.2 9,591.2 8,683.1 10,555.3 10,864.0 12,972.4 15,387.4 14,758.1 10,248.4 11,926.7 14,752.2 14,128.8
MA 396.3 379.5 446.8 387.8 296.8 351.5 240.0 366.3 310.9 385.9 697.2 1,053.9 1,438.6 2,002.1 5,085.3
5,085 10,576.4 4,953.4 2,639.3 2,721.3 3,093.7 2,733.8 3,062.6 3,759.3 3,423.2 2,381.7 2,448.9 3,132.5 3,067.9
NY 114.5 71.2 100.5 112.1 158.7 48.8 45.0 143.8 103.9 69.9 303.3 293.3 786.2 1,402.4 3,428.6 6,715.8 1,948.7 767.0 669.8 786.2 1,094.7 1,458.1 1,316.5 1,513.4 1,068.8 1,400.0 2,429.0 1,856.7
WA 55.4 66.1 98.3 73.3 74.8 55.2 29.2 191.5 85.4 138.6 325.9 466.9 434.2 736.5 2,343.7 2,767.8 1,150.7 570.7 450.8 847.0 837.6 1,147.2 1,358.9 942.7 582.2 621.8 551.4 931.5
TX 249.0 228.4 211.0 240.7 228.3 141.0 161.4 149.6 240.7 311.8 479.2 553.4 908.7 1,205.6 3,162.7 6,262.9 3,104.3 1,187.6 1,221.0 1,215.1 1,189.4 1,519.7 1,496.9 1,122.6 665.5 1,070.9 1,580.2 930.5
IL 43.7 30.7 38.5 42.7 93.4 72.0 96.6 73.9 89.5 168.9 198.9 361.1 419.4 435.9 1,243.7 2,382.3 998.6 313.6 379.9 236.6 320.2 437.6 459.6 480.0 257.6 647.6 768.7 570.4
CO 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 1,845.8 4,091.9 1,244.4 588.0 644.8 363.2 653.4 688.8 686.3 872.3 623.2 447.9 615.7 564.2
PA 48.3 43.3 78.0 68.4 56.2 108.8 35.2 154.0 104.7 148.9 128.0 299.4 540.9 644.9 1,763.5 2,911.7 1,084.2 497.8 537.6 658.8 523.5 948.7 1,010.7 808.5 433.6 517.9 509.6 517.8
NJ 75.3 116.9 132.3 99.1 156.6 66.5 68.7 106.1 101.2 198.2 241.6 441.8 490.9 501.2 907.8
907 3,162.9 1,544.4 972.0 839.8 968.1 925.4 740.2 608.6 757.7 666.1 466.0 485.9 429.3
VA 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 3,325.2 1,004.2 429.0 397.3 291.1 536.7 461.9 644.9 559.6 240.9 409.3 617.7 372.3
UT 6.0 32.8 8.3 11.9 4.4 1.0 9.1 24.4 7.3 1.2 23.2 57.5 90.7 116.2 418.4 666.9 220.1 135.7 111.8 249.8 248.8 198.1 184.7 199.2 162.7 139.0 239.5 304.3
OH 34.7 55.7 44.8 53.4 32.7 27.9 19.6 27.1 34.3 67.3 68.7 164.5 181.9 319.1 508.0 1,013.6 247.1 266.0 193.9 89.9 136.5 91.2 226.4 275.8 122.7 175.2 432.5 285.7
MD 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 1,947.3 935.6 627.1 328.6 709.5 645.0 848.6 727.3 520.9 386.5 446.7 314.0 279.6
GA 55.8 111.4 66.6 97.2 53.7 20.9 47.1 192.7 143.4 93.5 155.8 247.1 371.9 504.5 1,164.1
1, 2,270.7 847.9 574.9 281.5 500.5 264.4 414.1 438.0 418.5 313.6 337.0 383.4 264.8
MN 24.4 29.9 35.4 26.0 37.6 78.7 38.7 64.1 37.1 55.4 192.3 149.9 256.8 340.0 616.5 981.1 475.0 343.3 208.2 388.3 274.0 300.5 413.1 481.0 284.8 142.1 283.1 242.6
MI 34.8 21.3 59.1 15.7 21.8 26.4 5.7 14.9 58.7 8.6 65.7 79.4 106.2 122.4 253.5 356.4 154.9 109.4 95.2 134.3 93.3 131.3 109.7 214.5 178.5 151.7 84.8 232.3
AZ 15.2 38.1 38.6 43.9 37.8 27.5 33.3 64.9 41.9 35.7 83.4 95.5 170.2 226.1 365.5 668.6 247.5 212.4 81.9 72.2 134.7 276.7 238.2 228.5 94.0 78.4 229.1 211.7
FL 31.1 34.5 70.8 82.5 44.3 34.6 22.5 71.9 127.7 102.8 270.9 398.9 436.5 625.3 1,697.4 2,700.1 937.3 401.7 326.1 427.6 346.0 323.8 599.3 327.5 347.6 239.4 350.2 202.9
NC 17.3 17.4 20.9 15.7 26.1 36.9 12.1 48.8 22.2 63.6 210.7 179.9 271.8 326.9 853.6 1,829.8 585.6 557.2 379.4 327.3 341.6 410.5 522.1 488.9 254.9 423.1 304.9 169.0
CT 71.6 76.9 101.3 167.7 89.6 134.5 86.5 57.8 33.3 82.5 141.3 146.0 264.9 345.2 889.2 1,550.8 608.2 191.9 223.6 251.6 209.6 289.0 271.0 236.1 190.2 133.2 156.7 157.6
OR 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 53.5 501.0 810.4 248.6 165.1 140.5 142.4 132.2 146.8 254.4 152.2 67.4 133.4 236.8 123.8
WI 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 92.6 51.2 37.6 66.0 67.8 72.6 90.2 71.6 25.9 135.0 72.9 95.2
TN 43.5 53.5 76.1 42.7 73.8 38.8 21.1 7.0 44.3 40.6 157.7 178.2 106.6 107.3 581.0 458.3 193.3 122.5 82.6 96.2 101.5 35.2 126.7 84.3 75.0 67.8 107.4 87.2
RI 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 92.6 118.7 95.9 62.8 58.0 72.8 77.2 4.5 16.1 30.0 59.3 42.2 85.1
IN 13.3 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 56.5 40.1 24.5 67.8 123.7 32.8 70.6 93.7 232.1 80.0 177.9 84.1
DC 18.9 14.8 4.7 17.2 0.0 2.5 0.8 4.8 1.1 4.3 0.8 6.7 5.2 46.9 539.7 508.3 161.8 23.5 56.1 80.2 28.1 46.2 60.5 35.4 49.2 107.5 53.4 61.0
NH 5.3 14.8 15.1 27.7 29.5 16.2 29.2 6.8 31.7 7.9 30.5 42.9 53.3 167.8 233.8 767.9 257.9 225.7 167.1 127.6 97.2 84.1 154.1 194.8 52.1 56.9 56.3 60.7
KS 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 40.3 8.9 27.0 48.7 7.2 31.5 123.4 59.5 7.5 41.7 57.2 46.2
SC 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 10.1 45.3 11.8 13.6 2.7 8.3 86.9 21.2 7.1 41.6 59.7 39.5
NM 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 14.2 13.9 3.6 24.0 76.4 32.1 131.1 49.8 5.5 12.4 64.9 35.2
OK 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 13.8 33.0 35.1 68.1 80.8 14.9 8.1 17.3 4.5 13.0 27.1 34.0
AL 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
65 278.5 80.3 66.1 35.7 69.2 35.2 19.9 34.4 48.8 45.4 0.6 3.5 23.1
KY 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 88.9 13.8 5.4 48.2 32.0 28.2 54.1 22.8 17.3 16.7 12.5 23.1
MO 8.8 4.3 11.1 1.6 9.4 7.5 34.9 25.2 55.1 70.5 98.5 56.1 72.6 611.7 309.1 655.8 267.4 81.0 79.5 26.0 127.7 57.8 47.6 92.5 17.4 97.0 134.4 21.2
ID 0.3 - - - - - - 5.0 0.2 0.1 15.2 0.1 1.2 30.3 16.5 8.5 2.7 10.6 52.2 2.5 10.0 17.8 18.7 22.8 14.6 7.8 5.1 15.2
WV 1.1 2.0 0.1 0.0 - 0.1 - - 0.0 - - - 23.8 2.0 - 4.5 1.4 15.9 12.6 5.8 10.5 4.9 10.8 30.0 3.0 3.8 2.1 14.6
ME 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 3.9 16.9 2.7 26.0 5.1 39.9 7.8 5.4 11.4 4.3 38.6 12.8
ME 0.5 - - 1.5 - - - - 38.0 3.5 0.5 10.4 3.7 29.1 57.3 163.1 90.1 16.9 4.6 0.2 13.1 7.5 2.9 27.8 - 11.5 - 10.6
LA 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 46.0 17.7 2.3 9.6 3.0 11.4 15.1 14.5 13.0 18.0 21.9 10.5
MS 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.
2 7 23.5 30.0 5.0 0.9 4.9 10.0 16.2 5.0 - 1.3 - 1.0 9.8
DE 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
16 134.7 14.6 19.4 0.4 2.1 11.1 5.3 7.3 79.0 20.6 32.2 26.2 9.5
NV - 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 33.3 31.8 23.2 47.6 64.9 19.6 23.7 12.6 15.4 33.9 9.5 7.1
MT 1.6 1.7 3.3 1.1 - - 1.0 - - - - - - - 16.3 16.7 24.8 - - - 27.4 - 4.0 15.6 14.5 1.9 3.2 5.6
AR - 1.2 - - - - - 1.0 - - 5.0 - 4.0 29.9 25.9 34.3 10.4 9.7 1.2 3.7 5.1 6.5 6.2 - - 5.0 - 5.0
IA 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 9.1 2.0 - 5.3 12.1 1.5 25.3 58.2 84.1 51.5 28.4 5.0
VT - 6.6 8.0 4.5 7.4 7.2 1.3 3.8 - 5.3 13.0 1.8 4.5 4.2 - 46.46 4 11.6 1.2 0.5 4.5 34.8 24.1 17.6 42.2 47.1 33.1 24.8 4.4
ND - - 14.0 - - - - - - 0.2 9.8 - 1.1 0.5 3.03. 6.1 1.0 - 14.5 2.0 - - 0.2 5.5 4.7 3.2 4.0 2.4
HI - - - - - - - - - - - 20.5 1.5 4.2 12.8
12 203.0 37.8 4.4 17.8 13.7 14.6 32.8 4.9 7.5 7.4 9.5 0.6 0.6
PR - - - - - - 0.3 0.0 1.0 22.0 7.8 8.2 12.5 1.3 4.64. 42.1 32.0 0.5 0.1 1.5 28.8 14.3 16.0 13.8 - 4.5 - 0.1
AK - - - - - - - - - - - - - - - 3.5 - - - - - - - - - - - -
SD - - - - - - - - - - - - - - 0.7 0.3 1.6 18.1 3.5 2.2 - - 4.0 0.5 0.8 - 4.1 -
UN - - 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 14.3 - - - - - - - 0.5 - - -
WY - 0.1 - - - - - - - - - - 2.0 - - - - - - 1.5 4.1 6.5 0.2 1.5 - 10.0 - -
Total 2,776.4 3,124.5 3,363.6 3,406.0 3,319.6 2,822.4 2,254.0 3,586.3 3,656.8 4,145.7 8,012.6 11,341.5 14,974.9 21,498.9 54,900.3 105,200.0 40,968.3 22,132.0 19,681.1 23,235.1 23,612.5 27,617.2 31,875.1 29,925.9 20,378.3 23,315.7 29,497.2 26,652.4
Thomson Reuters 37
Figure 3.11b
Number of Venture Capital Deals by State 1985 to 2012
State 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 20012001 2002
2002 2003
2003 2004
2004 2005
2005 2006
2006 2007
2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012
CCA 467 494 523 534 568 552 478 573 436 462 685 1,023 1,140 1,400 2,221 2,949 1,537 1,102 1,159 1,249 1,338 1,591 1,727 1,687 1,284 1,461 1,602 1,532
MA 215 187 224 195 182 172 136 135 131 127 197 289 334 398 592 790 520 520 387
38 384 382 391 412 472 456 342 375 395 414
NY 45 46 63 48 49 31 24 38 37 38 73 89 156 196 353 611 294 156 120 159 132 233 218 261 205 296 345 331
PA 34 45 59 54 41 44 37 61 44 39 64 85 139 149 153 261 155 108 106 114 108 150 178 194 135 160 151 179
TX 106 93 106 105 91 85 70 70 71 69 101 135 172 197 318 484 341 34 173 173 177 181 201 188 161 123 165 167 159
WA 20 21 29 30 37 26 26 37 32 36 66 83 89 111 208 256 146 14 110 80 114 123 144 167 163 109 120 125 117
CO 43 58 62 63 53 49 35 53 48 53 58 83 98 127 162 222 115 91 74 72 93 110 114 116 94 86 107 100
IL 26 27 31 31 61 34 44 40 25 35 44 56 88 74 119 203 128 81 59 62 61 67 73 76 54 73 99 83
VA 22 22 31 26 30 27 24 20 20 21 39 59 82 99 154 285 145 92 86 79 91 95 102 89 50 58 76 80
OH 26 21 26 21 18 21 20 21 20 20 36 57 54 66 53 82 45 51 32 37 38 46 67 68 60 61 73 60
GA 31 44 45 41 31 33 36 37 42 46 49 54 79 98 161 224 138 81 65 79 64 91 75 80 46 70 60 54
MD 18 17 24 28 19 29 27 25 18 22 32 49 49 58 100 178 92 92 86 97 115 112 99 103 79 74 73 54
NJ 45 43 54 42 55 44 48 44 38 40 56 68 85 83 118 188 157 15 96 85 94 81 92 101 96 78 72 64 54
CT 33 33 41 46 48 41 36 33 26 35 43 45 65 73 96 123 78 41 38 38 34 30 36 42 42 62 56 52
MI 20 24 25 12 16 15 9 6 12 3 12 21 28 29 44 55 22 27 18 17 21 24 23 45 36 31 36 47
UT 3 14 15 7 6 4 9 8 7 1 6 16 31 35 43 58 4444 2929 24 31 32 43 37 38 34 27 49 44
FL 21 20 29 24 22 32 19 25 26 19 61 57 74 70 117 190 11311 64 66 66 54 60 60 45 37 46 57 35
NC 14 20 15 11 18 28 20 20 22 20 36 60 80 82 104 154 8888 8080 7676 56 47 59 69 55 39 58 49 35
TN 16 22 28 31 27 22 24 11 8 12 21 29 25 24 47 50 30 25 24 27 25 13 23 27 17 30 38 32
MN 23 31 34 29 30 32 31 26 24 20 50 47 89 77 84 107 87 58 57 52 43 45 61 51 39 30 48 29
OR 24 24 30 34 27 22 12 12 15 13 17 28 41 18 52 67 42 28 23 31 28 33 39 33 15 33 37 27
DC 4 5 8 4 2 5 3 3 2 4 1 5 2 4 18 45 22 7 6 8 11 9 14 14 8 16 11 26
IN 8 15 15 6 6 12 8 1 7 7 8 9 13 9 11 28 77 1212 8 10 13 14 17 14 15 17 14 17
AZ 15 11 20 13 24 14 15 22 21 25 27 30 29 38 57 70 35 27 19 12 28 34 34 22 20 16 22 15
NM 2 3 5 6 1 3 2 - 2 1 2 5 4 4 6 8 4 6 5 8 16 9 27 18 13 11 10 14
RI 6 4 7 6 7 7 4 2 3 - 3 2 4 5 11 11 11 14 10 8 12 7 3 6 15 11 14 14
WI 12 16 17 15 6 10 6 9 8 9 8 11 19 16 19 27 20 11 8 14 18 21 23 20 14 21 15 13
KS 1 2 6 3 3 3 1 3 2 2 4 11 6 3 8 22 10 8 13 13 5 10 16 25 17 36 46 10
MO 5 7 13 8 11 11 9 9 13 8 19 26 18 23 29 54 1818 29 19 9 11 14 18 25 12 15 22 9
NH 3 9 11 10 13 18 17 10 10 4 10 17 17 24 31 60 3939 41 34 22 21 19 25 28 14 10 13 8
DE 1 1 1 4 3 5 4 3 1 3 4 4 4 - 3 5 1 2 1 1 5 4 5 9 6 9 10 7
OK 4 5 4 1 4 2 1 - - 5 2 7 5 12 8 9 5 4 3 12 1 8 6 5 4 2 4 7
AL 7 10 12 4 7 7 2 4 10 4 9 8 17 14 10 30 15 13 10 8 5 9 8 10 11 2 2 6
KY 2 4 7 4 5 - 2 2 2 3 9 7 15 16 16 14 5 3 3 6 3 10 9 8 9 15 9 6
ME 8 6 5 4 6 6 4 1 2 - 2 5 2 14 11 15 9 6 3 4 3 7 8 4 4 7 5 6
MT 2 3 2 6 - - 3 - - - - - - - 2 3 2 - - - 2 1 1 2 1 3 2 6
ME 1 - - 5 1 - - - 5 3 1 5 3 5 7 11 10 3 2 2 3 4 4 4 - 4 1 5
SC 1 - 5 3 7 5 10 7 7 6 5 15 15 17 10 11 4 4 3 5 1 2 10 10 5 10 4 5
ID 1 - 1 - - - - 1 2 1 1 1 2 3 2 3 2 2 5 2 3 5 7 6 4 4 3 4
LA 6 2 2 2 - - 2 1 4 2 7 4 12 9 9 14 10 7 2 4 3 2 7 10 11 3 8 4
MS 1 1 - 1 1 3 1 4 2 5 - 3 4 3 5 6 3 3 3 5 2 4 1 - 4 - 1 4
NV - 2 2 - 1 1 4 4 - 2 2 4 7 11 10 10 6 6 7 7 8 7 8 6 4 5 3 4
VT - 3 3 3 2 3 3 1 - 3 5 3 3 3 1 4 3 4 3 3 4 8 7 8 8 7 8 4
HI 1 - - - - - - - - - - 3 4 3 3 3 5 2 7 5 6 11 6 7 3 3 3 3
WV 1 1 2 1 - 1 - - 1 - - - 2 1 - 2 2 8 5 3 5 4 5 2 3 4 2 3
AR - 1 - - - - - 1 - - 2 - 2 3 5 5 3 5 3 2 2 6 2 - - 1 - 1
IA 1 3 2 3 2 2 3 4 1 4 9 6 4 7 2 4 5 1 1 4 3 2 3 8 9 2 3 1
ND - - 1 - - - - - - 1 2 - 1 1 1 1 1 - 2 1 - - 1 4 3 1 1 1
PR - - - - - - 3 2 1 2 4 6 2 2 2 11 5 1 1 1 2 3 4 2 - 1 - 1
SD - - - - - - - - - - - - - - 1 1 2 2 1 4 - 1 3 1 3 - 2 1
AK - - - - - - - 1 - - - - - - - 1 - - - - - - - - - - - -
UN - - 1 2 3 1 1 2 4 2 2 7 7 14 3 16 8 - - - - - - - 1 1 1 -
WY - 1 - - - - - - - - - - 2 - - - - - - 1 4 1 2 1 - 1 - -
Total 1,345 1,421 1,646 1,526 1,544 1,462 1,273 1,392 1,212 1,237 1,894 2,637 3,223 3,728 5,600 8,041 4,589 3,203 3,022 3,217 3,300 3,887 4,213 4,165 3,139 3,626 3,946 3,723
38 Thomson Reuters
2013 NVCA Yearbook

Venture Capital Investments Venture Capital Investments
First vs. Follows-on Rounds Number of Companies Receiving
Total Dollars Invested ($ Millions)
7,000
120,000
6,000
Series2
Follow-on
100,000
Follow-on 5,000 Series1
First
(Number of Companies)
First
80,000
4,000
($ Millions)
60,000
3,000
40,000
2,000
20,000 1,000
0 0
'85
'88
'89
'90
'91
'95
'96
'97
'98
'99
'00
'01
'05
'08
'10
'11
'02
'03
'92
'87
'93
'85
'07
'88
'89
'90
'91
'95
'96
'97
'98
'99
'00
'01
'05
'08
'10
'11
'02
'03
'92
'87
'93
'07
'06
'09
'86
'04
'12
'94
'06
'09
'86
'04
'12
'94
Year Year

Venture Capital Investments Venture Capital Investments
First vs. Follows-on Rounds First vs. Follows-on Rounds
Total Dollars Invested ($ Millions) Total Number of Companies
No. of Cos No. of Cos
Year First Follow-on Total Receiving Receiving No. of Cos
Initial Deals Follow-On Receiving
1985 724.1 2,052.2 2,776.4 Year Financing Financing Financing*
1986 898.0 2,226.5 3,124.5 1985 433 756 1,153
1987 1,009.1 2,354.5 3,363.6 1986 506 759 1,226
1988 1,101.1 2,304.8 3,406.0 1987 580 865 1,387
1989 906.1 2,413.5 3,319.6 1988 513 800 1,264
1989 450 839 1,239
1990 835.9 1,986.4 2,822.4
1990 351 787 1,071
1991 552.0 1,702.0 2,254.0 1991 267 717 942
1992 1,284.4 2,301.9 3,586.3 1992 392 717 1,046
1993 1,273.7 2,383.1 3,656.8 1993 356 651 950
1994 1,652.6 2,493.1 4,145.7 1994 430 628 993
1995 3,976.7 4,035.9 8,012.6 1995 901 775 1,571
1996 1,146 1,171 2,118
1996 4,196.6 7,144.8 11,341.5
1997 1,304 1,473 2,575
1997 4,838.4 10,136.5 14,974.9 1998 1,431 1,830 3,030
1998 7,174.7 14,324.2 21,498.9 1999 2,470 2,442 4,477
1999 16,362.8 38,537.5 54,900.3 2000 3,394 3,691 6,425
2000 28,632.2 76,567.8 105,200.0 2001 1,236 2,782 3,855
2001 7,347.9 33,620.4 40,968.3 2002 851 1,972 2,712
2003 775 1,834 2,508
2002 4,321.1 17,810.9 22,132.0 2004 971 1,842 2,707
2003 3,703.9 15,977.2 19,681.1 2005 1,081 1,853 2,806
2004 5,444.5 17,790.6 23,235.1 2006 1,281 2,128 3,233
2005 5,955.0 17,657.5 23,612.5 2007 1,416 2,248 3,493
2006 6,329.9 21,287.4 27,617.2 2008 1,307 2,343 3,474
2009 830 1,896 2,638
2007 7,719.7 24,155.4 31,875.1
2010 1,088 2,040 3,006
2008 6,556.6 23,369.3 29,925.9 2011 1,317 2,158 3,308
2009 3,622.0 16,756.3 20,378.3 2012 1,174 2,117 3,143
2010 4,287.4 19,028.3 23,315.7 * No. of Cos receiving financing can be less than the sum of
2011 5,437.8 24,059.4 29,497.2 the prior two columns because a given company can receive
2012 4,177.4 22,475.0 26,652.4 initial and follow-on financing in the same year
Thomson Reuters 39
Figure 3.16
First Sequence by Stage of Development ($ Millions)
1985 to 2012
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SSeed 306.3 437.6 353.4 378.1 257.4 178.2 102.7 213.4 356.5 528.1 742.6 636.9 804.9 1,003.4 2,798.2 2,520.6 632.1 267.1 304.1 828.4 813.8 1,078.6 1,413.8 1,376.7 1,013.8 897.6 811.4 477.2
Early Stage 112.0 185.1 319.2 291.8 215.3 292.2 214.6 255.4 261.1 390.8 898.3 1,356.4 1,691.8 2,700.2 6,292.2 16,472.4 4,424.6 2,330.5 2,135.0 2,610.2 2,655.3 2,553.2 2,921.1 2,406.6 1,342.7 1,753.4 2,602.0 2,130.5
Expansion 266.8 211.7 274.1 324.3 320.0 278.9 157.6 572.5 488.1 493.1 1,644.4 1,742.4 1,866.5 2,835.0 5,960.4 8,715.9 1,925.8 1,339.1 950.4 1,294.3 1,563.0 1,908.1 2,479.8 1,703.8 790.2 913.9 1,038.8 923.8
LaterStage 39.1 63.6 62.4 106.9 113.4 86.7 77.1 243.1 168.0 240.5 691.5 460.9 475.2 636.1 1,311.9 923.3 365.4 384.4 314.5 711.6 922.9 790.0 905.0 1,069.5 475.3 722.5 985.5 645.8
Total 724.1 898.0 1,009.1 1,101.1 906.1 835.9 552.0 1,284.4 1,273.7 1,652.6 3,976.7 4,196.6 4,838.4 7,174.7 16,362.8 28,632.2 7,347.9 4,321.1 3,703.9 5,444.5 5,955.0 6,329.9 7,719.7 6,556.6 3,622.0 4,287.4 5,437.8 4,177.4
Figure 3.17
First Sequence by Stage of Development (No. of Deals)
1985 to 2012
Stage 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2 009 2 01 0 2 01 1 2 01 2
Seed 220 247 230 211 206 119 88 119 145 189 256 310 347 459 661 584 220 131 166 178 211 322 425 383 225 281 355 198
Early Stage 81 118 199 169 102 121 79 131 71 112 281 401 470 495 1118 1919 693 465 421 535 543 574 588 551 388 542 673 758
Expansion 108 106 119 107 113 88 80 115 106 107 294 360 419 412 629 800 280 202 142 183 251 273 299 229 142 166 173 138
Later Stage 24 35 32 26 29 23 20 27 34 22 70 75 68 65 62 91 43 53 46 75 76 112 104 144 75 99 116 80
Total 433 506 580 513 450 351 267 392 356 430 901 1,146 1,304 1,431 2,470 3,394 1,236 851 775 971 1,081 1,281 1,416 1,307 830 1,088 1,317 1,174
Figure 3.18
First Sequence by Industry ($ Millions)
1985 to 2012
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SSoftware 92.3 118.6 94.6 130.1 94.3 167.9 106.8 149.8 123.0 296.0 542.1 918.7 1,053.2 1,372.8 2,852.6 6,177.6 1,636.2 1,263.6 900.3 1,232.0 1,174.1 1,344.7 1,483.5 1,161.3 791.2 943.1 1,603.1 1,717.8
Media andEntertainment 69.8 43.5 100.3 114.1 80.4 63.7 13.9 81.3 195.6 115.3 775.1 363.8 392.7 688.4 2,458.4 2,874.8 344.6 208.5 219.2 731.5 566.2 637.8 648.3 504.0 249.8 442.1 591.8 459.0
Biotechnology 34.5 54.3 66.0 66.9 53.1 26.1 16.1 164.1 123.9 161.1 159.3 206.5 346.2 384.0 423.0 798.9 817.5 698.8 423.7 724.5 615.5 1,088.5 1,063.8 950.2 616.8 613.9 922.5 441.8
ITServices 20.8 9.6 5.5 12.8 20.6 18.3 10.3 8.9 36.0 93.0 44.9 220.8 236.1 377.1 1,549.1 2,621.8 291.6 133.1 163.3 198.8 335.0 347.0 483.0 631.8 326.2 380.9 468.9 303.0
Industrial/Energy 93.6 81.3 114.5 123.8 222.5 107.2 68.4 148.9 147.7 154.4 434.1 274.5 361.6 782.4 744.1 1,094.8 474.8 436.1 265.4 308.9 531.4 718.7 1,261.3 1,243.3 573.1 440.7 576.2 247.0
MedicalDevicesandEquipment 41.7 75.0 85.8 84.8 74.7 60.0 45.9 126.1 117.2 124.9 188.4 210.8 259.8 275.2 308.1 335.1 277.7 250.5 309.7 325.2 409.6 565.2 786.8 691.1 304.2 243.5 212.4 233.3
ConsumerProductsandServices 46.8 63.9 57.9 77.0 31.1 77.6 53.8 76.9 74.8 113.2 318.1 209.5 195.1 246.3 838.8 954.3 131.6 44.9 78.0 126.7 233.2 126.3 205.9 200.4 125.0 116.8 353.2 202.0
Telecommunications 64.5 45.0 38.6 33.4 44.2 53.6 10.8 93.5 64.6 192.8 365.2 417.5 387.1 955.6 1,968.5 4,756.8 808.4 189.5 179.5 284.2 343.8 395.9 421.2 318.8 89.4 173.3 82.3 141.3
Semiconductors 46.3 22.4 38.6 56.7 14.5 36.3 10.2 51.7 5.1 40.9 69.5 130.5 166.2 165.4 290.0 1,145.2 517.0 344.6 382.7 419.6 269.5 269.5 200.3 162.7 42.0 105.6 102.1 79.7
HealthcareServices 16.5 66.1 56.4 17.1 48.8 31.5 31.7 66.6 92.5 109.5 300.4 273.9 342.5 239.2 368.5 430.5 84.4 155.1 70.5 94.3 140.7 118.1 70.2 32.0 54.5 153.5 98.4 70.6
Electronics/Instrumentation 43.3 27.6 32.1 25.7 12.7 14.7 15.1 14.2 16.0 8.6 67.1 90.3 123.8 47.5 81.4 153.1 103.3 82.3 45.8 98.8 136.0 134.9 121.2 60.7 43.1 65.7 50.0 70.0
Other 0.5 2.0 6.0 0.0 32.7 0.0 - 0.2 12.0 0.5 16.1 26.8 92.3 37.0 36.6 17.0 - 13.6 - 15.8 - 3.6 2.0 15.5 52.7
Retailing/Distribution 19.7 57.0 137.8 63.3 22.4 13.2 25.1 52.7 28.4 60.5 217.7 131.0 114.2 355.3 667.1 872.8 59.1 34.7 12.4 118.3 135.9 39.9 84.5 55.1 22.5 81.6 79.0 46.8
ComputersandPeripherals 38.5 69.0 87.0 70.5 46.3 52.4 19.1 59.9 35.1 48.5 148.1 120.0 110.2 122.1 273.5 348.0 259.8 17.2 83.5 91.1 84.4 55.7 109.4 156.3 60.0 66.4 100.8 37.5
BusinessProductsandServices 12.3 48.7 26.6 11.3 13.3 37.7 63.7 28.1 61.9 33.6 125.2 243.0 255.3 367.0 990.7 1,921.7 277.1 120.3 342.6 235.9 162.7 189.3 262.2 98.5 118.7 153.0 63.1 27.4
NetworkingandEquipment 21.9 34.1 23.5 41.8 55.9 40.4 19.9 61.0 73.0 37.7 95.5 128.0 224.3 325.9 1,604.5 2,624.8 896.7 248.5 132.8 193.4 173.6 129.6 169.7 50.7 50.7 145.3 59.8 24.4
Financial Services 61.1 79.8 43.9 165.9 71.4 35.3 8.3 100.6 78.9 62.4 114.0 257.2 254.1 443.6 852.0 1,484.8 331.4 76.3 94.4 247.6 643.3 168.6 332.6 239.8 151.2 159.9 58.7 23.0
Total 724.1 898.0 1,009.1 1,101.1 906.1 835.9 552.0 1,284.4 1,273.7 1,652.6 3,976.7 4,196.6 4,838.4 7,174.7 16,362.8 28,632.2 7,347.9 4,321.1 3,703.9 5,444.5 5,955.0 6,329.9 7,719.7 6,556.6 3,622.0 4,287.4 5,437.8 4,177.4
40 Thomson Reuters
2013 NVCA Yearbook
Figure 3.19
First Sequence by Industry (No. of Deals)
1985 to 2012
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SSoftware 72 75 83 87 68 83 61 66 51 98 223 324 327 333 591 880 313 268 228 250 289 300 326 308 218 319 433 441
IT Services 12 8 6 9 11 7 5 5 8 20 28 66 63 90 230 327 73 27 34 51 63 91 100 120 79 99 137 109
Biotechnology 28 32 57 47 36 26 21 53 46 42 54 69 84 107 80 122 110 115 92 109 119 148 147 148 95 119 114 73
Other 1 1 1 2 2 2 1 1 5 1 6 5 10 9 8 2 1 3 2 9 3 6 9 12 25
Semiconductors 24 13 16 21 13 14 7 11 6 11 25 29 54 44 50 116 77 52 66 80 42 48 38 33 13 15 21 12
Total 433 506 580 513 450 351 267 392 356 430 901 1,146 1,304 1,431 2,470 3,394 1,236 851 775 971 1,081 1,281 1,416 1,307 830 1,088 1,317 1,174
Thomson Reuters 41

Internet-Related Investments Top Five States By Internet-Related Investments
By Year 1995-2012 in 2012
Year # Companies ($ Millions) State ($ Millions)

1995 427 1,931.0 California 8,783.7
1996 761 4,215.3 New York 1,665.3
1997 1,027 6,339.7 Massachusetts 1,288.3
1998 1,494 11,911.9 Washington 671.4
1999 3,068 42,567.5 Texas 470.2
2000 4,611 80,656.8 TOTAL* 12,878.8
2001 2,389 26,433.4
*Total includes above 5 states only
2002 1,468 11,358.8
2003 1,249 9,324.1
2004 1,270 10,897.8
2005 1,369 11,153.3
2006 1,678 13,136.8
2007 1,791 14,880.7
2008 1,844 13,332.5
2009 1,428 9,299.5
2010 1,703 11,047.0
2011 2,082 15,851.2
2012 2,050 15,676.0
TOTAL 13,982 310,013.3
Figure 3.22
2012 Internet-Related Investments
By Regions
Stage Region ($ Millions)
Silicon Valley 7,558.5
NY Metro 1,776.0
New England 1,338.4
LA/Orange County 950.0
Northwest 769.1
Midwest 652.5
DC/Metroplex 493.4
Texas 470.2
SouthWest 433.3
Southeast 409.6
San Diego 268.2
Colorado 233.8
Philadelphia Metro 147.0
North Central 109.8
South Central 40.1
Upstate NY 18.9
Sacramento/N.Cal 7.1
Alaska/Hawaii/Puerto Rico 0.1
TOTAL 15,676.0
42 Thomson Reuters
2013 NVCA Yearbook
Figure 3.23
Sources and Targets of Invested Capital Investments 2012
SOURCE Target State

STATE AK AL AR AZ CA CO CT DC DE FL GA HI IA ID IL IND KS
K KY LA MA MD ME MI MN MO MS
AL 0.0 7.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.1 4.2 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 0.0 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 0.0 0.0 0.0
AZ 0.0 0.0 0.0 0.0 3.6 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 21.3 0.0 0.0 0.0 0.0 0.0 0.0
CA 0.0 8.9 0.0 11.0 6,966.5 87.2 24.6 20.7 7.9 48.5 101.3 0.3 0.0 0.0 134.9 4.3 8.0 2.5 2.3 718.7 122.4 3.8 28.9 81.5 0.0 0.0
CO 0.0 0.0 0.0 0.0 56.4 83.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 14.7 0.0 0.0 0.0 0.0 9.8 7.8 0.0 0.0 0.0 0.0 0.0
CT 0.0 0.0 0.0 4.6 281.7 21.7 26.6 0.0 0.0 2.4 7.7 0.0 0.0 0.0 2.6 0.0 0.0 0.2 0.0 58.0 5.1 0.0 52.4 6.0 0.0 0.0
DC 0.0 0.0 0.0 0.0 18.3 1.4 0.0 2.2 0.0 0.0 4.8 0.0 0.0 0.0 5.1 0.0 0.0 0.2 0.0 6.8 0.4 0.0 0.0 0.4 0.0 0.0
DE 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 0.0 0.0 0.0 0.0 0.0 0.0 0.0
FF 0.0 1.1 0.0 20.5 1,191.8 80.1 27.5 0.0 0.0 21.6 6.6 0.0 0.0 0.0 146.9 0.0 0.6 0.0 0.0 308.6 19.4 0.0 26.2 52.0 0.0 0.0
FL 0.0 0.0 0.0 0.0 29.2 0.0 0.0 0.0 0.0 6.3 3.4 0.0 0.0 0.0 0.0 3.5 0.0 0.0 0.0 6.0 0.0 0.0 0.0 0.0 0.0 0.0
GA 0.0 2.6 0.8 0.0 18.4 6.7 0.0 0.0 0.0 1.8 28.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.0 1.3 0.0 0.0 2.0 0.0 1.0
HI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 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 0.0 0.0 0.0
ID 0.0 0.0 0.0 0.0 2.0 5.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
IL 0.0 0.0 0.0 50.0 257.2 18.3 0.0 0.0 0.0 7.5 5.6 0.0 0.0 0.0 84.5 0.1 0.0 0.0 0.0 25.2 4.3 0.0 13.8 0.0 0.0 0.0
IN 0.0 0.0 0.1 0.0 10.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 17.0 0.0 0.0 0.0 8.9 0.3 0.0 0.0 0.6 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 0.4 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 1.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.4 3.1 0.0 1.9 0.0 0.0 1.6
LA 0.0 0.0 0.0 0.0 0.0 0.0 2.9 1.0 0.3 1.3 0.2 0.0 0.0 0.0 1.3 0.0 0.0 19.8 0.3 1.0 0.0 0.0 0.0 0.0 0.0 1.0
MA 0.0 0.0 0.0 6.3 1218.6 24.7 8.0 0.0 0.0 7.2 5.0 0.0 1.0 12.5 40.2 0.0 3.5 0.2 4.6 903.0 16.0 5.0 8.3 7.5 0.0 0.0
MD 0.0 0.0 0.0 46.0 49.4 13.8 0.4 7.3 0.0 6.3 5.7 0.0 0.0 0.0 2.5 0.0 0.0 0.0 0.0 10.5 13.4 0.0 0.0 0.0 0.0 0.0
ME 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 11.0 0.0 1.3 0.0 0.0 0.0 0.0
MI 0.0 0.0 0.0 0.0 142.3 0.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 20.0 3.0 0.0 0.0 0.1 0.1 0.0 0.0 34.4 7.6 0.0 0.0
MN 0.0 0.0 0.0 2.5 50.6 0.0 0.0 0.0 0.0 8.2 0.0 0.0 0.0 0.0 0.0 0.0 2.0 0.0 0.0 11.3 0.0 0.0 0.0 50.0 0.0 0.0
MO 0.0 0.0 0.0 0.0 55.5 0.0 0.0 0.0 0.0 2.4 0.0 0.0 0.0 0.0 0.0 0.0 0.3 0.0 0.0 9.5 0.0 0.0 0.0 0.0 7.8 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 0.0 0.0 0.0
NC 0.0 0.0 0.0 0.0 34.1 0.0 0.0 0.0 0.0 5.7 2.0 0.0 0.0 0.0 0.0 10.0 0.0 0.0 0.0 2.6 9.8 0.0 3.7 0.0 0.0 0.0
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 0.0 0.0 0.0
NE 0.0 0.0 0.0 0.0 0.0 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 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 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.9 0.0 0.5 0.0 0.0 0.0 0.0
NJ 0.0 0.0 0.0 1.0 144.0 0.4 1.9 0.0 0.3 0.0 2.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 47.2 3.1 0.0 0.0 6.5 0.0 0.0
NM 0.0 0.0 0.0 0.0 0.0 0.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 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 0.1 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 2.7 0.0 0.0 0.0 0.0 0.0 0.0
NY 0.0 1.1 0.0 32.2 1029.8 31.6 17.9 3.2 0.1 31.3 17.3 0.0 2.0 0.0 19.6 0.0 8.5 0.0 2.3 210.1 22.1 0.0 10.8 4.7 0.0 0.0
OH 0.0 0.0 0.0 0.0 6.8 0.0 2.4 0.0 0.2 2.3 0.0 0.0 0.0 0.0 5.9 6.2 0.0 0.0 0.0 9.0 0.0 0.0 4.0 0.0 0.0 0.0
OK 0.0 0.0 0.0 0.0 2.1 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
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 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
PA 0.0 0.0 0.0 3.8 104.5 0.9 2.5 7.9 0.3 19.6 3.9 0.0 1.0 0.0 6.9 25.0 0.0 0.0 0.0 25.6 3.8 0.0 0.0 0.3 0.0 0.0
PR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 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 0.0 0.0 17.0 0.0 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 0.0 0.0 0.0
SD 0.0 0.0 0.0 0.0 1.4 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 1.5 0.0 0.0 0.0 5.2 0.0 0.0
TN 0.0 0.0 0.0 2.5 8.1 0.0 0.0 0.0 0.0 0.0 2.1 0.0 0.0 0.0 10.0 0.0 0.0 0.1 0.0 3.0 0.0 0.0 0.0 1.8 0.0 1.4
TX 0.0 0.0 0.0 16.9 51.7 2.5 0.0 0.0 0.0 0.0 18.1 0.0 0.0 0.0 0.3 0.0 0.0 0.0 0.0 13.4 0.0 0.0 0.3 0.0 8.7 1.4
UN 0.0 2.2 4.1 14.0 2227.9 166.8 41.7 17.8 0.0 28.5 45.1 0.3 1.0 2.2 65.8 15.0 22.2 0.0 1.0 565.5 33.5 2.2 41.9 16.3 4.8 3.4
UT 0.0 0.0 0.0 0.5 21.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.7 0.0 0.0 0.0 0.0 12.0 1.1 0.0 0.0 0.0 0.0 0.0
VA 0.0 0.0 0.0 0.0 46.1 4.1 0.0 0.8 0.0 0.0 1.8 0.0 0.0 0.0 7.5 0.0 0.1 0.0 0.0 10.4 9.6 0.0 0.0 0.0 0.0 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 0.0 0.0 0.0
WA 0.0 0.0 0.0 0.0 93.6 10.0 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 25.3 2.4 0.0 1.4 0.0 0.0 0.0
WI 0.0 0.0 0.0 0.0 5.5 2.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.2 0.0 0.0 0.0 0.0 2.7 0.0 0.0 4.2 0.0 0.0 0.0
Total 0.0 23.2 5.0 211.8 14,129.0 564.1 157.6 61.0 9.5 203.0 264.9 0.6 5.0 15.2 570.6 84.1 46.3 23.0 10.6 3,068.0 279.4 12.8 232.2 242.4 21.3 9.8
Source State includes U.S. states. FF = other foreign UN = undisclosed or unknown.
Thomson Reuters 43
Target State
Figure 3.23 (continued)

Sources and Targets of Invested Capital Investments 2012
SOURCE Target State

STATE MT NC ND NE NH NJ NM NV NY OH OK ORE PA PR RI SC SD TN TX UN UT VA VI VT WA WI WV WY TOT
AL 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 0.0 1.0 0.0 0.0 1.0 0.0 0.0 4.1 0.0 0.0 0.0 0.0 0.0 0.0 23
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 0.0 0.0 0.0 0.0 0.0 0
AZ 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 1.9 0.0 0.0 0.0 0.2 0.0 0.0 0.0 27
CA 1.0 27.3 0.0 7.5 18.2 62.9 3.4 4.8 422.7 76.1 0.0 46.5 128.7 0.0 19.8 11.3 0.0 16.3 151.8 0.0 172.5 24.2 0.0 0.0 235.5 29.6 0.0 0.0 9,844
CO 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.0 8.4 0.0 0.0 6.6 3.8 0.0 0.0 0.0 0.0 0.0 11.3 0.0 0.0 6.7 0.0 0.0 37.9 0.0 0.0 0.0 247
CT 0.0 5.9 0.0 0.0 0.0 20.4 1.2 0.0 42.8 27.2 0.0 0.0 10.4 0.0 2.8 0.0 0.0 0.0 6.0 0.0 0.2 0.0 0.0 0.0 21.1 0.0 0.0 0.0 607
DC 0.0 1.2 0.0 0.0 0.0 0.7 0.0 0.0 5.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.3 0.0 0.0 27.8 0.0 0.0 0.8 0.0 0.0 0.0 77
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 2.7 0.0 0.0 0.0 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
FF 0.0 34.3 0.0 0.0 0.0 70.4 0.0 1.0 136.1 17.6 0.0 10.2 35.0 0.0 8.8 6.6 0.0 0.0 67.9 0.0 0.8 12.4 0.0 1.0 57.6 0.5 0.0 0.0 2,363
FL 0.0 0.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.9 0.0 5.8 5.2 0.0 0.0 0.0 0.0 0.0 14.5 0.0 0.0 0.0 0.0 0.0 3.0 3.8 0.0 0.0 83
GA 0.0 0.9 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 2.2 0.0 5.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 80
HI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 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 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 0.0 0.0 0.0 0.0 0.0 8
IL 0.0 7.0 0.0 0.0 0.0 15.6 0.0 0.0 8.4 2.2 0.0 0.0 5.5 0.0 0.0 0.0 0.0 8.5 14.2 0.0 0.0 38.0 0.0 0.0 32.5 22.3 0.0 0.0 621
IN 0.0 0.8 0.0 0.0 0.0 0.7 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 0.0 0.0 0.0 41
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 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 0.4 3.8 0.0 0.0 0.8 0.0 0.0 0.0 0.0 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.3 0.0 0.0 15
LA 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.8 0.0 0.0 0.0 0.6 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 35
MA 0.5 6.8 0.0 0.0 12.2 23.3 1.0 0.0 256.9 15.4 13.7 2.3 54.9 0.0 19.3 5.8 0.0 1.8 102.1 0.0 15.9 18.5 0.0 0.0 53.7 0.0 0.0 0.0 2,875
MD 0.0 2.2 0.0 0.0 0.0 0.3 0.0 0.0 26.5 1.4 0.0 0.0 0.9 0.0 0.0 0.0 0.0 0.0 2.5 0.0 2.5 13.4 0.0 0.0 1.5 0.0 0.0 0.0 206
ME 0.0 0.0 0.0 0.0 4.4 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 1.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 18
MI 0.0 0.0 0.0 0.0 0.0 4.4 0.0 0.0 0.8 1.8 0.0 4.6 3.2 0.0 0.0 3.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 7.7 1.8 0.0 0.0 236
MN 0.0 0.0 0.0 0.0 0.0 0.5 0.0 0.0 0.0 1.7 0.0 4.6 3.0 0.0 0.0 0.0 0.0 5.0 0.0 0.0 0.0 0.0 0.0 0.0 2.3 0.0 0.0 0.0 142
MO 0.0 2.9 0.0 0.0 0.0 0.0 0.0 0.0 1.1 0.9 0.0 2.7 1.8 0.0 0.0 0.0 0.0 0.0 1.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 86
MT 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 0.0 0.0 0.0 0.0 0.0 0
NC 0.0 42.6 0.0 0.0 0.6 8.4 0.0 0.0 6.0 0.0 0.0 0.0 3.1 0.0 6.3 2.8 0.0 6.4 1.5 0.0 0.0 0.9 0.0 0.0 0.0 0.0 0.0 0.0 147
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 0.0 0.0 0.0 0.0 0.0 0
NE 0.0 0.0 0.0 2.2 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 0.0 0.0 3
NH 0.0 0.0 0.0 0.0 1.1 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 0.0 6
NJ 0.0 0.0 0.0 0.0 5.0 27.5 0.0 0.0 16.5 6.5 0.0 0.0 4.3 0.0 0.0 0.0 0.0 0.0 0.7 0.0 6.0 0.2 0.0 0.0 13.7 0.0 0.0 0.0 287
NM 0.7 0.0 0.0 0.0 0.0 0.0 7.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 8
NV 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.6 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 0.0 0.0 0.0 0.0 0.0 3
NY 0.0 16.9 0.0 0.0 0.0 39.0 0.8 0.0 440.5 17.8 0.0 4.6 15.9 0.0 2.8 0.0 0.0 0.0 183.2 0.0 34.4 7.5 0.0 0.0 59.9 0.0 0.0 0.0 2,268
OH 0.0 1.2 0.0 0.0 0.0 0.0 3.1 0.0 15.3 40.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 99
OK 0.0 0.0 0.0 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 5.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 8
OR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3.7 0.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.1 0.0 0.0 0.0 5
PA 0.0 4.8 0.0 0.0 0.0 14.1 0.0 0.0 86.3 9.9 0.0 0.0 95.9 0.0 10.5 0.0 0.0 0.0 17.4 0.0 0.0 8.4 0.0 0.0 27.9 8.8 0.3 0.0 490
PR 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 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 5.2 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 22
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 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 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 9
TN 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.7 0.0 0.0 0.2 0.0 0.0 0.0 0.0 23.6 5.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 60
TX 0.0 0.5 0.0 0.0 0.0 0.3 1.6 0.0 0.0 7.5 1.0 0.0 0.0 0.1 0.0 0.0 0.0 0.0 150.5 0.0 1.5 1.1 0.0 0.0 30.2 0.0 0.0 0.0 307
UN 3.2 9.0 2.4 1.0 19.1 120.8 13.6 1.3 333.7 38.2 18.5 20.8 136.3 0.0 5.9 6.6 0.0 18.3 182.7 0.0 10.5 59.7 0.0 2.9 156.4 17.4 10.7 0.0 4,512
UT 0.0 0.0 0.0 0.0 0.0 0.0 3.3 0.0 11.3 0.0 0.0 5.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 45.8 0.0 0.0 0.0 0.8 0.0 0.0 0.0 102
VA 0.0 1.7 0.0 0.0 0.0 0.0 0.0 0.0 14.0 0.0 0.0 0.0 5.3 0.0 0.0 0.0 0.0 0.6 0.8 0.0 12.5 149.4 0.0 0.0 13.3 0.0 3.6 0.0 281
VVT 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 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 0.0 1
WA 0.0 0.0 0.0 0.0 0.0 19.8 0.0 0.0 17.4 7.0 0.0 6.4 0.0 0.0 3.5 0.0 0.0 0.0 6.1 0.0 0.0 0.0 0.0 0.0 174.1 0.0 0.0 0.0 367
WI 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 4.3 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 0.5 9.8 0.0 0.0 30
Total 5.6 169.2 2.4 10.7 60.6 429.3 35.1 7.1 1,856.8 285.8 34.0 123.8 518.0 0.1 84.9 39.6 0.0 87.1 930.4 0.0 304.5 372.3 0.0 4.4 931.7 95.3 14.6 0.0 26,653
Source State includes U.S. states. FF = other foreign. UN = undisclosed or unknown.
44 Thomson Reuters
2013 NVCA Yearbook

2012 Internet-Related Investments 2012 Internet-Related Investments
By Stage By Industry Sector
Company Stage ($ Millions) Industry Group ($ Millions)
Software 7,956.7
Seed 243.0 IT Services 1,976.7
Early Stage 4,297.2 Media and Entertainment 1,894.8
Expansion 7,089.7 Consumer Products and Services 1,093.0
Later Stage 4,046.1 Telecommunications 574.4
TOTAL 15,676.0 Retailing/Distribution 486.7
Computers and Peripherals 355.2
Semiconductors 353.0
Networking and Equipment 315.0
Financial Services 211.7
Medical Devices and Equipment 146.8
Healthcare Services 140.1
Business Products and Services 74.1
Industrial/Energy 48.9
Biotechnology 29.5
Electronics/Instrumentation 19.4
TOTAL 15,676.0
Figure 3.26
2012 Internet-Related vs Non Internet-Related
Investments By Industry Sector ($ Millions)
Industry Internet Related Non-Internet Related Total
Software 7,956.7 336.8 8,293.5
IT Services 1,976.7 16.6 1,993.3
Media and Entertainment 1,894.8 81.4 1,976.2
Consumer Products and Services 1,093.0 115.1 1,208.1
Telecommunications 574.4 7.6 581.9
Retailing/Distribution 486.7 11.6 498.2
Computers and Peripherals 355.2 97.8 453.0
Semiconductors 353.0 573.4 926.4
Networking and Equipment 315.0 0.9 315.9
Financial Services 211.7 72.1 283.8
Medical Devices and Equipment 146.8 2,364.7 2,511.5
Healthcare Services 140.1 169.4 309.5
Business Products and Services 74.1 23.3 97.5
Industrial/Energy 48.9 2,743.5 2,792.4
Biotechnology 29.5 4,085.2 4,114.8
Electronics/Instrumentation 19.4 224.4 243.8
Other 0.0 52.7 52.7
Total 15,676.0 10,976.4 26,652.4
Thomson Reuters 45
Figure 3.27
2012 Internet-Related vs Non Internet-Related
Investments By Industry Sector (Number of Companies)
Industry Internet Related Non-Internet Related Total
Software 1,038 58 1,096
Media and Entertainment 323 11 334
IT Services 281 5 286
Consumer Products and Services 114 28 142
Telecommunications 83 4 87
Retailing/Distribution 46 3 49
Networking and Equipment 32 2 34
Financial Services 24 16 40
Computers and Peripherals 23 10 33
Semiconductors 19 66 85
Business Products and Services 17 16 33
Industrial/Energy 14 182 196
Medical Devices and Equipment 14 243 257
Healthcare Services 11 29 40
Biotechnology 6 353 359
Electronics/Instrumentation 5 41 46
Other 0 26 26
Total 2,050 1,093 3,143

Top Five States By Percentage Invested Top Five States By Portion Received From
Within State in 2012 In-State Firms 2012
Pct. Invested Pct. Invested

Fund Domicile Within State Company Location From State
California 71% California 49%
Virginia 53% Virginia 40%
Texas 49% Missouri 37%
Washington 47% Alabama 31%
Utah 45% Massachusetts 29%
*Minimum $20 million invested *Minimum $20 million invested

Number of States Invested Into in 2012 Number of States California Venture Firms
By State of Venture Firm Invested Into By Year
Location of No. of States No. of States
Venture Firm Invested In Year Invested In
California 39 1992 30
Massachusetts 33 2002 34
New York 32 2012 39
Pennsylvania 26
Connecticut 23
Illinois 20
Maryland 19
Texas 19
New Jersey 18
Virginia 17
North Carolina 17
Michigan 17
46 Thomson Reuters
2013 NVCA Yearbook
Figure 3.32
Corporate Investments By Year
Calculated
Percentage of Deals $M Average Calculated
# All Venture # Deals with CVC with Corporate VC Amount of All VC $M Average Amount Total VC Total CVC Percentage of Dollars
Year Capital Deals Involvement Involvement Deals of CVC Participation Investment $M Investment $M Coming from CVCs
1995 1,894 145 7.7% $4.23 $3.01 8,013 436 5.4%
1996 2,637 224 8.5% $4.30 $3.03 11,341 679 6.0%
1997 3,223 346 10.7% $4.65 $2.73 14,975 946 6.3%
1998 3,728 501 13.4% $5.77 $3.44 21,499 1,722 8.0%
1999 5,600 1190 21.3% $9.80 $6.25 54,900 7,436 13.5%
2000 8,041 1963 24.4% $13.08 $7.64 105,200 15,003 14.3%
2001 4,589 964 21.0% $8.93 $4.76 40,968 4,588 11.2%
2002 3,203 546 17.0% $6.91 $3.49 22,132 1,907 8.6%
2003 3,022 434 14.4% $6.51 $2.94 19,681 1,277 6.5%
2004 3,217 533 16.6% $7.22 $2.88 23,235 1,535 6.6%
2005 3,300 544 16.5% $7.16 $2.81 23,612 1,527 6.5%
2006 3,887 789 20.3% $7.11 $3.22 27,617 2,542 9.2%
2007 4,213 793 18.8% $7.57 $3.23 31,875 2,558 8.0%
2008 4,165 878 21.1% $7.19 $3.04 29,926 2,670 8.9%
2009 3,139 394 12.6% $6.49 $3.35 20,378 1,319 6.5%
2010 3,626 452 12.5% $6.43 $4.15 23,316 1,877 8.0%
2011 3,946 557 14.1% $7.48 $3.97 29,497 2,211 7.5%
2012 3,723 565 15.2% $7.16 $3.86 26,652 2,178 8.2%
Figure 3.34
Figure 3.33 California Investments as a Percentage of
Clean technology Investments By Year Overall Investments
100%
Average
90%
Clean Technology Investment Per
Investments # Clean Technology Deal 80%
Year ($ Millions) Deals ($ Millions) 51.7% 47.0%
56.7% Other
1995 77.0 35 2.2 70% 59.6%
1996 163.0 47 3.5 SoCal
60%
1997 180.4 52 3.5 NoCal
1998 183.9 42 4.4 50%
12.0%
1999 310.4 56 5.5 11.8%
40% 10.3%
2000 629.1 53 11.9 9.3%
2001 404.2 63 6.4 30%
2002 346.8 50 6.9
20% 36.0% 41.0%
2003 229.0 58 3.9 31.1% 33.0%
2004 431.1 82 5.3 10%
2005 630.9 98 6.4
2006 1,800.8 153 11.8 0%
2007 3,116.2 267 11.7 1997 2002 2007 2012
2008 4,271.3 313 13.6
2009 2,523.7 248 10.2
2010 4,085.3 317 12.9
2011 4,549.3 349 13.0
2012 3,303.1 267 12.4
Thomson Reuters 47
48 Thomson Reuters
Exits: IPOs and Acquisitions
Once successful portfolio companies mature, venture funds generally exit their positions in those companies by tak-
ing them public through an initial public offering (IPO) or by selling them to presumably larger organizations (acqui-
sition, or trade sale). This then lets the venture fund distribute 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.
IPOs in 2012 were a mixed bag at best. On the one hand, the number of venture-backed companies going public
actually fell from 2011 from 51 to 49. But the dollars raised in those initial public offerings more than doubled from
$10.7 billion to $21.5 billion. But looking behind the numbers, we see that Facebook itself raised $16.0 billion of
that $21.5 billion, with a few other high-profile IPOs looming large in the remainder. This meant that many compa-
nies attempting or seeking to go public were not able to do so.
The 49 venture-backed IPOs in 2012 are a far cry from the 280 IPOs in 1999. While no one is suggesting that the
industry would be well-served by returning to the heady days of the bubble, we know that only 49 IPOs means many
companies that would have gone public in more traditional times were frustrated in their efforts/attempts to go pub-
lic. The venture industry typically invests in 1,000-1,400 new companies each year. In the 1990s, 14% of all first
fundings went public. Even if just 10% go public these days, that would suggest an annual run rate of 100 to 140
companies — a far cry from 49.
On the market valuation placed on these IPOs at the offer price, 2012 was a very good year. The 49 IPOs had a val-
uation of $122.3 billion. This is the highest amount since 1986. What is quite striking (Fig 5.03), is the huge gap
between median and mean (average) valuation of almost seven times! This suggests a huge outlier effect created by
the several large IPOs. In 2012, the provision in the JOBS act took effect which enabled companies to file the doc-
uments necessary to go public confidentially. It appears that the majority of companies are electing this option, so
it is difficult to report on the IPO pipeline at year end 2012.
Nine venture-backed companies went public with an IPO valuation of $1 billion or greater. The bulk of the IPO val-
uations were in the $100 million to $500 million range.
The length of time it takes for a company to go public remains at historically high levels. Those few that were able
Figure 4.01 Venture-Backed IPOs

300 30.00
No of IPOs
250 Offer Amount ($B) 25.00
200 20.00
Offer ($ Billion)
No. of IPOs
150 15.00
100 10.00
50 5.00
0 0.00
'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
Year
Thomson Reuters 49
to go public had a median age of seven years. Many companies awaiting their turn to go public are older than that,
so as IPO markets reopen, we could see this statistic increase.
In 2012, the acquisition market weakened. There was a slight decrease in the number of acquisitions, or trade sales, of
venture-backed companies. We tracked 449 acquisitions, of which we had disclosed deal amounts for 121 of them. The sum
of the disclosed values was also down at $21.5 billion. Just over one-fifth of them were acquired at 10 times or greater
than the cumulative venture capital investment in those companies. We tracked four acquisitions at more than $1 billion.
Methodology
backed exits coverage includes full history for the
This chapter focuses on company exits by venture U.S. and Canada as well as Global Exits from 2005
funds through IPO and through acquisition (trade to the present. Multiple exits per company are now
sale, M&A). Some additional charts are provided on tracked, including IPOs (although secondary offer-
private equity backed acquisitions because of the ings are not tracked, since first IPO is considered the
venture industry’s interest in that data. With Thomson exit), Secondary Sales (sponsor to sponsor), Trade
Reuters’ expansion of global deals coverage in 2012, Sales (VC (PE) Firm to Non-PE Firm), Buybacks,
the criteria used to report these exits were redefined Reverse Takeovers and Writeoffs. All values are
and refined during 2012. These are explained below. sourced from the industry leading Thomson Reuters
Deals database with hyperlinks to the Tearsheets to
In this chapter and throughout this Yearbook, we use view the underlying details of the transactions. The
the classic nomenclature for describing the two main PE Backed Exits component in ThomsonONE.com
types of private equity: can be used to further analyze all of the VC and PE
Private Equity = Venture Capital + Exits content herein.
Buyout/Mezzanine
Therefore charts describing Private Equity in this Specifically, venture capital IPO exits reported in this
chapter and throughout this Yearbook include both chapter are those done on United States stock
buyout/mezzanine activity and venture capital activi- exchanges/markets with at least one United States
ty. domiciled venture fund investor.
The Thomson Reuters venture capital (private equity) Specifically, venture capital (private equity) acquisi-
Figure 4.02 Number of Venture-Backed IPOs

vs. All IPOs
# of Venture-
Year # of All IPOs
Backed IPOs
2000 347 238
2001 81 37
2002 76 24
2003 67 26
2004 188 82
2005 168 59
2006 167 68
2007 162 92
2008 24 7
2009 39 13
2010 104 68
2011 99 51
2012 113 49
Note: IPO counts reflect IPOs on U.S. stock
exchanges and markets. Venture-backed IPOs
are those with at least one U.S.-domiciled
venture fund investor.
50 Thomson Reuters
2013 NVCA Yearbook
tion exits reported in this chapter are secondary sales

and trade sales that completed where the company
was domiciled in the United States and had at least
one United States domiciled venture capital (private
equity) investor.
Figure 4.03
Venture-Backed IPOs 1985 to 2012
Value and Time to Exit Characteristics
Offer
Num of Amount Med Offer Mean Offer Post Offer Med Post Mean Post Median Time Mean Time
Year IPOs ($Mil) Amt ($Mil) Amt ($Mil) Value ($Mil) Value ($Mil) Value ($Mil) to Exit (yrs) to Exit (yrs)
1985 48 763 13 16 1,991 32 47 2.8 3.9
1986 104 2,414 14 23 166,260 53 1,889 3.9 4.2
1987 86 2,125 17 25 10,790 46 150 3.7 3.9
1988 43 769 15 18 20,523 51 555 3.2 3.7
1989 42 873 16 21 5,479 51 166 3.9 4.2
1990 47 1,108 20 24 5,886 60 178 3.6 4.2
1991 120 3,726 27 31 14,151 78 168 4.7 5.0
1992 150 5,431 24 36 15,759 68 147 4.5 5.0
1993 175 6,141 24 35 14,430 75 129 5.4 5.8
1994 140 4,004 24 29 9,854 67 91 4.7 5.3
1995 184 7,859 36 43 17,046 103 136 3.8 4.8
1996 256 12,666 35 49 40,360 111 191 3.2 4.1
1997 141 5,831 33 41 17,784 99 146 3.0 6.4
1998 79 4,221 43 53 9,649 149 214 2.5 3.1
1999 280 24,005 70 86 86,669 294 425 2.9 3.1
2000 238 27,443 83 115 63,610 336 464 3.1 3.7
2001 37 4,130 80 112 15,545 304 576 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 68 7,127 85 105 71,467 293 1,067 5.4 5.6
2007 92 12,365 97 134 68,282 361 742 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 68 7,609 93 112 111,386 431 1,662 5.0 5.9
2011 51 10,690 106 210 94,987 606 1,862 6.3 7.0
2012 49 21,451 89 438 122,264 371 2,495 7.2 7.8
Thomson Reuters 51
Figure 4.04
Venture-Backed IPOs by MoneyTree™ Industry
Total Offering Size ($ Millions)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
MMedia and Entertainment 51 599 22 3 17 10 103 253 710 562 207 659 505 199 2,995 1,243 0 353 75 1,422 376 864 209 0 0 731 2,210 16,236
Software 52 270 206 161 135 192 476 409 846 447 2,366 1,869 912 953 5,243 4,924 405 259 330 2,466 570 768 1,471 344 604 1,178 3,310 2,022
Biotechnology 38 349 217 26 51 66 964 848 473 296 437 1,250 590 197 587 4,211 353 342 442 1,616 897 957 1,318 6 153 1,070 997 854
IT Services 15 4 32 0 0 0 163 48 41 68 308 396 151 239 2,146 2,030 0 0 0 49 140 207 836 0 0 379 353 636
Networking and Equipment 25 105 136 42 43 82 346 284 233 457 313 749 416 235 3,050 4,339 275 0 0 69 0 479 313 0 0 267 0 316
Telecommunications 27 89 421 79 30 141 22 212 766 277 492 1,498 379 881 4,720 5,304 173 0 175 594 651 731 1,591 0 402 197 805 305
Industrial/Energy 29 58 177 75 127 242 346 325 670 450 495 1,064 778 138 207 1,107 747 0 0 638 299 1,114 1,007 0 88 1,040 984 247
Financial Services 0 91 46 10 47 0 21 1,248 51 237 273 1,597 209 45 521 50 771 231 353 1,447 706 551 1,178 0 0 558 0 176
Business Products and Services 58 33 0 2 0 44 66 70 193 70 35 496 185 58 1,068 594 0 248 62 0 507 0 1,202 0 0 190 322 152
Semiconductors 15 47 368 79 62 29 210 86 311 164 696 0 319 37 221 1,052 133 0 381 522 472 136 975 0 0 534 255 130
Medical Devices and Equipment 61 89 147 22 71 90 241 601 266 388 995 1,666 444 98 0 634 673 456 0 806 380 633 1,407 134 0 299 145 115
OOther 0 54 0 0 0 0 0 12 0 0 0 0 203 0 101 177 100 0 0 0 0 0 0 0 0 0 0 0
RRetailing/Distribution 154 67 48 146 35 18 29 265 718 71 111 358 159 344 1,736 459 26 259 65 0 28 144 452 0 0 178 0 0
TTotal 763 2,414 2,125 769 873 1,108 3,726 5,431 6,141 4,004 7,859 12,666 5,831 4,221 24,005 27,443 4,130 2,333 2,024 10,032 5,113 7,127 12,365 765 1,980 7,609 10,690 21,451
Figure 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 2000 2001 2002
2002 2003
2003 2004
2004 2005
2005 2006
2006 2007
2007 2008
2008 2009
2009 2010
2010 2011
2011 2012
2012
BBiotechnology 5 16 14 2 6 4 31 27 21 14 16 33 22 7 9 47 4 4 7 26 15 17 21 1 2 12 11 12
Software 3 15 10 8 8 9 14 13 26 19 56 54 26 21 75 58 5 5 4 9 6 7 13 2 5 10 9 9
IIT Services 1 1 3 0 0 0 5 1 1 3 5 9 4 5 29 16 0 0 0 1 1 2 6 0 0 4 3 6
MMedia and Entertainment 4 10 2 1 1 2 3 7 10 9 4 12 7 3 34 11 0 4 1 6 4 6 2 0 0 5 8 4
CConsumer Products and Services 1 5 1 1 3 1 6 7 4 2 9 7 6 7 9 3 3 11 22 33 11 44 11 00 11 55 22 33
IIndustrial/Energy 3 5 13 6 4 6 10 9 19 15 11 18 17 3 3 7 4 00 00 33 33 77 55 00 11 66 33 33
NNetworking and Equipment 1 2 5 2 2 2 8 11 6 13 10 10 6 5 26 17 2 0 0 1 0 4 3 0 0 3 0 3
TTelecommunications 6 6 6 2 1 4 1 7 14 10 8 18 7 9 37 33 1 0 2 6 6 3 9 0 2 3 5 3
FFinancial Services 0 3 3 1 3 0 1 6 2 8 5 10 4 2 7 1 2 22 44 77 22 44 33 00 00 55 00 22
SSemiconductors 1 4 5 5 3 1 9 4 13 9 16 0 8 1 4 10 2 0 3 6 6 2 10 0 0 6 3 2
BBusiness Products and Services 1 2 0 1 0 1 3 3 6 3 1 6 3 1 15 8 0 11 11 00 44 00 44 00 00 11 22 11
MMedical Devices and Equipment 3 10 8 4 5 8 12 27 15 17 20 44 13 2 0 11 7 4 0 13 8 11 11 2 0 4 2 1
CComputers and Peripherals 9 14 9 5 4 3 3 11 9 6 8 11 3 3 4 6 0 11 00 00 11 00 11 11 00 00 22 00
EElectronics/Instrumentation 1 6 3 0 0 2 0 4 13 5 9 10 3 1 2 3 1 00 00 00 00 00 00 00 11 11 11 00
HHealthcare Services 4 1 1 0 1 3 13 6 4 4 3 5 7 3 7 2 4 11 11 11 11 00 11 11 11 11 00 00
OOther 0 1 0 0 0 0 0 1 0 0 0 0 1 0 2 1 1 00 00 00 00 00 00 00 00 00 00 00
RRetailing/Distribution 5 3 3 5 1 1 1 6 12 3 3 9 4 6 17 4 1 11 11 00 11 11 22 00 00 22 00 00
TTotal 48 104 86 43 42 47 120 150 175 140 184 256 141 79 280 238 37 24 26 82 59 68 92 7 13 68 51 49
52 Thomson Reuters
2013 NVCA Yearbook
Figure 4.06
Average and Median Years Between First Funding
and the IPO by Industry 2000 to 2012
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Industry Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median Mean Median
Biotechnology 4.5 4.6 4.5 4.6 8.4 6.7 6.0 5.1 5.6 5.1 5.6 5.5 5.4 5.1 5.0 5.0 7.0 7.0 10.4 10.4 5.8 4.9 6.6 5.5 5.9 6.0
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 6.1 5.2 N/A N/A N/A N/A 0.6 0.6 4.2 4.2 5.7 5.7
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 6.7 6.7 8.7 8.7 N/A N/A N/A N/A 7.3 7.3 N/A N/A
CConsumer 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 17.8 17.8 N/A N/A 5.3 5.3 5.1 4.3 1.9 3.8 7.2 8.3
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 N/A N/A N/A
N/A N/A N/A N/A
N/A N/A N/A 7.78 7.8 3.7 3.7 12.5 12.5 N/A N/A
FFinancial 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 3.1 3.4 N/A N/A N/A N/A 7.0 8.9 N/A N/A 9.3 9.3
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 9.9 9.9 10.2 10.2 2.0 2.0 2.6 2.6 N/A N/A N/A N/A
IIndustrial/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 1.0 0.9 N/A N/A 1.4 1.4 3.1 3.1 7.0 7.2 5.2 5.4
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 6.1 6.5 N/A N/A N/A N/A 6.2 6.4 9.9 11.8 10.1 7.9
Media and Entertainment 4.3 3.2 N/A N/A 4.4 3.5 5.7 5.7 6.1 5.4 4.6 4.4 8.4 8.2 6.4 6.4 N/A N/A N/A N/A 8.7 10.1 6.7 6.2 6.3 6.4
Medical Devices and Equipment 5.1 3.9 4.8 4.5 3.7 3.2 N/A N/A 8.1 7.3 6.6 7.1 6.9 5.3 6.7 6.6 6.0 6.0 N/A N/A 5.2 5.2 5.5 5.5 4.9 4.9
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 7.70 6.6 6.3 6.7 N/A N/A N/A N/A 7.4 7.4 N/A N/A 10.1 9.9
Other 1.3 1.3 2.6 2.6 N/A 3.4 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 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 N/A N/A N/A
N/A N/A N/A
RRetailing/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 3.1 3.1 N/A N/A N/A N/A 2.2 2.2 N/A N/A N/A N/A
SSemiconductors 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 7.9 7.2 N/A N/A N/A N/A 4.9 4.4 7.6 7.6 13.1 13.1
Software 3.5 3.3 4.2 4.6 3.3 3.0 6.1 5.6 5.3 5.7 5.4 5.6 6.5 6.0 6.5 5.9 6.7 6.7 6.4 7.3 7.5 6.3 7.1 5.2 8.5 7.6
Telecommunications 3.6 3.1 1.4 1.4 N/A N/A 6.5 6.5 5.3 5.1 5.0 4.1 4.2 3.9 6.8 7.2 N/A N/A 10.4 10.4 8.7 9.1 8.0 9.8 9.4 8.8
Thomson Reuters 53

Venture-Backed Private Equity-Backed
Merger & Acquisitions by Year Merger & Acquisitions by Year
Number Number ($ Millions) Number Number ($ Millions)
Year Total Known Price Average Year Total Known Price Average
1985 6 3 300.2 100.1 1985 7 3 300.2 100.1
1986 8 1 63.4 9.1 1986 12 3 178.9 59.6
1987 10 4 667.2 111.2 1987 14 6 1,072.2 178.7
1988 17 9 920.7 115.1 1988 33 19 3,839.2 202.1
1989 20 10 746.9 74.7 1989 28 16 1,829.8 114.4
1990 19 7 120.3 10.0 1990 29 12 929.7 77.5
1991 16 4 190.5 15.9 1991 29 11 774.5 70.4
1992 69 43 2,119.1 81.5 1992 92 59 3,450.8 58.5
1993 59 36 1,332.9 58.0 1993 100 61 4,355.0 71.4
1994 82 56 3,207.1 123.4 1994 108 70 7,812.4 111.6
1995 92 58 3,801.8 111.8 1995 144 90 10,452.5 116.1
1996 107 76 8,230.8 265.5 1996 158 117 19,582.9 167.4
1997 143 99 7,743.6 176.0 1997 220 150 31,635.1 210.9
1998 189 113 8,002.0 105.3 1998 277 183 35,142.5 192.0
1999 227 154 38,688.0 530.0 1999 307 204 62,637.2 307.0
2000 379 245 79,996.4 597.0 2000 475 304 134,860.0 443.6
2001 384 175 25,115.6 120.2 2001 462 219 64,040.5 292.4
2002 363 165 11,913.2 60.2 2002 444 221 35,654.9 161.3
2003 323 134 8,240.8 43.6 2003 428 201 25,760.9 128.2
2004 402 199 28,846.1 142.1 2004 559 290 55,117.1 190.1
2005 443 198 19,600.2 80.0 2005 680 311 66,871.1 215.0
2006 485 207 24,288.5 87.4 2006 774 333 111,154.3 333.8
2007 488 200 30,745.5 106.8 2007 878 361 149,705.1 414.7
2008 416 134 16,236.9 57.6 2008 669 227 63,442.3 279.5
2009 350 108 12,364.9 51.1 2009 493 162 55,101.1 340.1
2010 521 149 17,700.3 47.6 2010 845 285 97,165.3 340.9
2011 488 169 24,093.2 75.5 2011 836 294 88,599.3 301.4
2012 449 121 21,516.2 65.6 2012 916 288 125,435.7 435.5
Average acquisition price is calculated by dividing total known Average acquisition price is calculated by dividing total known
acquisition proceeds by the number of transactions where the acquisition proceeds by the number of transactions where the
proceeds are known, not the total number of transactions proceeds are known, not the total number of transactions. Note:
Private Equity includes venture capital, buyouts, mezzanine, and
other private equity financed companies. Therefore, transactions
from Figure 5.07 are included here.
54 Thomson Reuters
2013 NVCA Yearbook
Figure 4.09
Venture-Backed Acquisitions by MoneyTree™ Industry
Total Transaction Values 1985 to 2011 ($ Million)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
S Software 0 0 25 0 0 22 83 264 116 455 617 1,228 2,122 2,888 5,621
5 23,475 3,689 1,886 2,098 4,972 4,870 7,704 6,923 5,575 1,745 3,739 6,756 5,199
Biotechnology 0 0 0 0 0 0 68 33 25 8 89 388 265 141 846 1,206 679 115 259 688 2,478 2,104 6,050 1,266 843 3,720 3,948 2,727
M Media and Entertainment 0 0 0 0 0 0 30 0 119 29 38 2,160 2,106 343 10,996 3,227 6,315 999 209 3,355 2,980 2,771 3,039 2,251 892 1,088 1,013 2,312
I IT Services 0 0 0 0 0 0 0 0 0 0 15 315 80 523 699 2,384 491 612 1,002 1,999 1,066 795 2,482 745 203 1,415 2,084 2,072
Telecommunications 0 0 0 0 0 0 0 4 298 790 328 381 1,133 521 2,218 7,528 2,630 1,125 301 1,678 1,310 2,287 1,785 1,789 2,205 826 451 1,979
Medical Devices and Equipment 201 0 3 0 317 0 0 234 43 295 110 298 507 130 298 433 932 414 580 1,168 1,268 1,704 1,818 499 2,569 1,571 3,809 1,639
Industrial/Energy 99 63 0 238 59 20 0 203 122 764 53 1,127 193 381 962 1,396 858 182 1,006 2,128 1,003 1,425 1,812 832 886 1,276 1,674 1,141
Semiconductors 0 0 0 0 0 0 0 0 0 59 84 54 11 627 1,903 7,210 2,099 2,703 359 688 575 1,029 964 664 628 1,040 743 1,035
Healthcare Services 0 0 0 199 60 0 0 88 0 178 475 130 180 64 0 286 177 818 37 6,227 624 968 542 27 5 755 601 756
Business Products and Services 0 0 640 0 0 0 0 0 0 0 0 109 181 47 397 1,637 157 870 151 3,024 132 409 2,124 570 314 181 315 697
Consumer Products and Services 0 0 0 0 0 0 10 1 0 26 23 46 237 388 385 2,611 519 343 418 444 582 486 245 284 0 141 1,143 615
Financial Services 0 0 0 140 0 0 0 1,204 91 144 734 67 34 459 1,299 1,355 617 557 98 250 890 985 1,896 988 0 812 466 435
Networking and Equipment 0 0 0 18 250 0 0 0 317 352 1,024 1,090 178 981 11,521 18,359 5,403 818 813 1,311 1,290 628 549 609 643 678 24 146
Electronics/Instrumentation 0 0 0 81 0 0 0 36 13 49 42 12 105 60 133 3,456 189 71 6 116 72 38 87 80 0 0 510 0
O Other 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 0 0 3350 0 0 212 0 246 0 0 95 0 0
R Retailing/Distribution 0 0 0 95 0 0 0 35 80 0 29 0 39 28 689 824 4 0 857 118 0 463 180 10 930 14 0 0
T Total 300 63 667 921 747 120 190 2,119 1,333 3,207 3,802 8,231 7,744 8,002 38,688 79,996 25,116 11,913 8,241 28,846 19,600 24,289 30,746 16,237 12,365 17,700 24,093 21,516
Figure 4.10
Venture-Backed Acquisitions by MoneyTree™ Industry
Number of Companies 1985 to 2012
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SSoftware 0 3 2 0 1 6 1 11 15 24 29 21 43 62 59 119 94 128 120 133
1 162 175 157 147 119 169 171 152
IT Services 0 1 0 1 1 1 0 0 0 0 2 5 7 11 16 22 31 38 25 33 22 30 38 27 22 45 47 50
Biotechnology 0 0 0 0 1 1 1 4 2 3 10 9 9 11 12 16 21 9 15 24 30 32 32 24 19 38 34 30
Semiconductors 0 0 0 0 0 1 2 1 1 3 3 2 2 8 9 21 14 14 11 17 17 20 19 24 22 26 15 15
CComputers and Peripherals 1 0 2 2 4 4 2 9 8 4 5 9 8 7 11 13 6 2 8 8 8 101 3 7 4 6 7 6
EElectronics/Instrumentation 0 0 1 3 2 0 1 4 2 1 1 4 6 4 3 4 7 7 4 5 3 5 5 7 4 5 4 4
RRetailing/Distribution 2 0 0 1 0 1 2 2 3 1 1 0 4 2 7 14 15 7 7 7 8 101 9 5 1 5 1 4
OOther 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 1 1 1 11 0 2 22 00 1 2 0
TTotal 6 8 10 17 20 19 16 69 59 82 92 107 143 189 227 379 384 363 323 402 443 485 488 416 350 521 488 449
Thomson Reuters 55
Figure 4.11
Private Equity-Backed Acquisitions by MoneyTree™ Industry
Total Transaction Values 1985 to 2012 ($ Million)
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
IIndustrial/Energy 99 63 25 1,490 311 20 102 792 1,881 922 2,490 2,120 4,610 4,738 2,841 2,973 3,193 4,073 7,317 12,455 21,258 24,179 23,751 12,510 1,850 25,115 25,706 31,281
MMedia and Entertainment 0 0 0 0 32 220 30 0 213 350 398 3,428 3,195 11,274 19,833 42,607 6,332 4,439 1,612 6,958 5,379 26,770 8,738 3,024 1,678 2,248 4,022 15,097
Biotechnology 0 0 0 0 766 0 68 33 25 80 422 407 396 622 879 2,102 679 2,540 927 1,738 2,978 2,104 7,127 1,443 4,857 7,052 4,499 13,182
Software 0 0 25 16 0 22 83 686 128 455 629 1,228 2,252 3,041 10,115 25,732 3,795 2,121 3,983 5,574 5,478 9,493 20,762 7,517 2,262 15,688 14,348 12,969
TTelecommunications 0 0 0 0 0 0 0 79 298 1,042 698 2,399 1,187 1,331 2,426 11,257 32,034 7,332 451 2,232 5,731 12,623 4,451 2,162 31,482 3,795 3,516 9,295
Healthcare Services 0 0 0 199 60 0 0 94 0 178 598 1,494 3,702 317 112 668 617 1,237 37 7,403 3,440 3,643 4,054 780 581 8,210 4,942 8,034
Financial Services 0 0 0 140 0 0 0 1,204 461 695 2,283 2,728 2,745 1,520 1,605 1,383 1,116 3,038 292 474 2,957 985 3,349 3,792 3,463 2,271 9,887 7,077
Consumer Products and Services 0 116 0 1,444 33 45 10 30 634 1,729 699 1,078 1,360 1,645 575 3,612 1,628 2,711 3,656 5,264 5,981 10,238 23,880 2,242 1,451 7,257 2,285 4,297
Retailing/Distribution 0 0 0 295 0 0 475 96 94 90 472 452 8,384 3,738 3,265 1,660 2,227 175 3,174 1,042 978 1,700 30,996 924 945 6,509 554 4,259
Business Products and Services 0 0 640 0 0 263 7 12 0 0 200 419 207 1,331 694 2,532 513 1,356 253 4,077 1,238 11,642 5,825 6,504 561 959 2,540 3,890
Medical Devices and Equipment 201 0 383 0 317 167 0 373 182 1,731 244 1,000 1,298 2,075 1,324 516 1,188 940 1,243 2,078 2,304 2,845 6,073 6,131 3,422 7,477 5,660 3,756
Other 0 0 0 0 0 0 0 0 0 0 0 0 0 229 0 0 176 350 190 143 1,676 630 411 8,203 0 2,865 871 3,521
IT Services 0 0 0 7 0 0 0 0 0 0 15 485 1,620 523 2,834 3,138 533 674 1,282 2,124 2,192 929 4,838 5,509 203 3,696 2,172 2,685
Electronics/Instrumentation 0 0 0 81 0 115 0 36 13 49 42 375 107 162 312 3,456 1,226 381 6 422 948 72 3,210 431 0 1,333 2,407 2,275
Networking and Equipment 0 0 0 18 250 0 0 0 317 352 1,024 1,090 178 1,337 12,000 21,167 6,033 818 934 1,406 2,348 1,536 946 782 1,218 678 3,838 1,814
SSemiconductors 0 0 0 0 0 0 0 0 0 59 97 54 11 640 3,066 7,324 2,224 3,248 359 731 1,251 1,272 1,266 719 628 1,665 743 1,152
Total 300 179 1,072 3,839 1,830 930 775 3,451 4,355 7,812 10,452 19,583 31,635 35,143 62,637 134,860 64,041 35,655 25,761 55,117 66,871 111,154 149,705 63,442 55,101 97,165 88,599 125,436
Note: Private Equity includes venture capital, buyouts, mezzanine, and other private equity financed companies. Therefore, transactions
Figure 4.12
Private Equity-Backed Acquisitions by MoneyTree™ Industry
Number of Companies 1985 to 2012
Industry 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
IIndustrial/Energy 2 3 3 9 5 4 9 17 20 12 25 20 35 39 33 37 35 33 46 65 126 114 148 114 58 121 133 209
Software 0 3 2 1 1 6 2 13 17 26 30 21 44 66 67 127 98 133 127 143 170 197 183 163 131 200 206 188
IT Services 0 1 0 3 1 1 0 1 0 0 3 6 12 12 22 25 32 41 27 36 26 42 49 30 24 56 51 62
Biotechnology 0 0 0 0 3 1 1 4 3 6 13 10 10 16 14 18 22 12 17 28 36 33 36 28 26 48 42 40
Semiconductors 0 0 0 0 0 1 2 1 1 3 4 2 2 10 11 26 15 16 11 19 19 21 22 29 22 29 19 16
Other 0 0 0 0 0 0 0 0 0 0 1 0 0 1 0 0 1 1 3 4 101 4 8 14 1 8 8 7
TTotal 7 12 14 33 28 29 29 92 100 108 144 158 220 277 307 475 462 444 428 559 680 774 878 669 493 845 836 916
Note: Private Equity includes venture capital, buyouts, mezzanine, and other private equity financed companies. Therefore, transactions
56 Thomson Reuters
2013 NVCA Yearbook
Figure 4.13
M&A Transaction Values vs.
Amount Invested
Relationship Between Transaction
Values vs. Cumulative Total Venture Investment
Year < TVI 1x-4x TVI 4x-10x TVI >10x TVI
1995 14% 26% 22% 38%
1996 8% 29% 29% 34%
1997 13% 40% 16% 31%
1998 15% 23% 31% 31%
1999 15% 15% 25% 45%
2000 9% 22% 23% 46%
2001 41% 19% 23% 17%
2002 51% 26% 13% 10%
2003 46% 39% 10% 5%
2004 38% 33% 19% 10%
2005 30% 38% 17% 15%
2006 30% 37% 18% 15%
2007 24% 33% 24% 19%
2008 30% 30% 24% 16%
2009 47% 24% 20% 9%
2010 32% 33% 21% 14%
2011 20% 29% 30% 21%
2012 20% 27% 32% 21%
This chart is prepared by analyzing all deals where total venture investment and acquisition price
are confirmed. Each deal is classified as a ratio of company acquisition (exit) price to total ven-
ture 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 out-
come. An acquisition for more than 10 times venture investment is usually a nice outcome.
Figure 4.14
Venture-Backed IPOs
Cos. in Registration vs.
Number of Venture-Backed IPOs
# of Moneytree Cos. in
Year # of Venture Backed IPOs Registration
2003 29 31
2004 94 57
2005 57 16
2006 57 36
2007 86 31
2008 6 20
2009 12 23
2010 75 31
2011 53 60
2012 49 27*
* Beginning in 2012, companies could elect confidential registration. Those, of course, cannot be
counted in the number in registration. As of this writing, it appears that half or more of compa-
nies seeking to go public are electing confidential registration.
Thomson Reuters 57
Figure 4.15
Post-Offer Value Ranges
Venture-Backed IPO Post Offer Value Ranges by Number of Companies
Year >$1B $500M-$1B $100M-$500M <$100M

1995 1 4 58 62
1996 4 10 107 89
1997 1 3 55 63
1998 1 3 29 11
1999 16 31 147 10
2000 12 25 96 4
2001 5 5 12 5
2002 - 7 15 2
2003 - 2 22 2
2004 4 10 64 4
2005 4 7 35 13
2006 7 11 45 4
2007 15 16 57 4
2008 2 - 4 1
2009 3 4 6 -
2010 20 6 40 2
2011 17 13 19 2
2012 9 9 29 2
* Count only includes IPOs with disclosed post-offer values
Figure 4.16
M&A Deal Value Ranges
Venture-Backed M&A 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 21 77
1998 - - 27 86
1999 2 12 57 83
2000 15 23 101 106
2001 3 3 44 125
2002 1 3 26 136
2003 - 2 28 104
2004 5 5 44 145
2005 1 3 55 140
2006 2 3 60 142
2007 1 12 71 117
2008 2 4 36 92
2009 - 6 31 72
2010 - 6 50 93
2011 1 10 60 98
2012 4 6 48 64
* Count only includes transactions with disclosed values
58 Thomson Reuters
2013 NVCA Yearbook
Figure 4.17
Venture-Backed US Company IPOs By Year
By Country
Country 2005 2006 2007 2008 2009 2010 2011 2012 Total
Offer Amt Offer Amt Offer Amt Offer Amt Offer Amt Offer Amt Offer Amt Offer Amt Offer Amt
# Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil) # Exits ($ Mil)
Argentina - - - - 1 332.8 - - - - -- -- -- -- -- -- 11 332.8
3
Bermuda - - - - - - - - - - -- -- 11 621.3
6 - - 1 621.3
Bahamas - - 1 137.5 - - - - - - -- -- -- -- -- -- 11 137.5
1
Canada 1 91.1 - - 1 57.5 - - - - -- -- 11 54.0 5 - - 3 202.6
China 5 621.1 5 624.7 12 2,482.5 - - 2 220.0 20 2,738.5 8 1,739.7 2 165.7 54 8,592.1
France - - - - - - - - - - 11 77.0
7 - - 1 77.0
Hong Kong - - - - - - - - - - 11 103.3
1 - - - - 1 103.3
India - - - - - - - - - - 11 80.58 - - - - 1 80.5
Israel 2 67.5 1 78.0 1 26.3 - - - - -- -- -- -- -- -- 44 171.8 1
Netherlands - - - - - - - - - - -- -- 11 304.6
3 - - 1 304.6
Norway - - 1 43.8 - - - - -- -- -- -- -- -- 11 43.8
4
Russia - - 1 380.5 - - - - - - -- -- 11 1,434.8
1,43 - - 2 1,815.3
South Korea 2 190.8 1 144.1 - - - - - - -- -- -- -- -- -- 33 334.93
Taiwan 1 70.4 - - - - - - - - -- -- -- -- -- -- 11 70.4
7
US 48 4,072.5 58 5,718.4 77 9,466.5 7 765.0 11 1,759.8 46 4,686.8 38 6,458.1 47 21,285.4 332 54,212.6
Figure 4.18
Ratio of IPO Pre-Money Valuation
To Amount Invested
Post Offer IPO Pre Total Venture

Value Offer Amt Money Inv
Year ($ Billion) ($ Billion) Valuation ($ Billion) Ratio
1995 17.0 7.9 9.2 2.2 4.2
1996 40.4 12.7 27.7 3.7 7.5
1997 17.8 5.8 12.0 2.7 4.4
1998 9.6 4.2 5.4 2.4 2.3
1999 86.7 24.0 62.7 11.0 5.7
2000 63.6 27.4 36.2 13.0 2.8
2001 15.5 4.1 11.4 2.6 4.4
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 71.5 7.1 64.3 4.3 15.0
2007 68.3 12.4 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 111.4 7.6 103.8 5.9 17.6
2011 95.0 10.7 84.3 6.6 12.8
2012 122.3 21.5 100.8 6.7 15.0
Note: To be included in this chart, non-U.S. based companies must be trading on a U.S.
exchange/market and have at least 1 U.S. venture fund investor.
Thomson Reuters 59
Figure 4.19
Venture-Backed IPOs Valuations
As Of IPO
Avg Upper Lower

Val Max Quartile Median Quartile Min
Year of IPO ($ Mil) ($ Mil) ($ Mil) ($ Mil) ($ Mil) ($ Mil)
1995 136.4 1,068.5 144.8 103.3 60.9 10.4
1996 191.3 4,548.9 183.1 111.1 64.2 9.5
1997 145.8 1,106.3 60.3 98.8 59.8 6.6
1998 214.4 1,116.2 226.1 148.8 101.4 12.5
1999 424.8 2,970.2 480.5 294.4 193.0 16.9
2000 464.3 2,767.7 539.7 335.8 213.9 18.0
2001 575.7 3,464.1 723.7 303.5 141.0 46.6
2002 346.7 822.4 541.0 266.2 165.7 36.8
2003 285.1 821.9 359.2 251.9 170.4 41.9
2004 613.0 23,053.7 391.0 254.1 151.7 21.6
2005 672.9 22,422.9 396.8 201.9 133.0 4.6
2006 1,066.7 39,248.4 534.9 293.2 179.5 70.9
2007 742.2 14,035.4 762.8 360.8 268.6 50.0
2008 520.7 1,443.1 1,011.5 278.5 184.4 75.8
2009 707.1 1,622.0 1,089.0 547.9 306.9 212.9
2010 1,662.5 23,725.8 1,414.1 430.5 223.0 23.4
2011 1,862.5 16,795.6 1,514.7 606.3 327.1 94.8
2012 2,495.2 81,247.2 727.2 371.0 243.6 75.2
60 Thomson Reuters
Appendix A: Glossary
“A” round – a financing event whereby angel groups ownership in a company due to the issuance by the
and / or venture capitalists become involved in a fast company of additional shares to other entities. The
growth company that was previously financed by mechanism for making an adjustment that maintains
founders and their friends and families. the same percentage ownership is called a Full
Ratchet. The most commonly used adjustment pro-
Accredited investor – a person or legal entity, such vides partial protection and is called Weighted
as a company or trust fund, that meets certain net Average.
worth and income qualifications and is considered to
be sufficiently sophisticated to make investment “B” round – a financing event whereby investors
decisions in private offerings. Regulation D of the such as venture capitalists and organized angel
Securities Act of 1933 exempts accredited investors groups are sufficiently interested in a company to
from protection of the Securities Act. The Securities provide additional funds after the “A” round of
and Exchange Commission has proposed revisions to financing. Subsequent rounds are called “C”, “D”
the accredited investor qualifying rules, which may and so on.
or may not result in changes for venture investors.
The current criteria for a natural person are: $1 mil- Basis point (“bp”) – one one-hundredth (1/100) of a
lion net worth or annual income exceeding $200,000 percentage unit. For example, 50 basis points equals
individually or $300,000 with a spouse. Directors, one half of one percent. Banks quote variable loan
general partners and executive officers of the issuer rates in terms of an index plus a margin and the mar-
are considered to be accredited investors. gin is often described in basis points, such as LIBOR
plus 400 basis points (or, as the experts say, “beeps”).
Alternative asset class – a class of investments that
includes venture capital, leverage buyouts, hedge Beta – a measure of volatility of a public stock rela-
funds, real estate, and oil and gas, but excludes pub- tive to an index or a composite of all stocks in a mar-
licly traded securities. Pension plans, college endow- ket or geographical region. A beta of more than one
ments and other relatively large institutional indicates the stock has higher volatility than the
investors typically allocate a certain percentage of index (or composite) and a beta of one indicates
their investments to alternative assets with an objec- volatility equivalent to the index (or composite). For
tive to diversify their portfolios. example, the price of a stock with a beta of 1.5 will
change by 1.5% if the index value changes by 1%.
Alpha – a term derived from statistics and finance Typically, the S&P500 index is used in calculating
theory that is used to describe the return produced by the beta of a stock.
a fund manager in excess of the return of a bench-
mark index. Manager returns and benchmark returns Beta product – a product that is being tested by
are measured net of the risk-free rate. In addition, potential customers prior to being formally launched
manager returns are adjusted for the risk of the man- into the marketplace.
ager’s portfolio relative to the risk of the benchmark
index. Alpha is a proxy for manager skill. Board of directors – a group of individuals, typical-
ly composed of managers, investors and experts who
Angel – a wealthy individual that invests in compa- have a fiduciary responsibility for the well being and
nies in relatively early stages of development. proper guidance of a corporation. The board is elect-
Usually angels invest less than $1 million per startup. ed by the shareholders.
Anti-dilution – a contract clause that protects an Book – see Private placement memorandum.
investor from a substantial reduction in percentage
Thomson Reuters 61
Bootstrapping – the actions of a startup to minimize Buyout – a sector of the private equity industry. Also,
expenses and build cash flow, thereby reducing or the purchase of a controlling interest of a company
eliminating the need for outside investors. by an outside investor (in a leveraged buyout) or a
management team (in a management buyout).
Bp – see Basis point.
Buy-sell agreement – a contract that sets forth the
Bridge financing – temporary funding that will conditions under which a shareholder must first offer
eventually be replaced by permanent capital from his or her shares for sale to the other shareholders
equity investors or debt lenders. In venture capital, a before being allowed to sell to entities outside the
bridge is usually a short term note (6 to 12 months) company.
that converts to preferred stock. Typically, the bridge
lender has the right to convert the note to preferred C Corporation – an ownership structure that allows
stock at a price that is a 20% to 25% discount from any number of individuals or companies to own
the price of the preferred stock in the next financing shares. A C corporation is a stand-alone legal entity
round. See Mezzanine and Wipeout bridge. so it offers some protection to its owners, managers
and investors from liability resulting from its actions.
Broad-based weighted average anti-dilution – A
weighted average anti-dilution method adjusts down- Capital Asset Pricing Model (CAPM) – a method
ward the price per share of the preferred stock of of estimating the cost of equity capital of a company.
investor A due to the issuance of new preferred The cost of equity capital is equal to the return of a
shares to new investor B at a price lower than the risk-free investment plus a premium that reflects the
price investor A originally received. Investor A’s pre- risk of the company’s equity.
ferred stock is repriced to a weighted average of
investor A’s price and investor B’s price. A broad- Capital call – when a private equity fund manager
based anti-dilution method uses all common stock (usually a “general partner” in a partnership) requests
outstanding on a fully diluted basis (including all that an investor in the fund (a “limited partner”) pro-
convertible securities, warrants and options) in the vide additional capital. Usually a limited partner will
denominator of the formula for determining the new agree to a maximum investment amount and the gen-
weighted average price. See Narrow-based weighted eral partner will make a series of capital calls over
average anti-dilution. time to the limited partner as opportunities arise to
finance startups and buyouts.
Burn rate – the rate at which a startup with little or
no revenue uses available cash to cover expenses. Capital gap – the difficulty faced by some entrepre-
Usually expressed on a monthly or weekly basis. neurs in trying to raise between $2 million and $5
million. Friends, family and angel investors are typi-
Business Development Company (BDC) – a pub- cally good sources for financing rounds of less than
licly traded company that invests in private compa- $2 million, while many venture capital funds have
nies and is required by law to provide meaningful become so large that investments in this size range
support and assistance to its portfolio companies. are difficult.
Business plan – a document that describes a new Capitalization table – a table showing the owners of
concept for a business opportunity. A business plan a company’s shares and their ownership percentages
typically includes the following sections: executive as well as the debt holders. It also lists the forms of
summary, market need, solution, technology, compe- ownership, such as common stock, preferred stock,
tition, marketing, management, operations, exit strat- warrants, options, senior debt, and subordinated debt.
egy, and financials (including cash flow projections).
For most venture capital funds fewer than 10 of every Capital gains – a tax classification of investment
100 business plans received eventually receive fund- earnings resulting from the purchase and sale of
ing. assets. Typically, a company’s investors and founders
have earnings classified as long term capital gains
62 Thomson Reuters
2013 NVCA Yearbook
(held for a year or longer), which are taxed at a lower Club deal – the act of investing by two or more enti-
rate than ordinary income. ties in the same target company, usually involving a
leveraged buyout transaction.
Capital stock – a description of stock that applies
when there is only one class of shares. This class is Co-investment – the direct investment by a limited
known as “common stock”. partner alongside a general partner in a portfolio
company.
Capital Under Management – A frequently-used
metric for sizing total funds managed by a venture Collateral – hard assets of the borrower, such as real
capital or buyout firm. In practice, there are several estate or equipment, for which a lender has a legal
ways of calculating this. In the US, this is the total interest until a loan obligation is fully paid off.
committed capital for all funds managed by a firm on
which it collects management fees. This calculation Commitment – an obligation, typically the maxi-
ignores whether portions of the committed capital mum amount that a limited partner agrees to invest in
have not yet been called and whether portions of the a fund. See Capital call.
fund have been liquidated and distributed. It typical-
ly does not include aging funds in their “out years” Common stock – a type of security representing
on which fees are not being collected. For purposes ownership rights in a company. Usually, company
of this book in calculating capital managed in figure founders, management and employees own common
1.04, because direct data is not available, the last stock while investors own preferred stock. In the
eight vintage years of capital commitments is consid- event of a liquidation of the company, the claims of
ered a proxy for the industry’s total capital under secured and unsecured creditors, bondholders and
management. preferred stockholders take precedence over common
stockholders. See Preferred stock.
Capped participating preferred stock – preferred
stock whose participating feature is limited so that an Comparable – a private or public company with
investor cannot receive more than a specified similar characteristics to a private or public company
amount. See Participating preferred stock. that is being valued. For example, a telecommunica-
tions equipment manufacturer whose market value is
Carried interest – the share in the capital gains of a 2 times revenues can be used to estimate the value of
venture capital fund which is allocated to the General a similar and relatively new company with a new
Partner. Typically, a fund must return the capital product in the same industry. See Liquidity discount.
given to it by limited partners plus any preferential
rate of return before the general partner can share in Control – the authority of an individual or entity that
the profits of the fund. The general partner will typi- owns more than 50% of equity in a company or owns
cally receive a 20% carried interest, although some the largest block of shares compared to other share-
successful firms receive 25%-30%. Also known as holders.
“carry” or “promote.”
Consolidation – see Rollup.
Clawback – a clause in the agreement between the
general partner and the limited partners of a private Conversion – the right of an investor or lender to
equity fund. The clawback gives limited partners the force a company to replace the investor’s preferred
right to reclaim a portion of disbursements to a gen- shares or the lender’s debt with common shares at a
eral partner for profitable investments based on sig- preset conversion ratio. A conversion feature was
nificant losses from later investments in a portfolio. first used in railroad bonds in the 1800’s.
Closing – the conclusion of a financing round where- Convertible debt – a loan which allows the lender to
by all necessary legal documents are signed and cap- exchange the debt for common shares in a company
ital has been transferred. at a preset conversion ratio. Also known as a “con-
vertible note.”
Thomson Reuters 63
Convertible preferred stock – a type of stock that Current ratio – the ratio of current assets to current
gives an owner the right to convert to common shares liabilities.
of stock. Usually, preferred stock has certain rights
that common stock doesn’t have, such as decision- Data room – a specific location where potential buy-
making management control, a promised return on ers / investors can review confidential information
investment (dividend), or senior priority in receiving about a target company. This information may
proceeds from a sale or liquidation of the company. include detailed financial statements, client con-
Typically, convertible preferred stock automatically tracts, intellectual property, property leases, and
converts to common stock if the company makes an compensation agreements.
initial public offering (IPO). Convertible preferred is
the most common tool for private equity funds to Deal flow – a measure of the number of potential
invest in companies. investments that a fund reviews in any given period.
Co-sale right – a contractual right of an investor to Defined benefit plan – a company retirement plan in
sell some of the investor’s stock along with the which the benefits are typically based on an employ-
founder’s or majority shareholder’s stock if either the ee’s salary and number of years worked. Fixed bene-
founder or majority shareholder elects to sell stock to fits are paid after the employee retires. The employer
a third-party. Also known as Tag-along right. bears the investment risk and is committed to provid-
ing the benefits to the employee. Defined benefit
Cost of capital – see Weighted average cost of capi- plan managers can invest in private equity funds.
tal.
Defined contribution plan – a company retirement
Cost of revenue – the expenses generated by the core plan in which the employee elects to contribute some
operations of a company. portion of his or her salary into a retirement plan,
such as a 401(k) or 403(b). The employer may also
Covenant – a legal promise to do or not do a certain contribute to the employee’s plan. With this type of
thing. For example, in a financing arrangement, com- plan, the employee bears the investment risk. The
pany management may agree to a negative covenant, benefits depend solely on the amount of money made
whereby it promises not to incur additional debt. The from investing the employee’s contributions. Defined
penalties for violation of a covenant may vary from contribution plan capital cannot be invested in private
repairing the mistake to losing control of the compa- equity funds.
ny.
Demand rights – a type of registration right.
Coverage ratio – describes a company’s ability to Demand rights give an investor the right to force a
pay debt from cash flow or profits. Typical measures startup to register its shares with the SEC and prepare
are EBITDA/Interest, (EBITDA minus Capital for a public sale of stock (IPO).
Expenditures)/Interest, and EBIT/Interest.
Dilution – the reduction in the ownership percentage
Cram down round – a financing event upon which of current investors, founders and employees caused
new investors with substantial capital are able to by the issuance of new shares to new investors.
demand and receive contractual terms that effective-
ly cause the issuance of sufficient new shares by the Dilution protection – see Anti-dilution and Full
startup company to significantly reduce (“dilute”) ratchet.
the ownership percentage of previous investors.
Direct secondary transaction – A transaction in
Cumulative dividends – the owner of preferred which the buyer purchases shares of an operating
stock with cumulative dividends has the right to company from an existing seller. While the transac-
receive accrued (previously unpaid) dividends in full tion is a secondary sale of shares, the transacted
before dividends are paid to any other classes of interest is a primary issue purchase directly into an
stock. operating company. Sellers are often venture capital-
64 Thomson Reuters
2013 NVCA Yearbook
ists selling their ownership stake in a portfolio com- Dutch auction – a method of conducting an IPO
pany. Buyers are often funds that specialize in such where-by newly issued shares of stock are committed
investments. to the highest bidder, then, if any shares remain, to
the next highest bidder, and so on until all the shares
Disbursement – an investment by a fund in a compa- are committed. Note that the price per share paid by
ny. all buyers is the price commitment of the buyer of the
last share.
Discount rate – the interest rate used to determine
the present value of a series of future cash flows. Early stage – the state of a company after the seed
(formation) stage but before middle stage (generating
Discounted cash flow (DCF) – a valuation method- revenues). Typically, a company in early stage will
ology whereby the present value of all future cash have a core management team and a proven concept
flows expected from a company is calculated. or product, but no positive cash flow.
Distressed debt – the bonds of a company that is Earnings before interest and taxes (EBIT) – a
either in or approaching bankruptcy. Some private measurement of the operating profit of a company.
equity funds specialize in purchasing such debt at One possible valuation methodology is based on a
deep discounts with the expectation of exerting influ- comparison of private and public companies’ value as
ence in the restructuring of the company and then a multiple of EBIT.
selling the debt once the company has meaningfully
recovered. Earnings before interest, taxes, depreciation and
amortization (EBITDA) – a measurement of the
Distribution – the transfer of cash or securities to a cash flow of a company. One possible valuation
limited partner resulting from the sale, liquidation or methodology is based on a comparison of private and
IPO of one or more portfolio companies in which a public companies’ value as a multiple of EBITDA.
general partner chose to invest.
Earn out – an arrangement in which sellers of a busi-
Dividends – payments made by a company to the ness receive additional future payments, usually
owners of certain securities. Typically, dividends are based on financial performance metrics such as rev-
paid quarterly, by approval of the board of directors, enue or net income.
to owners of preferred stock.
Elevator pitch – a concise presentation, lasting only
Down round – a round of financing whereby the val- a few minutes (an elevator ride), by an entrepreneur
uation of the company is lower than the value deter- to a potential investor about an investment opportuni-
mined by investors in an earlier round. ty.
Drag-along rights – the contractual right of an Employee Stock Ownership Program (ESOP) – a
investor in a company to force all other investors to plan established by a company to reserve shares for
agree to a specific action, such as the sale of the com- employees.
pany.
Entrepreneur – an individual who starts his or her
Drawdown schedule – an estimate of the gradual own business.
transfer of committed investment funds from the lim-
ited partners of a private equity fund to the general Entrepreneurship – the application of innovative
partners. leadership to limited resources in order to create
exceptional value.
Due diligence – the investigatory process performed
by investors to assess the viability of a potential Enterprise Value (EV) – the sum of the market val-
investment and the accuracy of the information pro- ues of the common stock and long term debt of a
vided by the target company. company, minus excess cash.
Thomson Reuters 65
Equity – the ownership structure of a company rep- FCFE, the discount rate used is the cost of equity.
resented by common shares, preferred shares or unit
interests. Equity = Assets – Liabilities. Free cash flow to the firm (FCFF) – the operating
cash flow available after operating expenses, taxes,
ESOP – see Employee Stock Ownership Program. reinvestment needs and changes in working capital,
Evergreen fund – a fund that reinvests its profits in but before any interest payments on debt are made. In
order to ensure the availability of capital for future a discounted cash flow model to determine the enter-
investments. prise value of a firm using FCFF, the discount rate
used is the weighted average cost of capital (WACC).
Exit strategy – the plan for generating profits for
owners and investors of a company. Typically, the Friends and family financing – capital provided by
options are to merge, be acquired or make an initial the friends and family of founders of an early stage
public offering (IPO). An alternative is to recapitalize company. Founders should be careful not to create an
(releverage the company and then pay dividends to ownership structure that may hinder the participation
shareholders). of professional investors once the company begins to
achieve success.
Expansion stage – the stage of a company character-
ized by a complete management team and a substan- Full ratchet – an anti-dilution protection mechanism
tial increase in revenues. whereby the price per share of the preferred stock of
investor A is adjusted downward due to the issuance
Fair value – a financial reporting principle for valu- of new preferred shares to new investor B at a price
ing assets and liabilities, for example, portfolio com- lower than the price investor A originally received.
panies in venture capital fund portfolios. This has Investor A’s preferred stock is repriced to match the
received much recent attention as the Financial price of investor B’s preferred stock. Usually as a
Accounting Standards Board (FASB) has issued result of the implementation of a ratchet, company
definitive guidance (FAS 157) on this long standing management and employees who own a fixed
principle. amount of common shares suffer significant dilution.
See Narrow-based weighted average anti-dilution
Fairness opinion – a letter issued by an investment and Broad-based weighted average anti-dilution.
bank that charges a fee to assess the fairness of a
negotiated price for a merger or acquisition. Fully diluted basis – a methodology for calculating
any per share ratios whereby the denominator is the
FAS 157 – an an accounting standard developed by total number of shares issued by the company on the
the Financial Accounting Standards Board (FASB) assumption that all warrants and options are exer-
regarding the application of a fair value principle. cised and preferred stock.
First refusal – the right of a privately owned compa- Fund-of-funds – a fund created to invest in private
ny to purchase any shares that employees would like equity funds. Typically, individual investors and rela-
to sell. tively small institutional investors participate in a
fund-offunds to minimize their portfolio manage-
Founders stock – nominally priced common stock ment efforts.
issued to founders, officers, employees, directors,
and consultants. Gatekeepers – intermediaries which endowments,
pension funds and other institutional investors use as
Free cash flow to equity (FCFE) – the cash flow advisors regarding private equity investments.
available after operating expenses, interest payments
on debt, taxes, net principal repayments, preferred General partner (GP) – a class of partner in a part-
stock dividends, reinvestment needs and changes in nership. The general partner retains liability for the
working capital. In a discounted cash flow model to actions of the partnership. Historically, venture capi-
determine the value of the equity of a firm using tal and buyout funds have been structured as limited
66 Thomson Reuters
2013 NVCA Yearbook
partnerships, with the venture firm as the GP and use a variety of derivative instruments in order to
limited partners (LPs) being the institutional and achieve a return that is relatively less correlated to the
high net worth investors that provide most of the cap- performance of typical indices (such as the S&P 500)
ital in the partnership. The GP earns a management than traditional long-only funds. Hedge fund man-
fee and a percentage of gains (see Carried interest). agers are typically compensated based on assets
under management as well as fund performance.
GP – see General partner.
High yield debt – debt issued via public offering or
GP for hire – In a spin-out or a synthetic secondary, public placement (Rule 144A) that is rated below
a GP for hire refers to the professional investor who investment grade by S&P or Moody’s. This means
may be hired by a purchasing firm to manage the new that the debt is rated below the top four rating cate-
fund created from the orphaned assets purchased. In gories (i.e. S&P BB+, Moody’s Ba2 or below). The
past cases, the GP has often expanded its role to lower rating is indicative of higher risk of default,
fundraise for and run new funds aside from the initial and therefore the debt carries a higher coupon or
fund. yield than investment grade debt. Also referred to as
Junk bonds or Sub-investment grade debt.
Going-private transaction – when a public compa-
ny chooses to pay off all public investors, delist from Hockey stick – the general shape and form of a chart
all stock exchanges, and become owned by manage- showing revenue, customers, cash or some other
ment, employees, and select private investors. financial or operational measure that increases dra-
matically at some point in the future. Entrepreneurs
Golden handcuffs – financial incentives that dis- often develop business plans with hockey stick charts
courage founders and / or important employees from to impress potential investors.
leaving a company before a predetermined date or
important milestone. Holding period – amount of time an investment
remains in a portfolio.
Grossing up – an adjustment of an option pool for
management and employees of a company which Hot issue – stock in an initial public offering that is
increases the number of shares available over time. in high demand.
This usually occurs after a financing round whereby
one or more investors receive a relatively large per- Hot money – capital from investors that have no tol-
centage of the company. Without a grossing up, man- erance for lack of results by the investment manager
agers and employees would suffer the financial and and move quickly to withdraw at the first sign of
emotional consequences of dilution, thereby poten- trouble.
tially affecting the overall performance of the compa-
ny. Hurdle rate – a minimum rate of return required
before an investor will make an investment.
Growth stage – the state of a company when it has
received one or more rounds of financing and is gen- Incorporation – the process by which a business
erating revenue from its product or service. Also receives a state charter, allowing it to become a cor-
known as “middle stage.” poration. Many corporations choose Delaware
because its laws are business-friendly and up to date.
Hart-Scott-Rodino Act – a law requiring entities
that acquire certain amounts of stock or assets of a Incubator – a company or facility designed to host
company to inform the Federal Trade Commission startup companies. Incubators help startups grow
and the Department of Justice and to observe a wait- while controlling costs by offering networks of con-
ing period before completing the transaction. tacts and shared backoffice resources.
Hedge fund – an investment fund that has the ability Indenture – the terms and conditions between a
to use leverage, take short positions in securities, or bond issuer and bond buyers.
Thomson Reuters 67
Initial public offering (IPO) – the first offering of capital industry and has published guidelines for
stock by a company to the public. New public offer- applying US GAAP and international IFRS valuation
ings must be registered with the Securities and rules. See www.privateequityvaluation.com
Exchange Commission. An IPO is one of the meth-
ods that a startup that has achieved significant suc- IPO – see Initial public offering.
cess can use to raise additional capital for further IRR – see Internal rate of return.
growth. See Qualified IPO.
Issuer – the company that chooses to distribute a
In-kind distribution – a distribution to limited part- portion of its stock to the public.
ners of a private equity fund that is in the form of
publicly trades shares rather than cash. J curve – a concept that during the first few years of
a private equity fund, cash flow or returns are nega-
Inside round – a round of financing in which the tive due to investments, losses, and expenses, but as
investors are the same investors as the previous investments produce results the cash flow or returns
round. An inside round raises liability issues since trend upward. A graph of cash flow or returns versus
the valuation of the company has no third party veri- time would then resemble the letter “J”.
fication in the form of an outside investor. In addi-
tion, the terms of the inside round may be considered Later stage – the state of a company that has proven
self-dealing if they are onerous to any set of share- its concept, achieved significant revenues compared
holders or if the investors give themselves additional to its competition, and is approaching cash flow
preferential rights. break even or positive net income. Typically, a later
stage company is about 6 to 12 months away from a
Institutional investor – professional entities that liquidity event such as an IPO or buyout. The rate of
invest capital on behalf of companies or individuals. return for venture capitalists that invest in later stage,
Examples are: pension plans, insurance companies less risky ventures is lower than in earlier stage ven-
and university endowments. tures.
Intellectual property (IP) – knowledge, techniques, LBO – see Leveraged buyout.

writings and images that are intangible but often pro-
tected by law via patents, copyrights, and trademarks. Lead investor – the venture capital investor that
makes the largest investment in a financing round
Interest coverage ratio – earnings before interest and manages the documentation and closing of that
and taxes (EBIT) divided by interest expense. This is round. The lead investor sets the price per share of
a key ratio used by lenders to assess the ability of a the financing round, thereby determining the valua-
company to produce sufficient cash to pay its debt tion of the company.
obligation.
Letter of intent – a document confirming the intent
Internal rate of return (IRR) – the interest rate at of an investor to participate in a round of financing
which a certain amount of capital today would have for a company. By signing this document, the subject
to be invested in order to grow to a specific value at company agrees to begin the legal and due diligence
a specific time in the future. process prior to the closing of the transaction. Also
known as a “Term Sheet”.
Investment thesis / Investment philosophy – the
fundamental ideas which determine the types of Leverage – the use of debt to acquire assets, build
investments that an investment fund will choose in operations and increase revenues. By using debt, a
order to achieve its financial goals. company is attempting to achieve results faster than
if it only used its cash available from pre-leverage
IPEV – Stands for International Private Equity operations. The risk is that the increase in assets and
Valuation guidelines group. This group is made up of revenues does not generate sufficient net income and
representatives of the international and US venture cash flow to pay the interest costs of the debt.
68 Thomson Reuters
2013 NVCA Yearbook
Leveraged buyout (LBO) – the purchase of a com- Liquidation – the sale of a company. This may occur
pany or a business unit of a company by an outside in the context of an acquisition by a larger company
investor using mostly borrowed capital. or in the context of selling off all assets prior to ces-
sation of operations (Chapter 7 bankruptcy). In a liq-
Leveraged recapitalization – the reorganization of a uidation, the claims of secured and unsecured credi-
company’s capital structure resulting in more debt tors, bondholders and preferred stockholders take
added to the balance sheet. Private equity funds can precedence over common stockholders.
recapitalize a portfolio company and then direct the
company to issue a one-time dividend to equity Liquidation preference – the contractual right of an
investors. This is often done when the company is investor to priority in receiving the proceeds from the
performing well financially and the debt markets are liquidation of a company. For example, a venture
expanding. capital investor with a “2x liquidation preference”
has the right to receive two times its original invest-
Leverage ratios – measurements of a company’s ment upon liquidation.
debt as a multiple of cash flow. Typical leverage
ratios include Total Debt / EBITDA, Total Debt / Liquidity discount – a decrease in the value of a
(EBITDA minus Capital Expenditures), and Seniore private company compared to the value of a similar
Debt / EBITDA. but publicly traded company. Since an investor in a
private company cannot readily sell his or her invest-
L.I.B.O.R. – see The London Interbank Offered ment, the shares in the private company must be val-
Rate. ued less than a comparable public company.
License – a contract in which a patent owner grants Liquidity event – a transaction whereby owners of a
to a company the right to make, use or sell an inven- significant portion of the shares of a private compa-
tion under certain circumstances and for compensa- ny sell their shares in exchange for cash or shares in
tion. another, usually larger company. For example, an
IPO is a liquidity event.
Limited liability company (LLC) – an ownership
structure designed to limit the founders’ losses to the Lock-up agreement – investors, management and
amount of their investment. An LLC itself does not employees often agree not to sell their shares for a
pay taxes, rather its owners pay taxes on their propor- specific time period after an IPO, usually 6 to 12
tion of the LLC profits at their individual tax rates. months. By avoiding large sales of its stock, the com-
pany has time to build interest among potential buy-
Limited partnership – a legal entity composed of a ers of its shares.
general partner and various limited partners. The
general partner manages the investments and is liable London Interbank Offered Rate (L.I.B.O.R.) – the
for the actions of the partnership while the limited average rate charged by large banks in London for
partners are generally protected from legal actions loans to each other. LIBOR is a relatively volatile rate
and any losses beyond their original investment. The and is typically quoted in maturities of one month,
general partner collects a management fee and earns three months, six months and one year.
a percentage of capital gains (see Carried interest),
while the limited partners receive income, capital Management buyout (MBO) – a leveraged buyout
gains and tax benefits. controlled by the members of the management team
of a company or a division. Often an MBO is con-
Limited partner (LP) – an investor in a limited part- ducted in partnership with a buyout fund.
nership. The general partner is liable for the actions
of the partnership while the limited partners are gen- Management fee – a fee charged to the limited part-
erally protected from legal actions and any losses ners in a fund by the general partner. Management
beyond their original investment. The limited partner fees in a private equity fund usually range from
receives income, capital gains and tax benefits. 0.75% to 3% of capital under management, depend-
Thomson Reuters 69
ing on the type and size of fund. For venture capital type of anti-dilution mechanism. A weighted average
funds, 2% is typical. anti-dilution method adjusts downward the price per
share of the preferred stock of investor A due to the
Management rights – the rights often required by a issuance of new preferred shares to new investor B at
venture capitalist as part of the agreement to invest in a price lower than the price investor A originally
a company. The venture capitalist has the right to received. Investor A’s preferred stock is repriced to a
consult with management on key operational issues, weighed average of investor A’s price and investor B’s
attend board meetings and review information about price. A narrow-based anti-dilution uses only com-
the company’s financial situation. mon stock outstanding in the denominator of the for-
mula for determining the new weighted average
Market capitalization – the value of a publicly trad- price.
ed company as determined by multiplying the num-
ber of shares outstanding by the current price per NDA – see Non-disclosure agreement.
share.
No-shop clause – a section of an agreement to pur-
MBO – see Management buyout. chase a company whereby the seller agrees not to
market the company to other potential buyers for a
Mezzanine – a layer of financing that has intermedi- specific time period.
ate priority (seniority) in the capital structure of a
company. For example, mezzanine debt has lower Non-cumulative dividends – dividends that are
priority than senior debt but usually has a higher payable to owners of preferred stock at a specific
interest rate and often includes warrants. In venture point in time only if there is sufficient cash flow
capital, a mezzanine round is generally the round of available after all company expenses have been paid.
financing that is designed to help a company have If cash flow is insufficient, the owners of the pre-
enough resources to reach an IPO. See Bridge financ- ferred stock will not receive the dividends owed for
ing. that time period and will have to wait until the board
of directors declares another set of dividends.
MoneyTree™ Report – Officially known as The
MoneyTree Report from PricewaterhouseCoopers Non-interference – an agreement often signed by
and the National Venture Capital Association based employees and management whereby they agree not
on data provided by Thomson Reuters. This report to interfere with the company’s relationships with
provides much of the data in this report. It is used for employees, clients, suppliers and sub-contractors
investment statistics in United States based compa- within a certain time period after termination of
nies. Specific definition information is available in employment.
several of the appendices of this Yearbook.
Non-solicitation – an agreement often signed by
Multiples – a valuation methodology that compares employees and management whereby they agree not
public and private companies in terms of a ratio of to solicit other employees of the company regarding
value to an operations figure such as revenue or net job opportunities.
income. For example, if several publicly traded com-
puter hardware companies are valued at approxi- Non-disclosure agreement (NDA) – an agreement
mately 2 times revenues, then it is reasonable to issued by entrepreneurs to protect the privacy of their
assume that a startup computer hardware company ideas when disclosing those ideas to third parties.
that is growing fast has the potential to achieve a val-
uation of 2 times its revenues. Before the startup Offering memorandum – a legal document that pro-
issues its IPO, it will likely be valued at less than 2 vides details of an investment to potential investors.
times revenue because of the lack of liquidity of its See Private placement memorandum.
shares. See Liquidity discount.
OID – see Original issue discount.
Narrow-based weighted average anti-dilution – a
70 Thomson Reuters
2013 NVCA Yearbook
Operating cash flow – the cash flow produced from Piggyback rights – rights of an investor to have his or
the operation of a business, not from investing activ- her shares included in a registration of a startup’s
ities (such as selling assets) or financing activities shares in preparation for an IPO.
(such as issuing debt). Calculated as net operating
income (NOI) plus depreciation. PIK dividend – a dividend paid to the holder of a
stock, usually preferred stock, in the form of addi-
Option pool – a group of options set aside for long tional stock rather than cash. PIK refers to payment
term, phased compensation to management and in kind.
employees.
PIPEs – see Private investment in public equity.
Outstanding shares – the total amount of common
shares of a company, not including treasury stock, Placement agent – a company that specializes in
convertible preferred stock, warrants and options. finding institutional investors that are willing and
able to invest in a private equity fund. Sometimes a
Pay to play – a clause in a financing agreement private equity fund will hire a placement agent so the
whereby any investor that does not participate in a fund partners can focus on making and managing
future round agrees to suffer significant dilution investments in companies rather than on raising cap-
compared to other investors. The most onerous ver- ital.
sion of “pay to play” is automatic conversion to com-
mon shares, which in essence ends any preferential Portfolio company – a company that has received an
rights of an investor, such as the right to influence investment from a private equity fund.
key management decisions.
Post-money valuation – the valuation of a company
Pari passu – a legal term referring to the equal treat- including the capital provided by the current round of
ment of two or more parties in an agreement. For financing. For example, a venture capitalist may
example, a venture capitalist may agree to have reg- invest $5 million in a company valued at $2 million
istration rights that are pari passu with the other “pre-money” (before the investment was made). As a
investors in a financing round. result, the startup will have a post-money valuation
of $7 million.
Participating dividends – the right of holders of cer-
tain preferred stock to receive dividends and partici- PPM – see Private placement memorandum.
pate in additional distributions of cash, stock or other
assets. Preemptive rights – the rights of shareholders to
maintain their percentage ownership of a company by
Participating preferred stock – a unit of ownership buying shares sold by the company in future financ-
composed of preferred stock and common stock. The ing rounds.
preferred stock entitles the owner to receive a prede-
termined sum of cash (usually the original invest- Preference – seniority, usually with respect to divi-
ment plus accrued dividends) if the company is sold dends and proceeds from a sale or dissolution of a
or has an IPO. The common stock represents addi- company.
tional continued ownership in the company.
Participating preferred stock has been characterized Preferred return – a minimum return per annum
as “having your cake and eating it too”. that must be generated for limited partners of a pri-
vate equity fund before the general partner can begin
PEIGG – acronym for Private Equity Industry receiving a percentage of profits from investments.
Guidelines Group, an ad hoc group of individuals
and firms involved in the private equity industry for Preferred stock – a type of stock that has certain
the purpose of establishing valuation and reporting rights that common stock does not have. These spe-
guidelines. cial rights may include dividends, participation, liq-
uidity preference, anti-dilution protection and veto
Thomson Reuters 71
provisions, among others. Private equity investors professional money management which serves as a
usually purchase preferred stock when they make basis for the Prudent Investor Act. The principle is
investments in companies. based on a statement by Judge Samuel Putnum in
1830: “Those with the responsibility to invest money
Pre-money valuation – the valuation of a company for others should act with prudence, discretion, intel-
prior to the current round of financing. For example, ligence and regard for the safety of capital as well as
a venture capitalist may invest $5 million in a compa- income.” In the 1970s a favorable interpretation of
ny valued at $2 million pre-money. As a result, the this rule enabled pension fund managers to invest in
startup will have a “post-money” valuation of $7 mil- venture capital for the first time.
lion.
Qualified IPO – a public offering of securities val-
Primary shares – shares sold by a corporation (not ued at or above a total amount specified in a financ-
by individual shareholders). ing agreement. This amount is usually specified to be
sufficiently large to guarantee that the IPO shares
Private Equity Growth Capital Council (PEGCC) – will trade in a major exchange (NASDAQ or New
an advocacy, communications and research organiza- York Stock Exchange). Usually upon a qualified IPO
tion for the buyout industry in the United States. preferred stock is forced to convert to common stock.
Private equity – equity investments in non-public Quartile – one fourth of the data points in a data set.
companies, usually defined as being made up of ven- Often, private equity investors are measured by the
ture capital funds and buyout funds. Real estate, oil results of their investments during a particular period
and gas, and other such partnerships are sometimes of time. Institutional investors often prefer to invest
included in the definition. in private equity funds that demonstrate consistent
results over time, placing in the upper quartile of the
Private investment in public equity (PIPEs) – investment results for all funds.
investments by a private equity fund in a publicly
traded company, usually at a discount and in the form Ratchet – a mechanism to prevent dilution. An
of preferred stock. antidilution clause in a contract protects an investor
from a reduction in percentage ownership in a com-
Private placement – the sale of a security directly to pany due to the future issuance by the company of
a limited number of institutional and qualified indi- additional shares to other entities.
vidual investors. If structured correctly, a private
placement avoids registration with the Securities and Realization ratio – the ratio of cumulative distribu-
Exchange Commission. tions to paid-in capital. The realization ratio is used
as a measure of the distributions from investment
Private placement memorandum (PPM) – a docu- results of a private equity partnership compared to
ment explaining the details of an investment to poten- the capital under management.
tial investors. For example, a private equity fund will
issue a PPM when it is raising capital from institu- Recapitalization – the reorganization of a compa-
tional investors. Also, a startup may issue a PPM ny’s capital structure.
when it needs growth capital. Also known as
“Offering Memorandum”. Red herring – a preliminary prospectus filed with
the Securities and Exchange Commission and con-
Private securities – securities that are not registered taining the details of an IPO offering. The name
with the Securities and Exchange Commission and refers to the disclosure warning printed in red letters
do not trade on any exchanges. The price per share is on the cover of each preliminary prospectus advising
negotiated between the buyer and the seller (the potential investors of the risks involved.
“issuer”).
Redemption rights – the right of an investor to force
Prudent man rule – a fundamental principle for the startup company to buy back the shares issued as
72 Thomson Reuters
2013 NVCA Yearbook
a result of the investment. In effect, the investor has ROI – see Return on investment.
the right to take back his/her investment and may
even negotiate a right to receive an additional sum in Rollup – the purchase of relatively smaller compa-
excess of the original investment. nies in a sector by a rapidly growing company in the
Registration – the process whereby shares of a com- same sector. The strategy is to create economies of
pany are registered with the Securities and Exchange scale. For example, the movie theater industry under-
Commission under the Securities Act of 1933 in went significant consolidation in the 1960’s and
preparation for a sale of the shares to the public. 1970’s.
Regulation D – an SEC regulation that governs pri- Round – a financing event usually involving several
vate placements. Private placements are investment private equity investors.
offerings for institutional and accredited individual
investors but not for the general public. There is an Royalties – payments made to patent or copyright
exception that 35 non-accredited investors can partic- owners in exchange for the use of their intellectual
ipate. property.
Restricted shares – shares that cannot be traded in Rule 144 – a rule of the Securities and Exchange
the public markets. Commission that specifies the conditions under
which the holder of shares acquired in a private trans-
Return on investment (ROI) – the proceeds from an action may sell those shares in the public markets.
investment, during a specific time period, calculated
as a percentage of the original investment. Also, net S corporation – an ownership structure that limits its
profit after taxes divided by average total assets. number of owners to 100. An S corporation does not
pay taxes, rather its owners pay taxes on their propor-
Rights offering – an offering of stock to current tion of the corporation’s profits at their individual tax
shareholders that entitles them to purchase the new rates.
issue, usually at a discount.
SBIC – see Small Business Investment Company.
Rights of co-sale with founders – a clause in ven-
ture capital investment agreements that allows the Scalability – a characteristic of a new business con-
VC fund to sell shares at the same time that the cept that entails the growth of sales and revenues
founders of a startup chose to sell. with a much slower growth of organizational com-
plexity and expenses. Venture capitalists look for
Right of first refusal – a contractual right to partic- scalability in the startups they select to finance.
ipate in a transaction. For example, a venture capital-
ist may participate in a first round of investment in a Scale-down – a schedule for phased decreases in
startup and request a right of first refusal in any fol- management fees for general partners in a limited
lowing rounds of investment. partnership as the fund reduces its investment activi-
ties toward the end of its term.
Risk-free rate – a term used in finance theory to
describe the return from investing in a riskless secu- Scale-up – the process of a company growing quick-
rity. In practice, this is often taken to be the return on ly while maintaining operational and financial con-
US Treasury Bills. trols in place. Also, a schedule for phased increases
in management fees for general partners in a limited
Road show – presentations made in several cities to partnership as the fund increases its investment activ-
potential investors and other interested parties. For ities over time.
example, a company will often make a road show to
generate interest among institutional investors prior Secondary market – a market for the sale of lim-
to its IPO. ited partnership interests in private equity funds.
Sometimes limited partners chose to sell their
Thomson Reuters 73
interest in a partnership, typically to raise cash or form of debt or equity in order to use in private equi-
because they cannot meet their obligation to invest ty investing.
more capital according to the takedown schedule.
Certain investment companies specialize in buying Stock option – a right to purchase or sell a share of
these partnership interests at a discount. stock at a specific price within a specific period of
time. Stock purchase options are commonly used as
Secondary shares – shares sold by a shareholder long term incentive compensation for employees and
(not by the corporation). management of fast growth companies.
Securities and Exchange Commission (SEC) – the Strategic investor – a relatively large corporation
regulatory body that enforces federal securities laws that agrees to invest in a young or a smaller company
such as the Securities Act of 1933 and the Securities in order to have access to its proprietary technology,
Exchange Act of 1934. product or service.
Seed capital – investment provided by angels, Subordinated debt – a loan that has a lower priority
friends and family to the founders of a startup in seed than a senior loan in case of a liquidation of the asset
stage. or company. Also known as “junior debt”.
Seed stage – the state of a company when it has just Success rate – the proportion of venture funded
been incorporated and its founders are developing companies that are considered successful. A study of
their product or service. companies funded by VCs during the 1990s indicat-
ed that 14% of the companies went public and anoth-
Senior debt – a loan that has a higher priority in case er 11%were acquired.
of a liquidation of the asset or company.
Sweat equity – ownership of shares in a company
Seniority – higher priority. resulting primarily from work rather than investment
of capital.
Series A preferred stock – preferred stock issued by
a fast growth company in exchange for capital from Syndicate – a group of investors that agree to partic-
investors in the “A” round of financing. This pre- ipate in a round of funding for a company.
ferred stock is usually convertible to common shares Alternatively, a syndicate can refer to a group of
upon the IPO or sale of the company. investment banks that agree to participate in the sale
of stock to the public as part of an IPO.
Shareholder agreement – a contract that sets out,
for example, the basis on which the company will be Synthetic secondary – A popular method of com-
operated and the shareholders’ rights and obligations. pleting a direct secondary transaction in which the
It provides protection to minority shareholders. buyer becomes a limited partner (LP) in a special
purpose vehicle (SPV) or similar entity which has
Sharpe Ratio – a method of calculating the risk- been set up out of the underlying investments in order
adjusted return of an investment. The Sharpe Ratio is to create a limited partnership interest. The term
calculated by subtracting the risk-free rate from the arose because of the synthetic nature of the direct
return on a specific investment for a time period purchase through the LP secondary transaction.
(usually one year) and then dividing the resulting fig-
ure by the standard deviation of the historical (annu- Tag-along right – the right of a minority investor to
al) returns for that investment. The higher the Sharpe receive the same benefits as a majority investor.
Ratio, the better. Usually applies to a sale of securities by investors.
Also known as Co-sale right.
Small Business Investment Company (SBIC) – a
company licensed by the Small Business Takedown – a schedule of the transfer of capital in
Administration to receive government capital in the phases in order to complete a commitment of funds.
74 Thomson Reuters
2013 NVCA Yearbook
Typically, a takedown is used by a general partner of er than public stock return rates, representing the fact
a private equity fund to plan the transfer of capital that venture capitalists must achieve significant
from the limited partners. returns on investment in order to compensate for the
risks they take in funding unproven companies.
Tender offer – an offer to public shareholders of a
company to purchase their shares. Vesting – a schedule by which employees gain own-
ership over time of a previously agreed upon amount
Term loan – a bank loan for a specific period of of retirement funding or stock options.
time, usually up to ten years in leveraged buyout
structures. Vintage – the year that a private equity fund stops
accepting new investors and begins to make invest-
Term sheet – a document confirming the intent of an ments on behalf of those investors. Venture funds are
investor to participate in a round of financing for a generally benchmarked to funds of the same vintage
company. By signing this document, the subject com- year.
pany agrees to begin the legal and due diligence
process prior to the closing of the transaction. Also Voting rights – the rights of holders of preferred and
known as “Letter of Intent”. common stock in a company to vote on certain acts
affecting the company. These matters may include
Tranche – a portion of a set of securities. Each payment of dividends, issuance of a new class of
tranche may have different rights or risk characteris- stock, merger or liquidation.
tics. When venture capital firms finance a company,
a round may be disbursed in two or three tranches, Warrant – a security which gives the holder the right
each of which is paid when the company attains one to purchase shares in a company at a pre-determined
or more milestones. price. A warrant is a long term option, usually valid
for several years or indefinitely. Typically, warrants
Turnaround – a process resulting in a substantial are issued concurrently with preferred stocks or
increase in a company’s revenues, profits and reputa- bonds in order to increase the appeal of the stocks or
tion. bonds to potential investors.
Under water option – an option is said to be under Washout round – a financing round whereby previ-
water if the current fair market value of a stock is less ous investors, the founders and management suffer
than the option exercise price. significant dilution. Usually as a result of a washout
round, the new investor gains majority ownership and
Underwriter – an investment bank that chooses to control of the company.
be responsible for the process of selling new securi-
ties to the public. An underwriter usually chooses to Weighted average cost of capital (WACC) – the
work with a syndicate of investment banks in order to average of the cost of equity and the after-tax cost of
maximize the distribution of the securities. debt. This average is determined using weight factors
based on the ratio of equity to debt plus equity and
Venture capital – a segment of the private equity the ratio of debt to debt plus equity.
industry which focuses on investing in new compa-
nies with high growth potential and accompanying Weighted average anti-dilution – an anti-dilution
high risk. protection mechanism whereby the conversion rate of
preferred stock is adjusted in order to reduce an
Venture capital method – a pricing valuation investor’s loss due to an increase in the number of
method whereby an estimate of the future value of a shares in a company. Without anti-dilution protection,
company is discounted by a certain interest rate and an investor would suffer from a reduction of his or her
adjusted for future anticipated dilution in order to percentage ownership. Usually as a result of the imple-
determine the current value. Usually, discount rates mentation of a weighted average anti-dilution, compa-
for the venture capital method are considerably high- ny management and employees who own a fixed
Thomson Reuters 75
amount of common shares suffer significant 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 sufficient revenues
and cash flow to maintain its operations without sig-
nificant growth. Sometimes referred to as “walking
dead.” Typically, a venture capitalist has to make a
difficult decision as to whether to liquidate a zombie
or continue to invest funds in the hopes that the zom-
bie will become a winner.
These definitions were graciously provided by the

Center for Private Equity and Entrepreneurship at the
Tuck School of Business at Dartmouth. Please refer
to the Center’s website for additional definitions and
information at http://mba.tuck.dartmouth.edu/-
pecenter/resources/glossary.html. Used by permis-
sion. Thomson Reuters and National Venture Capital
Association are grateful to the Center for its support.
76 Thomson Reuters
Appendix B: MoneyTree Report Criteria
PricewaterhouseCoopers/National Venture Capital Association
MoneyTree™ Report, Data: Thomson Reuters
The MoneyTree Report is a quarterly study of ven- sional venture capital firms with or without a US
ture capital investment activity in the United States. office, SBICs, venture arms of corporations, institu-
As a collaboration between PricewaterhouseCoopers tions, investment banks and similar entities whose
and the National Venture Capital Association, based primary activity is financial investing. Where there
upon data from Thomson Reuters, it is the only are other participants such as angels, corporations,
industry-endorsed research of its kind. The and governments in a qualified and verified financ-
MoneyTree Report is the definitive source of infor- ing round the entire amount of the round is included.
mation on emerging companies that receive financ- Qualifying transactions include cash investments by
ing and the venture capital firms that provide it. The these entities either directly or by participation in
study is a staple of the financial community, entre- various forms of private placement. All recipient
preneurs, government policymakers and the business companies are private, and may have been newly-cre-
press worldwide. ated or spun-out of existing companies.
The report excludes debt, buyouts, recapitalizations,
secondary purchases, IPOs, investments in public
Report Criteria
companies such as PIPES (private investments in
The MoneyTree™ Report records cash for equity public entities), investments for which the proceeds
investments as the cash is actually received by the are primarily intended for acquisition such as roll-
company (also called a tranche) as opposed to when ups, change of ownership, and other forms of private
financing is committed (often referred to as a “term equity that do not involve cash such as services-in-
sheet”) to a company. Accordingly, the amount kind and venture leasing.
reported in a given quarter may be less than the total Investee companies must be domiciled in one of the
round amount committed to the company at the time 50 US states or DC even if substantial portions of
when the round of financing closed. their activities are outside the United States.
The type of financing as it is used in the
MoneyTree™ Report refers to the number of tranch-
Specific Methodology
es a company has received. The number designation
(1, 2, 3, etc.) does not refer to the round of financing. The focus of the report is on cash received by the
Rounds are usually designated alphabetically, e.g. company. Therefore, tranches not term sheets are the
Series A, Series B, and so on. The MoneyTree™ determining factor. Drawdowns on commitments are
Report does not track rounds. 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
Summary Description
and bridge loans are recognized only when converted
The MoneyTree™ Report measures cash-for-equity to equity.
investments by the professional venture capital com- Once a company has received a qualifying venture
munity in private emerging companies in the U.S. It capital financing round, all subsequent equity financ-
is based on data provided by Thomson Reuters. ing rounds are included regardless of whether the
round involved a venture capital firm as long as all
other investment criteria are met (e.g. cash-for-equi-
General Definition
ty, not buyout or services in kind).
The report includes the investment activity of profes- Angel, incubator and similar investments are consid-
Thomson Reuters 77
ered pre-venture financing if the company has Reuters. Information is augmented by other research
received no prior qualifying venture capital invest- techniques including other public and private
ment and are not included in the MoneyTree™ sources. All data is subject to verification with the
results. Angel, incubator and similar investments that venture capital firms and/or the investee companies.
are part of a qualifying venture capital round or fol- Only professional independent venture capital firms,
low a qualifying venture capital round are included to institutional venture capital groups, and recognized
the extent that such investments can be fully verified corporate venture capital groups are included in ven-
as meeting all other criteria (e.g. cash for equity, not ture capital industry rankings.
buyout or services in kind).
Direct investment by corporations (not through a cor-
Disclaimer
porate venture capital arm) is excluded unless (a) the
investment is clearly demonstrated to be primarily a PricewaterhouseCoopers and the National Venture
financial investment rather than outsourced R&D or Capital Association have taken responsible steps to
market development, (b) it is a co-investment in an ensure that the information contained in the
otherwise qualifying round, or (c) it follows a quali- MoneyTree™ Report has been obtained from reli-
fying venture round in a company and meets all other able sources. However, neither of the parties nor
criteria (e.g. cash-for-equity, not buyout or services Thomson Reuters can warrant the ultimate validity of
in kind). the data obtained in this manner. Results are updated
Data is primarily obtained from a quarterly survey of periodically. Therefore, all data is subject to change
venture capital practitioners conducted by Thomson at any time.
78 Thomson Reuters
2013 NVCA Yearbook
Thomson Reuters 79
80 Thomson Reuters
Appendix C: MoneyTree Geographical
Definitions
The Geographical Regions identified 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 Northwest: Washington, Oregon, Idaho, Montana,
Puerto Rico and Wyoming
Colorado: The state of Colorado Philadelphia Metro: Eastern Pennsylvania, south-

ern New Jersey, and Delaware
DC/Metroplex: Washington, D.C., Virginia, West
Virginia, and Maryland Sacramento/Northern California: Northeastern
California
LA/Orange County: Los Angeles, Ventura, Orange,
and Riverside Counties (i.e., southern California, San Diego: San Diego area
except San Diego)
Silicon Valley: Northern California, bay area and
Midwest: Illinois, Missouri, Indiana, Kentucky, coastline
Ohio, Michigan, and western Pennsylvania
South Central: Kansas, Oklahoma, Arkansas, and
New England: Maine, New Hampshire, Vermont, Louisiana
Massachusetts, Rhode Island, and parts of
Connecticut (excluding Fairfield county) Southeast: Alabama, Florida, Georgia, Mississippi,
Tennessee, South Carolina, and North Carolina
New York Metro: Metropolitan NY area, northern
New Jersey, and Fairfield County, Connecticut Southwest: Utah, Arizona, New Mexico, and Nevada
Texas: The state of Texas
North Central: Minnesota, Iowa, Wisconsin, North
Dakota, South Dakota, and Nebraska Upstate New York: Northern New York state, except
Metropolitan New York City area
Thomson Reuters 81
82 Thomson Reuters
Appendix D: Industry Codes (VEIC)
Company VE Primary Company VE Primary Company VE Primary Company VE Primary
Industry Class Industry Sub-Group 1 Industry Sub-Group 2 Industry Sub-Group 3
1000 Information Technology 1000 Communications 1100 Commer. Comm. 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
1700 Media and Entertainment
1710 Entertainment
1720 Publishing
1800 Other Communications Related
1200 Telephone Rel. 1200 Telecommunications
1210 Long Distance Telephone Services
1215 Local Exchange Carriers (LEC)
1220 Telephone Interconnect & Other Equipment
1230 Telephone answering and/or
management systems, PBXs
1299 Other Telephone Related
1300 Wireless Communications 1300 Wireless Communications
1310 Mobile Communications, Pagers & Cellular
Radio
1320 Wireless Communications Services
1325 Messaging Services
1330 Wireless Communications Components
1399 Other Wireless Communications
1400 Facsimile Trans 1400 Facsimile Transmission
1500 Data Comm. 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 equipment
1549 Other Data Communications
1600 Satellite Comm 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
1800 Comm. Other 1810 Defense Communications
1825 Other Communications Services NEC
1899 Other Communications Products (not yet
classified)
2100 Computer Hardware 2100 Computers Hardware 2100 Computers and Hardware
2110 Mainframes & Scientific Computers
2111 Mainframes
2112 Supercomputers and Scientific Computers
2119 Other Mainframes and Scientific
Thomson Reuters 83
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
2143 Workstations
2144 Thin Client Hardware
2149 Other Servers and Workstations
2200 Digital Imaging and 2200 Computer Graphics and Digital Imaging
Computer Graphics
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 Turnkey Integrated Systems 2300 Integrated Turnkey Systems and Solutions
and Solutions
2311 Business and Office
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/Servcies
2323 Education
2324 Reference
2325 Scientific
2399 Other Intergrated Systems and Solutions
2500 Computer Peripherals 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
84 Thomson Reuters
2013 NVCA Yearbook
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. semiconductors)
2561 PC or PMCIA cards
2562 Memory Cards
2563 Sound Cards
2564 Communications Cards
2569 Other Peripheral Cards
2590 Other Peripherals (not yet classified)
2700 Computer Software 2600 Computer Services 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 management
2699 Other Computer Services
2700 Computer Software 2700 Computer Software
2710 Systems Software
2711 Database & File Management
2712 Operating Systems & Utilities
2713 Program Development
Tools/CASE/Languages
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 Office 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 Scientific Software
2743 Agricultural Software
2744 Transportation Software
2748 Other Industry specific Software
2749 Other Applications Software
2750 Artificial Intelligence Related Software
Thomson Reuters 85
2751 Expert Systems
2752 Natural Language
2753 Computer-Aided Instruction
2754 Artificial Intel. Programming Aids
2755 Other Artificial Intelligence Related
2799 Other Software Related
2710 Computer Programming 2760 Software Services
2761 Programming Services/Systems
Engineering
2762 Software Consulting Services
2763 Software Distribution/Clearinghouse
2769 Other Software Services
2800 Internet Specific 1550 Internet Communications 1550 Internet Communications and
Infrastructure 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 1560 E-Commerce Technology
1561 Internet Security and Transaction Services
1562 Ecommerce Services
1569 Other Ecommerce
2100 Computers Hardware 2142 Web Servers
2780 Internet Software 1563 Ecommerce Enabling Software
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
2785 Internet Programming 2765 Internet/Web Design and programming
services
2766 Internet Graphics Services
2768 Other Internet Software Services
2800 Internet Ecommerce 2800 Internet and Online Related
2810 E-Commerce—Selling products Online or
Internet
2811 Business and Office 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 Scientific Products
2826 Legal Products
2829 Other Ecommerce Selling Products
2830 Eccommerce—Selling Services
Online/Internet
2831 Business and Office Services
2832 Consumer Services
2833 Retailing Services
86 Thomson Reuters
2013 NVCA Yearbook
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 Scientific
2846 Legal
2848 Recreation/Entertainment Services
2849 Other Ecommerce Selling Services
2810 Internet Content 2850 Web Aggregration/Portal Sites/Exchanges
2851 Business and Office 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 Scientific Info/Content
2866 Legal Info/Content
2869 Other Aggregation/Portal/Exchange Sites
2820 Internet Services 2870 Internet Services
2871 Internet Marketing Services
2873 Data Warehousing Services
2879 Other Internet and Online Services NEC
2900 Computer Other 2900 Computer Other 2000 Computer Related
2900 Other Computer Related
2910 Voice Synthesis
2911 Voice Recognition
2990 Other Computer Related (not yet classified)
3000 Semiconductor/Electr 3100 Semiconductors/Other 3100 Electronic Components
Electronics
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
3200 Batteries 3200 Batteries
3300 Power Supplies 3300 Power Supplies
3310 Uninterruptible Power Supply (UPS)
3400 Electronics Equipment 3400 Electronics Related Equipment
Thomson Reuters 87
3410 Semiconductor Fabrication Equip. & Wafer
Products
3420 Component Testing Equipment
3499 Other Electronics Related Equipment
3500 Laser Related 3500 Laser Related
3510 Laser Components (incl. beamsplitters,
excimers)
3599 Other Laser Related
3600 Fiber Optics 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 Scientific Instrumentation 3700 Analytical & Scientific Instrumentation
3710 Chromatographs & Related Laboratory
Equipment
3720 Other Measuring Devices
3799 Other Analytical & Scientific
Instrumentation
3800 Electronics, Other 3000 Other Electronics Related
3170 Other Electronics Related (including
keyboards)
3800 Other Electronics Related
3810 Military Electronics (excluding
communications)
3820 Copiers
3830 Calculators
3835 Security/Alarm/Sensors
3899 Other Electronics Related (incl. alarm
systems)
3900 Optoelectronics 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 Medical/Health/Life Science 4000 Biotechnology 4100 Biotech-Human 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. hormones
& TPA)
4129 Other Therapeutic Biotechnology
4130 Genetic Engineering
4200 Biotech-Animal 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 & Nutrition
Products
4250 Genetically Engineered Animals
88 Thomson Reuters
2013 NVCA Yearbook
4290 Other Animal Related Biotechnology
4300 Biotech-Industrial 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 1
Applications
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
Control
4340 Biotech Processes for Enhanced Oil
Recovery/Mining
4390 Other Industrial Biotechnology
4400 Biosensors 4400 Biosensors
4410 Biosensors for Medical Diagnostic
Applications
4420 Biosensors for Industrial Applications
4490 Other Biosensors
4500 Biotech Equipment 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 Research 4600 Biotech Related Research & Other Services
4610 Pure & Contract Biotechnology Research
4699 Other Biotechnology Services
4700 Biotech Other 4000 Biotechnology and Pharmacology
4900 Other Biotechnology Related
5000 Medical/Health 5100 Medical Diagnostics 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 5200 Medical Therapeutics
5210 Therapeutic Services
5220 Surgical Instrumentation & Equipment
5221 Surgical lasers (including laser delivery fibers)
5230 Pacemakers & Artificial Organs
5240 Drug Delivery & Other Equipment
5299 Other Therapeutic (including defibrillators)
5300 Med/Health Products 5000 Medical/Health Related
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)
Thomson Reuters 89
5400 Med/Health Services 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 Pharmaceutical 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 Non-High Technology 7000 Consumer Related 7100 Entertainment and Leisure 7100 Entertainment and Leisure
7110 Movies,Movie Products & Theater Operations
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 7200 Retailing Related
7210 Drug Stores
7220 Clothing and Shoe Stores
7230 Discount Stores
7240 Computer Stores
7245 Retail Publishing (books, magazines, news-
papers)
7246 Office Supply Stores
7247 Music/Electronics
7248 Specialty Department and retail stores
7250 Franchises(NEC)
7299 Other Retailing Related
7300 Food and Beverage 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 7400 Consumer Products
7410 Clothing,Shoes & Accessories (incl. jewelry)
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 7500 Consumer Services
7510 Fast Food Restaurants
90 Thomson Reuters
2013 NVCA Yearbook
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
7600 Consumer, Other 7000 Consumer Related
7999 Other Consumer Related (not yet classified)
8000 Industrial/Energy 3100 Semiconductors/Other 8141 Semiconductor Materials (eg. silicon
Electronics wafers)
8142 III/V Semiconductor Mater. (eg. gallium
arsenide)
6100 Oil & Gas Exploration 6100 Oil & Gas Exploration and Production
6200 Oil & Gas Exploration Services
6300 Oil & Gas Drilling & Support Services
6400 Oil & Gas Drilling,Exploration & Extraction
Equip.
6410 Oil & Gas Drilling & Extraction Equipment
6420 Oil & Gas Drilling Instrumentation
6430 Oil & Gas Exploration Equip.
Instrumentation
6499 Other Oil & Gas (NEC)
6500 Energy, Alternative 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 Energy, Enhanced Recovery 6600 Enhanced Oil Recovery/Heavy Oil/Shale
6700 Energy, Coal 6700 Coal Related
6710 Coal Mining
6720 Coal Related Equipment
6799 Other Coal Related
6800 Energy, Conservation 6800 Energy Conservation Related
6900 Energy, Other 6000 Energy Related
6900 Other Energy Related
8100 Chemicals and Materials 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
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
Thomson Reuters 91
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
classified)
8200 Industrial Automation 8200 Industrial Automation
8210 Energy Management
8220 Industrial Measurement & Sensing Equipment
8221 Laser related measuring & sensing equipment
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 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 (generators
& motors)
8399 Other Industrial Equipment & Machinery
8500 Pollution and Recycling 8500 Environmental Related
8510 Air Filters & Air Purification & Monitoring
Equip.
8520 Chemical and Solid Material Recycling
8530 Water Treatment Equipment & Waste
Disposal Systems
8599 Other Environmental Related
8600 Industrial Products, Other 8000 Industrial Products
8600 Other Industrial Products (not yet classified)
8700 Industrial Services 8700 Industrial Services
9100 Transportation 9100 Transportation 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 Airfield and Other Transportation Services
9180 Advanced Aircraft/Aerospace
9199 Other Transportation
9200 Financial Services 9200 Financial Services 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
92 Thomson Reuters
2013 NVCA Yearbook
9299 Financial Services, 0ther
9300 Business Serv. 9300 Business Services 9300 Services
9310 Engineering Services
9320 Advertising and Public Relations
9330 Leasing (not elsewhere classified)
9340 Distributors,Importers and Wholesalers
9350 Consulting Services
9360 Media Related Services
9399 Other Services NEC
9400 Manufact. 9400 Manufacturing 9400 Product Manufacturing
9410 Business Products and Supplies
9415 Office Automation Equipment
9420 Office 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
classified)
9500 Agr/Forestr/Fish 9500 Agricultural, Forestry 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 9700 Construction 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 9800 Utilities 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 9900 Other 9000 Other Services and Manufacturing
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
Thomson Reuters 93
94 Thomson Reuters
Appendix E: Industry Sector
VEIC Ranges
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, Media and
Entertainment, Medical Devices and Equipment, Networking and Equipment, Retailing/Distribution,
Semiconductors, Telecommunications and Other. These sectors are based on the 17 industry classifications 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
Electronics/Instrumentation
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
Thomson Reuters 95
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
Media and Entertainment

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
Networking and Equipment

1400, 1500, 1510, 1515, 1520, 1521, 1522, 1523, 1524, 1525, 1530, 1549, 3600, 3610, 3620, 3630, 3699
Retailing/Distribution
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
96 Thomson Reuters
Appendix F: Stage Definitions
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 develop-
ing a business plan, if the initial steps are successful. This is a pre-marketing stage.
EARLY STAGE FINANCING

This stage provides financing 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 firms 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 profit. Some of the uses of
capital may include further plant expansion, marketing, working capital, or development of an improved prod-
uct. More institutional investors are more likely to be included along with initial investors from previous
rounds. The venture capitalist’s 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 grow-
ing as fast as the rates attained in the expansion stages. Again, these companies may or may not be profitable,
but are more likely to be than in previous stages of development. Other financial characteristics of these com-
panies include positive cash flow. 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 firm.
ACQUISITION FOR EXPANSION

Funds provided to a company to finance its acquisition of other companies or assets. A consolidator of com-
panies in specific industries.
MANAGEMENT/LEVERAGED BUYOUT
These funds enable an operating management group to acquire a product line or business, at any stage of devel-
opment, 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 significant equity interest.
Thomson Reuters 97
RECAP/TURNAROUND
Financing provided to a company at a time of operational or financial difficulty with the intention of improv-
ing the company’s performance.
SECONDARY BUYOUT
A buyout deal on top of a buyout deal. Secondary buyouts are distinguished when the initial firm investor is
different from the current investing firm.
98 Thomson Reuters
Appendix G: Data Sources and Resources
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 official 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 Thomson Reuters, ThomsonONE.com contains investment, fund raising, portfolio company information,
and Reuters News along with other statistical data. Over 1.1 million global private companies can be analyzed
within ThomsonONE.com, including historical revenue figures on over 450,000 companies and detailed finan-
cials on over 160,000 companies with up to a five year history. Through a partnership with VC Experts.com, Inc.
the historical breadth and depth of the Thomson Reuters venture capital content is integrated with private com-
pany valuation and deal terms. ThomsonONE.com includes blogs, events, and articles from the peHUB and the
Venture Capital Journal, two of the industry’s 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 pro-
vide the most up-to-date and comprehensive global private equity statistics and profile information available.
Data Sources and Resources plete and accurate information.

MoneyTree™ Data
PricewaterhouseCoopers, Thomson Reuters, and the Timeliness of Data
National Venture Capital Association joined forces in Many of the tables and charts presented in this report
December 2001 to produce what was then known as can be produced by using ThomsonONE.com. One of
the PricewaterhouseCoopers/Thomson Venture advantages of using ThomsonONE.com is that the
Economics/National Venture Capital Association reader can customize a report to better fit the needs of
MoneyTree™ Survey. Conducted on a quarterly what they are seeking. In addition, because the online
basis, the designated PwC/NVCA MoneyTree Report database is continuously updated, the information
allows Thomson Reuters unparalleled access to pri- available is more up-to-date than what can be present-
mary sources of information from general partners. ed in this report. Readers should note that timely indus-
try information on details concerning venture capital
investment is available from other sources such as
Sources of Data PricewaterhouseCoopers at www.pwcmoneytree.com,
The online database of Thomson Reuters is the ‘Industry Stats’ section of the NVCA website,
ThomsonONE.com (VentureXpert), the foremost www.nvca.org, and the Private Equity section of
information provider for private equity professionals Thomson Reuters’ Deals Intelligence found at
worldwide. The private equity portion of Thomson http://dmi.thomsonreuters.com/PrivateEquity
Reuters offers an incomparable range of products from
directories to conferences, journals, newsletters,
research reports, and the ThomsonONE.com Private Verification and Updating of Data
Equity database. As of March 2013, the database Collectively, PricewaterhouseCoopers, Thomson
included over 107,000 portfolio companies, over 18,000 Reuters, and the NVCA have the utmost commitment
private equity firms, nearly 41,000 private equity funds, to provide an accurate historical record of venture
and over 235,000 financing rounds. By establishing capital activity. On a daily basis, the database is con-
working relationships with private equity and venture stantly analyzed for consistency, crosschecked with
capital firms, institutional investors, and industry asso- other data sources, and updated as new information
ciations such as the NVCA, PricewaterhouseCoopers comes in. On a quarterly basis, we have worked with
and other such entities around the world, Thomson many venture firms to ensure that that their current
Reuters has been able to gather, on a timely basis, com- and past data is correct. Primarily for this reason, the
Thomson Reuters 99
private equity news releases of Thomson Reuters will • In 2012, how much money was invested at each devel-
often restate statistics from prior news releases. With opment stage in Research Triangle Pharmaceutical
the availability of the online data access, users are companies?
encouraged to always use the most current numbers
even regarding historical activity so as to maintain In addition, there are also advantages of using the
accuracy and comparability. database for a general partner as well. Although this
is not an inclusive list, utilizing the database by gen-
eral partners can be helpful to them for among the
Reporting Functionality of following reasons:
ThomsonONE.com • Plan your companies’ exits with data on both ven-
Users can access information in terms of profiles on ture-backed IPOs and mergers and acquisitions
private equity companies, funds, firms, executives, • Aid in recruiting talented executives from other
IPOs, and limited partners. In addition, users can venture-backed companies
access the analytics portion of the database, which • Quickly spot venture-backed companies in compe-
contains investment, valuation, PE backed exits, fund tition with your own portfolio companies
performance, and fund raising information along • Create industry analyses to benchmark both per-
with venture capital information such as aggregate formance and portfolio investments
fund raising, and investments. Thomson Reuters On • Find other venture capitalists likely to support fol-
Demand is a service offering that caters to Financial low- on rounds
& Risk clients. With access to virtually all F&R con- • Provide clarity to investment decisions by compar-
tent sets, users of the service offering can order ing them to current market conditions
reports and analysis as needed. • Compile valuation reports for comparable portfolio
companies
• Identify prospective investors and their investment
Comprehensiveness of histories
ThomsonONE.com • Benchmark valuations among recent transactions
Both the breadth and depth of ThomsonONE.com and obtain valuation comparables
can perhaps best be shown in that it, among other • Analyze investment trends by industry
types of information, the user can find the answers to • Utilize returns information to limited partners using
the following questions: appropriate benchmarks
• Which venture firms actively co-invest with a firm • Tailor your pitch to investor focus size and limited
I am considering co-investing with? partner type
• Which venture firms are most active in funding online
financial services companies in the Ohio Valley?
• What does Yearbook Figure 3.15 look like for just Accessing ThomsonONE.com and Other
biotech? Services
• How much money was raised by each fund stage in For more information on ThomsonONE.com, please
2012? visit http://thomsonreuters.com/products_services/-
• What was a particular venture-backed IPO’s one financial/financial_products/deal_making/privat-
year return at the end of 2012? e_equity/private_equity_venture_capital/ or by
• As of December 2012, was the 10-year return to small phone at 1-800-782-5555. For information on NVCA
buyout funds larger than that of large buyout funds? membership, which can include a free trial and dis-
• Who are the most active acquirers of ecommerce counts on an annual subscription, please contact
security companies? Janice Mawson at the NVCA. You may contact her
• How much money was committed to mezzanine online through the link on the member benefits sec-
funds from 1997 to 2012? tion of the NVCA website or at 703-524-2549. For
• How much money was invested in the venture cap- information on services PricewaterhouseCoopers
ital industry from 1987 to 2012? provides for venture capital firms as well as emerg-
• What is the performance at quarter end for private ing companies, please visit their website at
equity funds that were formed from 1998 to 2012? www.pwcmoneytree.com.
100 Thomson Reuters

Appendix H: International Convergence
During 2012, the discussions and work focused on moving toward one high quality set of standards for finan-
cial 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 modification 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;
• FASB’s parent, the Financial Accounting Foundation, created a new Private Company Council (PCC)
to advise on private company accounting. Their work is just beginning;
• The AICPA is considering whether the PCC will provide an appropriate framework for private compa-
nies or if the AICPA should continue with efforts to develop an alternative non-GAAP basis of account-
ing for private companies;
• The International Accounting Standards Board (IASB) modified IFRS consolidation rules to effective-
ly 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 cept of convergence. In early September 2008, the
international rules become accepted as SEC and the FASB announced steps to pave the way
U.S. GAAP? for United States public companies to convert from
For years, the United States has been developing gen- U.S. GAAP to IFRS. The SEC “roadmap” provided
eralized accounting principles referred to as for a three-year run-up to an SEC “go-no go” deci-
Generally Accepted Accounting Principles sion in 2011, but the decision was deferred. At about
(“GAAP”). The keeper/arbiter/decider of GAAP is the same time, the FASB and the IASB met to review
the Financial Accounting Standards Board (“FASB”). and re-orient their convergence plan to be consistent
The FASB develops and updates GAAP and the SEC with the SEC’s proposed schedule. The 2008-2009
has adopted these accounting rules for public compa- world financial crisis deferred and deprioritized
ny reporting and other situations over which the SEC much of the work in this area.
has jurisdiction. In recent years, on a parallel track, a
separate set of rules emerged from the International The SEC’s 2012 staff report on adopting IFRS did
Accounting Standards Board (“IASB”), which was not make a recommendation, but raised questions
Europe-centric. These rules became known as the about consistent application, transparency, reliability,
International Financial Reporting Standards (“IFRS,” relevance, comparability, and ongoing costs in addi-
pronounced “EYE-fers”). IFRS has now been adopt- tion to any conversion costs, which might be signifi-
ed by most developed and many developing countries cant. More relevant to the United States venture cap-
around the world, with the exception of the United ital industry are matters specifically affecting fund
States. reporting, the financial statements provided by GPs
to LPs under the eventual rules. Because of the recent
Over recent years, a large number of multinational change in IFRS consolidation rules, United States
corporations complained that they had to endure venture capital firms would conceptually not be
keeping two sets of books and this prompted the con- impacted by a change to IFRS.
Thomson Reuters 101

How United States GAAP and or IFRS, in almost all cases, must report their LP
International IFRS Compare – Never fund positions on a Fair Value basis. LPs are increas-
ingly awakening to the specific conditions outlined in
Generalize
a change to U.S. GAAP from 2009, which codified
Even viewed from 30,000 feet, it is difficult to gen- an LP’s ability to use Net Asset Value (NAV) as an
eralize on how the two systems compare. First, while LP’s estimate of the Fair Value of their fund interest.
the IASB produces plain vanilla IFRS standards, These conditions include that the LP must satisfy
there is no one flavor of IFRS in use. Much like the themselves that the GP reported NAV is based on the
original UNIX kernel, each country/jurisdiction has Fair Value of underlying investments, that NAV is
been able to create its own version of IFRS. But “in-phase” (no time lag, unless deemed insignifi-
unlike UNIX, sometimes the differences among the cant), and that the LP interest is in a fund as defined
localized IFRS versions are large. So apples-to by ASC Topic 946. If these three conditions are not
apples comparison of “IFRS-compliant” financials met, or if the LP chooses not to use NAV, then Fair
from different jurisdictions can be difficult. Second, Value would be determined using other techniques.
it is true that IRFS itself is a very thin document The point here for GPs is that LPs need robustly
compared to GAAP, which has grown to roughly a determined Fair Value on a timely basis, generally at
two-foot stack of written rules. However, to imple- least quarterly.
ment IFRS, you need the implementation guide that
combines with the original document to create its
How the Same Words have Different
own two-foot stack. Again, much of the surface com-
parisons are not useful. Until now, United States ven-
Meanings
ture capital firms have been using U.S. GAAP The 2012 change in IFRS consolidation rules for
accounting standards exclusively. Investment Entities and the 2011 adoption of a com-
mon definition of Fair Value for U.S. GAAP and
While seemingly distant from the United States ven- IFRS should have created a framework where finan-
ture capital industry, it is important that all business cial reporting to investors would be identical for
constituencies weigh in on which system (current funds using IFRS and funds using U.S. GAAP. If it
U.S. GAAP vs. International vs. neither) is the best were only that easy!
system overall for the United States business com-
munity going forward. While we enter 2013 with a consistent framework
under U.S. GAAP and IFRS where venture capital
and private equity funds report all investments at Fair
GP-to LP Reporting – Can Meaningful
Value; and while we now have an identical definition
Statements Continue? of Fair Value (the amount a market participant would
A key priority for the United States venture capital pay in an orderly transaction), schisms are develop-
industry is being able to continue producing quarter- ing.
ly financial statements using investment company
(IC) accounting. Virtually all LP agreements (or Because of nuances in the way IFRS is drafted, IFRS
accompanying documents) require GPs to provide auditors are questioning whether Fair Value should
GAAP-compliant financial reports to LPs. Annual be determined based on the “investment” or on a
audits include testing to ensure GAAP compliance. “single share” basis. While the reasons for such a
Under GAAP, the United States venture capital question are beyond the scope of this document, the
industry now provides Fair Value portfolio reports question and potential results could mean that IFRS
under the special rules of “investment company and U.S. GAAP, though identical in principle, would
reporting.” In 2012, IFRS was modified to effective- result in different Fair Value estimates (as an aside,
ly create a financial reporting framework substantial- this is an example of one situation that concerns the
ly similar to U.S. GAAP. SEC in moving the United States towards IFRS).
GP’s should not lose sight of the fact their LP’s who At the same time, many auditors of U.S. GAAP, as a
prepare financial statements using either U.S. GAAP reaction to their regulators the PCAOB, and because
102 Thomson Reuters

2013 NVCA Yearbook
of pressure from the SEC, which now regulates pri- In December 2012, the International Private Equity
vate equity funds, are questioning whether or not the & Venture Capital Valuation (IPEV) Board updated
sale or exit of an enterprise can be assumed when its Valuation Guidelines. The updated valuation
determining the Fair Value of minority positions. guidelines address both the “unit of account” and
Some auditors have gone so far as to indicate that mathematical model questions. In addition, IPEV
they may require the use of option pricing models for released Investor Reporting Guidelines in October
determining the Fair Value of all minority positions. 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
Going Forward
Investor Reporting Guidelines provide balanced, and
With questions regarding whether or not IFRS should industry created, assistance in dealing with reporting
be interpreted as requiring all Fair Value estimates to and valuation questions.
be on a single share basis, and with U.S. auditors
appearing to feel some pressure to use mathematical NVCA and Thomson Reuters acknowledge and
models to document their audit conclusions, both appreciate the assistance of David Larsen of Duff
GPs and LPs in the venture capital and private equi- and Phelps in updating and refocusing the material
ty industry could be faced with financial reporting in this Appendix.
that is either very costly and/or is not representative
of how deals are done in the industry.
Thomson Reuters 103

104 Thomson Reuters

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 firm itself
becomes a general partner (GP) in the limited partnership. In most of the limited partnership agreements defin-
ing the GP-LP relationship, the GPs are required to provide financial reports quarterly (unaudited) and annu-
ally (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 LP’s need for Fair Value of their invest-
ments, as well as third-party or regulatory requirements, e.g., ERISA-regulation. In recent years, the GP-to-LP
financial statements have been subject to numerous rule “clarifications,” convergence with non-U.S. account-
ing, 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 first is portfo- ture fund, very little money is paid out in the first
lio performance presentation formats, calculations, four or five years. Also, while every portfolio compa-
and disclosure. Examples of such Guidelines are the ny receives funding with high expectations, it can
Private Equity Provisions of the Global Investment take several years to determine if a particular compa-
Performance Standards (GIPS), developed by the CFA ny is a likely winner. Therefore, understanding
Institute and the IPEV Investor Reporting Guidelines. progress in the portfolio requires some estimate of
While many of the specifications and terminology line the success of the investee companies by the venture
up with current practice in the United States, the capital or private equity firm. While many investors
NVCA has not endorsed or otherwise commented on and fund managers agree that financial measure-
these Guidelines. Neither NVCA nor Thomson ments mean little for the first three or so years of a
Reuters has determined how widespread the adoption fund, investors are required to report the Fair Value of
of those guidelines is or will likely be. These docu- their fund positions on a quarterly or annual basis.
ments and accompanying guidance can be currently This is where specific valuation rules and processes
found at http://www.cfainstitute.org/centre/codes/gips/ become important. The agreed valuation procedures
and www.privateequityvaluation.com. for individual portfolio companies become the basis
for progress assessment as the fund matures and ulti-
The second important category of guidelines is mately distributes cash to the investors.
focused on valuation.
Thus, while portfolio company valuations are more
of an art than a science, especially for pre-revenue or
Why Valuation Guidelines Matter
even pre-EBITDA companies, most limited partner
What ultimately matters to investors and private agreements (LPAs) establishing a venture capital
equity practitioners is the cash that has been distrib- fund require the venture firm to provide quarterly
uted to the investors during the life of the fund com- and annual financial statements using Generally
pared with the original money put in. However, the Accepted Accounting Principles (GAAP). GAAP
specified life of a typical venture fund is at least 10 requires Fair Value measurement for portfolio posi-
years and often longer in the life sciences arena. tions. Therefore, most GPs must issue financial state-
During that period, the venture capital fund reports ments using Fair Value.
progress to the limited partners. In many cases, this
means quarterly portfolio updates and a complete Most important, if industry-created valuation guide-
annual audited financial statement. For a typical ven- lines are not used, those outside the industry, such as
Thomson Reuters 105

auditors or regulators could impose their view on the self-appointed group of private equity practition-
industry. A non-industry view could adversely ers, fund managers, LPs and others, issued U.S.
impact the LPs desire and ability to invest if interim Private Equity Valuation Guidelines. The
values are not representative of the way the industry Guidelines were issued after extensive input and
sees value, and costs for determining valuation could review soliciting feedback and input from a num-
increase. ber of industry groups that included NVCA.
• 2005 – In part as a reaction to the PEIGG

The Evolution of Reporting and
Guidelines, three Europe-based venture capital
Valuation Guidelines associations (AFIC, BVCA, EVCA) created the
To understand the pressure on valuation and report- International Private Equity and Venture Capital
ing in today’s environment, a historical background (IPEV) Valuation Board.
review is instructive.
• April 2006 – IPEV released its Valuation
• 1940 – United States Investment Company legis- Guidelines.
lation (“the 40 Act”) required investment compa- • September 2006 – Financial Accounting
nies to report the Fair Value of investments. While Standards Board (FASB) issued its long-awaited
the application of accounting standards has and long anticipated Fair Value measurement stan-
evolved over the past 70+ years, the underlying dard as FAS 157. Only a few of its 145 pages relate
basis of reporting has always been Fair Value. directly to typical venture capital and private equi-
ty funds. Because the FASB maintains that this is a
• 1989-90 – A group of investors, private equity clarification and further definition of Fair Value
fund managers, and fund-of-fund managers that was already required for portfolio accounting,
formed a group to develop a set of portfolio com- some auditors began requiring selective compli-
pany valuation guidelines for financial reporting. ance in advance of the 2008 effective date.
Contrary to a very persistent rumor, the NVCA
did not endorse, adopt, bless, publish, or other- • March 2007 – PEIGG issued a revised portfolio
wise opine on the guidelines. Using the principle company valuation guidelines document to reflect
of conservatism, these non-endorsed guidelines the Fair Value Measurement standard (FAS 157).
used cost or the value of the last round of financ-
ing to approximate Fair Value. • September 2007 – NVCA board reaffirmed its
prior position on the PEIGG guidelines to refer to
• Decade of the 1990s – Two noteworthy develop- the most recent version.
ments occurred in the 1990s. Despite no endorse-
ment by the NVCA, these guidelines became • March 2008 – the IPEV Board reconstituted and
accepted practice by much of the United States re-launched itself and adds five practitioners from
industry, especially in the venture capital side of the United States. The initial focus of the group
private equity. These guidelines were referred to was on convergence of U.S. PEIGG and IPEV
by many as being issued by the NVCA but in fact valuation guidelines. Details at www.private-
they were not. The second development is that equityvaluation.com.
international venture associations created local-
ized guidelines based heavily on these guidelines. • July 2009 – Effective July 1, authoritative GAAP
These were created in Europe and other interna- became contained in a single codification and the
tional regions. In fact, by 2005, there had been prior nomenclature went away. Existing U.S.
multiple iterations of the European and British GAAP was recast into 90 topics, which include
guidelines, again generally focused on cost or the all related FASB pronouncements, AICPA guid-
value of the last round of financing. ance and EITFs under single “Topics.” Familiar
standards would no longer exist. For example,
• December 2003/September 2004 – The Private FAS 157 became Topic 820 Fair Value
Equity Industry Guidelines Group (PEIGG), a Measurements and Disclosure. Investment
106 Thomson Reuters

2013 NVCA Yearbook
Company accounting became ASC Topic 946. U.S. GAAP requires Fair Value reporting for virtually
all VC firms because they are “investment compa-
• May 2011 – FASB amended ASC Topic 820 and nies.” U.S. GAAP continues to define Fair Value as:
the IASB issues IFRS 13, resulting in nearly iden- “the price that would be received to sell an asset … in
tical Fair Value guidance. an orderly transaction between market participants at
the measurement date.”
• October 2012 – IPEV released Investor
Reporting Guidelines Fund managers need to establish Fair Values even
though they may not currently need to sell, or cannot
• December 2012 – IPEV updated its Valuation sell, their private investments in this market. GPs
Guidelines to harmonize with ASC Topic 820 and must use their judgment in estimating the current Fair
IFRS 13. Values of their investments, even though “exit mar-
kets” may have few buyers, IPO markets appear
closed, and there are few, if any, relevant comparable
NVCA Position on Portfolio Company
transactions. Such judgment should take into account
Valuation Guidelines all relevant information, including a financing
The NVCA Board of Directors has not specifically round’s specific terms and conditions. There are no
endorsed valuation guidelines, but has historically easy outs, rules of thumb or safe harbors for estab-
affirmed its support for pragmatic industry-support- lishing Fair Value. As always, best considerations for
ed valuation efforts. Fair Value determination include the following:
• The Fair Value of an investment portfolio is the

NVCA Member Alert –Fair Value
sum of the Fair Value determined for each portfo-
Considerations for Venture lio company using a “bottoms up” approach.
Capitalists–December 2008 Applying a “top-down” overall percentage adjust-
In 2008, as a response to the economic crisis at the ment to the aggregate portfolio’s value is not
time, the NVCA issued a membership alert. Much of compliant with U.S. GAAP.
that alert remains relevant today. • Valuations should reflect specific factors in a
buy/sell context. For example, a GP could ask:
The following alert was sent to the NVCA member- “Given my portfolio company’s current cash posi-
ship to highlight certain issues and considerations to tion, cash burn rate, performance compared to
be explored in the application of FAS 157, the Fair plan, probability of meeting forecasts, the pro-
Value measurement standard. The NVCA thanks jected environment for its product or technology,
David Larsen of Duff and Phelps and several mem- etc., as a board member, what is the lowest price
bers of the NVCA CFO Task Force for their role in that I would sell the company’s stock today in an
drafting this document: orderly sale with a willing buyer?” [Footnote: A
“We are operating in a severely distressed investment fund manager should not assume a “fire sale” of
environment that has deteriorated rapidly in the past the stock, but should assume “exposure to the
few months. What does this mean for venture capital market for a period prior to the measurement date
investors as they attempt to value privately-held to allow for marketing activities that are usual and
investments at December 31, 2008? The short answer customary …” from SFAS 157, Paragraph 7].
is: despite the current very challenging economic • The valuations set by the most recent financing
environment, fund managers must continue to exer- round – perhaps even one in the third quarter of
cise their sound judgment in estimating the Fair Value 2008 – may be stale and inappropriate for deter-
of each portfolio company after considering the rele- mining Fair Value, especially given current mar-
vant facts, including current market conditions. The ket conditions.
valuation process does not change, but much more • The Fair Value at December 31 in many cases will
judgment is required when we are in a period of eco- likely be different from the value at September
nomic discontinuity. Virtually all LP agreements 30, given the deterioration of the macroeconomic
require GPs to use U.S. GAAP for financial reporting. environment.
Thomson Reuters 107

• Each valuation should reflect a company’s is a single share of an investee company.

degree of progress from the prior reporting date to b. Single share valuations would likely result
the current one. in reporting understated Fair Values.
• To determine a portfolio company’s Fair Value, c. Reporting understated Fair Values would
GPs should apply their judgment in a consistent exacerbate the “J” curve, and could cause
manner and evaluate the same data they use for some LPs to reduce investments in the
monitoring a company’s performance and industry because of lower interim returns.
progress. There is no magic formula or weight- d. IFRS could deviate from U.S. GAAP even
ing of factors. though the Fair Value principles are identi-
cal.
In summary, determining Fair Value continues to
require the exercise of judgment based on objective 4. Auditors of U.S. GAAP have raised questions
evidence, such as calibrating the original investment concerning how to estimate the Fair Value of
decision with the current performance of the com- non-control positions.
pany and the current economic environment. The a. Is it appropriate to assume that the entire
fact that the macro market is distressed probably enterprise is being sold when estimating
adversely impacts the value of most companies. Fair Value?
This negative impact may be compounded by disap- b. For non-control positions, is it appropriate
pointing company performance or mitigated by tan- or required to use option pricing models and
gible and sustainable company progress. If you need theory to estimate Fair Value?
more details about Fair Value, you might consider
the IPEV Valuation Guidelines at The IASB is expected to address the Unit of
www.privateequityvaluation.com.” Account question during early 2013. The AICPA
has formed a task force to provide guidance on
investments of venture capital and private equity
2013 Headwinds
funds. Part of the reason the AICPA has formed a
As noted above, new pressure is emerging that could task force is because the IPEV guidelines have not
impact how venture capital and private equity man- been as formally accepted or acknowledged in the
agers estimate Fair Value. Key factors include: U.S. as they have been in Europe. Further, some par-
ties believe that the AICPA task force conclusions
1. LPs are awakening to the fact that they need to may be relatively auditor-friendly, rather than being
obtain more information from the GP about how GP/LP/Auditor/Service Provider balanced, as the
the GP estimates Fair Value so the LP can use IPEV guidelines are generally considered to be.
NAV to estimate the Fair Value of their LP inter-
est. All of this raises the question: could GPs reduce LP
a. LPs are revisiting their internal valuation questions and increase LP valuation comfort by stat-
policies. ing that they comply with the IPEV Valuation
b. LPs are asking more detailed valuation Guidelines? Further, if the IPEV Valuation
questions of the GP. Guidelines were more widely adopted by the VC
community, would the industry be able to push back
2. The IASB has created “investment company on an AICPA effort that could increase GP valuation
accounting” by requiring venture capital and pri- costs? Over the next year, greater clarity should
vate equity funds to report all investments at Fair emerge.
Value rather than consolidating control positions.
NVCA and Thomson Reuters acknowledge and
3. Auditors of IFRS have raised questions concern- appreciate the assistance of David Larsen of Duff
ing the level of aggregation (unit of account) that and Phelps in updating and refocusing the material
should be used to value venture capital and pri- in this Appendix.
vate equity investments.
a. Some auditors believe that unit of account
108 Thomson Reuters

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 diversification and search for high-
er returns. As such, Appendix J is produced for readers to analyze non-US private equity data. All data is
reported in US dollars.
Introduction **Special Note: The methodology used to generate

This appendix highlights various aspects of private the data within this appendix differs slightly from the
equity activity outside of the United States and pro- methodology used in previous years, causing data to
vides valuable information for comparison to the vary slightly from previous Yearbook issues.
United States private equity environment. However, However, trends reported in the past remain intact.
this appendix is not directly comparable to domestic Additionally, most data is now replicable on
data found in this Yearbook due to differences in defi- ThomsonONE.com.
nitions between the regions and variations in the cur-
rencies of each region. Additionally, this appendix pro-
Commitments
vides a brief overview of non-US private equity; data
herein is not as comprehensive as the United States Private equity commitment levels, outside of the
data presented elsewhere in this publication. Despite United States, totaled $110.3 billion in 2012.
this, the reader can use this appendix to analyze trends European-based funds raised the bulk, raising $59.6
in private equity outside of the United States. All data billion, equal to 54% of this amount. Meanwhile, Asian
is provided by Thomson Reuters. As mentioned previ- funds had $42.6 billion in fundraising commitments
ously, readers should note the differences in methodol- which is 39% of the total. Funds in the Other Regions
ogy and definitions of private equity between United raised the remaining $8.1 billion or 7% of the total. In
States and other regions before analyzing the data. For the stage level, Buyout commitments outside the
example, private equity outside of the United States United States accounted for $37.9 billion or 34% of the
provides equity capital for entities not publicly traded total. Surprisingly taking the second largest part of the
and consists of buyouts and venture capital. The cate- commitments was funds of funds which raised $24.1
gory of buyouts includes management buyouts (man- billion or 22% of the total. Venture Capital funds repre-
agement from inside the company investing with pri- sented 14% ($15.6 billion). Private Real Estate funds
vate equity investors), leveraged buyouts (the target raised $13.2 billion or 12% of the share. Other Private
taking on a high level of debt secured by assets), insti- Equity/Special Situation funds, Generalist, and
tutional buyouts (outside investors buying a business Mezzanine funds raised $9.7 billion, $7.7 billion, and
from existing shareholders), and management buy-ins $1.9 billion, respectively. It should be noted that these
(management from outside the company investing with totals reflect not only the amount raised by independent
private equity investors). On the other hand, venture funds, but also include capital gains and the amount
capital describes the process of financing companies at raised by captive funds.
the seed, start-up, or expansion stages. The United
States places more emphasis on the early stages of
Investments
development than do other regions, based on historical
analysis of investments by stage. Like in the United Overall, private equity investing outside of the
States, non-US venture capital is considered a subset of United States reached $73.1 billion. Buyout stage
private equity. For ease of analysis and to avoid differ- financing led investment activity, accounting for
ences in definitions between venture capital and buy- 69% of total dollars. The Venture Capital investments
outs inside and outside of the United States, it is per- followed with 17% of the total. By number of deals,
haps most comparable to analyze aggregate private Venture Capital investments led with 55% and the
equity in the two regions as opposed to any classifica- Buyouts investments followed with 36% of the total
tions contained within. deal activity outside of the United States. The United
Thomson Reuters 109

Kingdom received the biggest share of private equity Private equity commitments and investments saw a
outside the United States in 2012 with $13 billion decrease outside of the United States in 2012.
worth of investments or 18% of the total value. Commitments saw a slight decrease of 5% from $115
Canada followed with $10.5 billion. China comes in billion in 2011. Private equity investments dropped
at third with $8.4 billion or 12% of the total. 32% from $109 billion of the previous year.
Figure J1
Private Equity Commitments Outside of the United States in 2012
Amount Raised in
Fund World Location # Firms # Funds
Range (USD Mil)
Asia 196 213 42,564.6
Europe 124 138 59,629.0
Other Regions 89 73 8,143.8
TOTAL 409 424 110,337.4
Figure J2
Private Equity Commitments Outside of the United States By Fund Stage in 2012
Amount Raised in
Fund Stage # Firms # Funds
Range (USD Mil)
Buyouts 67 68 37,990.9
Venture Capital 216 221 15,612.9
Generalist 30 32 7,741.1
Mezzanine Stage 11 11 1,892.6
Fund of Funds 28 32 24,131.4
Other Private Equity/Special Situations 11 11 9,728.4
Real Estate 46 49 13,240.1
TOTAL 409 424 110,337.4
Figure J3
Private Equity Investing Outside of the United States By Location in 2012
Sum of Equity Invested

Company Nation # Deals # Companies (USD Mil)
United Kingdom 703 643 13,094.9
Canada 935 824 10,483.1
China 459 439 8,427.0
France 619 595 4,748.0
Germany 379 354 4,472.2
Hong Kong 21 18 4,018.1
Other Nations 2,326 2,203 27,832.5
TOTAL 5,442 5,076 73,075.8
Figure J4
Private Equity Investing Outside of the United States By Stage in 2012
Sum of Equity Invested

Company Stage # Deals # Companies (USD Mil)
Buyout/Acquisition 1,961 1,843 50,573.2
Venture Capital 3,010 2,846 12,534.5
Other 471 433 9,968.1
TOTAL 5,442 5,076 73,075.8
110 Thomson Reuters

NVCA 2013 Yearbook PDF

Загружено:

Сведения о документе

Оригинальное название

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

NVCA 2013 Yearbook PDF

Загружено:

Авторское право:

Доступные форматы

NATIONAL

NATIONAL VENTURE CAPITAL ASSOCIATION YEARBOOK 2013

Very truly yours

Diana Frazier Mark G. Heesen John S. Taylor

Ray Rothrock Josh Green

Michael Greeley Jonathan Leff

Jason Mendelson Scott Sandell

Diana Frazier Mike Elliott

Board Members At-Large

Jonathan Callaghan Maria Cirino

David Douglass Bruce Evans

Claudia Fan Munce Norm Fogelsong

Venky Ganesan Robert Goodman

Mark Gorenberg Jason Green

Ross Jaffe, MD Ray Leach

Sherrill Neff Robert Nelsen

David Lincoln James Marver

For the National Venture Capital Association

Prepared by Thomson Reuters

Copyright © 2013 Thomson Reuters

National Venture Capital Association Thomson Reuters

Global Head of Deals & Private Equity

Jennifer Connell Dowling Global Private Equity Operations Manager

Vice President of Communications

Emily Mendell Press Management

Vice President of Membership & Member Firm

Liaison Product Manager

Vice President of Federal Policy & Political Advocacy Content Specialist

Chief Marketing Officer Data Specialist

Vice President of Federal Life Science Policy Research Editor

Membership and Database Manager Senior Art Director

Accounting Manager ThomsonONE.com Sales:

What is Venture Capital? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Exits: IPOs and Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Appendix B: MoneyTree Report Criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77

Appendix C: MoneyTree Geographical Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

Appendix D: Industry Codes (VEICs). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83

Appendix E: Industry Sector VEIC Ranges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95

Appendix F: Stage Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97

Appendix G: Data Sources and Resources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

Appendix H: International Convergence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101

Appendix I: US Accounting Rulemaking and Valuation Guidelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105

Appendix J: Non-US Private Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

This page is intentionally left blank.

Venture capital has enabled the United States to sup-

Risk Capital for Business

Venture Capital Backed Companies

Many technologies currently under development by

Common Structure — Unique Results Known Failed

ate a venture capital fund are similar to those used by

Introduction the ThomsonONE.com (formerly VentureXpert)

U.S. Venture Funds ($ Billions)

All Investments Initial Investments

This is the sixth consecutive year in which more

Later Stage 32%

Semiconductors Industrial/Energy 10%

Number of Pct of Investment Pct of

Exits ing or seeking to go public were not able to do so.

This page is intentionally left blank.

METHODOLOGY added a column to the table to report the number of

Capital Under Management ($ Millions)

Figure 1.05 Figure 1.06

Methodology figure 1.04). The data in this chapter is by calendar