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State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
State Of Venture Capital 2013
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State Of Venture Capital 2013

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SCV's annual State Of Venture Capital for this year.

SCV's annual State Of Venture Capital for this year.

Published in: Economy & Finance, Business
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  • 1. State Of US Venture CapitalQ1 2013www.startupcv.comtwitter: @dicktim
  • 2. Startup Capital Ventures•  Early stage enterprise-focused venturecapital in Silicon Valley & Hawaii•  Top decile fund performance•  We like technology, IP and the cloud•  We love insanely curious domain-expertentrepreneurs• Silicon Valley • Honolulu      Page  2  
  • 3. What’s Going On In The US VC Cycle?      Page  3  VCsInvest InStartupsStartupsExit ViaM&A orIPOVCsreturncapital toLPsLPsInvest InVCs• Silicon Valley • Honolulu
  • 4. Agenda•  LP Investments In VC•  VC Investing Activity•  Exit Activity•  Conclusions• Silicon Valley • Honolulu      Page  4  
  • 5. US Venture Capital Raised Is Stable AtAround $19B    Page  5  .com boom& bustSource: NVCA• Silicon Valley • Honolulu
  • 6. The Number Of US Venture Funds Raised IsAlso StablePage  6  Source: NVCA• Silicon Valley • Honolulu
  • 7. Follow-On Vs. New Funds Raised Is About70 / 30 SplitSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 7"
  • 8. Agenda•  LP Investments In VC•  VC Investing Activity•  Exit Activity•  Conclusions• Silicon Valley • Honolulu      Page  8  
  • 9. $26B Of Venture Capital Invested Is WellAbove $19B Of Inflow To FundsSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 9"
  • 10. Software & Biotech. & Cleantch Are TheLargest Investment SectorsSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 10"
  • 11. IT Venture Investment Is Thriving•  “Life sciences investment was suppressed duein part to the impact of the regulatoryenvironments•  Clean tech investors began moving towardsdeals less dependent on government support•  Investment in information technology flowed, asfar fewer obstacles impeded success in thosesectors”- Mark Heesen, President NVCA• Silicon Valley • Honolulu      Page  11  
  • 12. Early Stage Investing Has Returned WhileSeed Stage DeclinesSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 12"
  • 13. Silicon Valley Continues To Dominate USVenture Capital InvestmentSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 13"
  • 14. Early Stage Deal Size Is Decreasing AsStartups Become More Capital EfficientSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 14"
  • 15. Crowdsourced Equity Is Mostly SmallTranches From Angels• Silicon Valley • HonoluluSource: Massolution, Crowdsource.org"Page 15"
  • 16. "Page 16"Up-Rounds Continue To Constitute MostFinancingsSource: Fenwick & West• Silicon Valley • Honolulu
  • 17. Up-Round Valuation Increase ContinuesAbout +85%• Silicon Valley • HonoluluSource: Fenwickthe fenwick & west venture capital barometer™ (magnitude of price change)—Set forth belowpercentage change between the price per share at which companies raised funds in a quarter, compaprice per share at which such companies raised funds in their prior round of financing. In calculatingrounds (up, down and flat) are included, and results are not weighted for the amount raised in a finaThe Barometer results by series are as follows:100% *90%80%70%60%50%40%30%20%10%0%Q1’11 Q2’11 Q3’11 Q4’11 Q1’12 Q2’12 Q3’12 Q4’1230%52%52%71% 78%69%85% 85%99%Barometer Combined TotalRedemption168%142%**116%90%64%38%12%-14%-40%Q1’11 Q2’11 Q3’11 Q4’11 Q1’12 Q2’12 Q3’12 Q4’12SoftwareHardwareLife ScienceInternet/DigitaCleantechBarometer Percentage Change By Series*One software company had a 1460% up round and one internet/digital media company had a 1190% up rIf these were excluded the Barometer result for 2Q12 would have been 70%. "Page 17"
  • 18. Agenda•  LP Investments In VC•  VC Investing Activity•  Exit Activity•  Conclusions• Silicon Valley • Honolulu      Page  18  
  • 19. "Page 19"IPO and Especially M&A Activity Is StrongSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu
  • 20. VC-backed IPO and M&A ValuationsRemain RobustSource: Thomson Reuters / NVCA• Silicon Valley • Honolulu"Page 20"2012 is ex Facebook(avg. would be $5B)
  • 21. • VC Returns Continue to Outperform• Public MarketsVC Returns Currently Untypically LaggingBooming Stock Markets.com boom.com bustSource: NVCA, Cambridge Associates• Silicon Valley • Honolulu      Page  21  
  • 22. Medium Size Funds Produce Best Returns• Confidential To RecipientPage 22"• Source: Cambridge Associates, NVCA05101520253035Funds < $50M $50-$150M >$150MFundIRR(%)Fund Size ($)US Venture Capital Fund Returns (1998-2008)
  • 23. Agenda•  LP Investments In VC•  VC Investing Activity•  Exit Activity•  Conclusions• Silicon Valley • Honolulu      Page  23  
  • 24. The Venture Market Is Moving Nicely•  Plenty of deals are getting funded•  Deal quality is solid with good revenue andprofitability•  Exit activity is good in both number ofdeals and valuation•  LPs continue to invest in VC albeit not atthe level VCs are investing in startups• Silicon Valley • Honolulu      Page  24  
  • 25. VCs Invested$26B In Portfolio$210B InVenture Exits(IPO + M&Aproceeds)LPs Invested$19B In VCs2012 Venture Funding Cycle Created GoodReturns For LPs But Still ImbalancedPage  25  Sources: NVCA, Thomson Reuters, Cambridge• Silicon Valley • Honolulu
  • 26. Market Equilibrium Will Return(One Way Or Another)•  Good VC exit markets create strong returns for LPs(better than public markets)•  Healthy funding levels at all stages•  VCs solidly funding new deals•  LP funding growing but still lagging VC returns      Page  26  Venture capital shrinksto match LPinvestment in VCVC funding grows asLPs return to VCsector• Silicon Valley • Honolulu
  • 27. • Copyright © 2010 Startup Capital Ventures Page 27Author: Tim Dick•  General Partner, Startup Capital Ventures–  Boards: SilverTail (acquired EMC), TuneIn, Adama Materials,TagArray•  Entrepreneur, angel and advisor has raised over $300M in early stagecapital with over $1.2B of exits–  Match.Com (Angel, acquired by IAC)–  WorldPages.com (Founder, CEO, IPO NYSE:WPZ acquired by BT)–  TRUSTe.org / Privacy Assured (Internet privacy standard)–  Accept.com (mentor capitalist, acquired by Amazon)–  Grassroots Enterprise (Founding President, acquired by Edelman)–  Hawaii Superferry (founding CEO)–  Dali Wireless (turnaround CEO)•  Boston Consulting Group•  Beckman Instruments: invented first “instrument on a chip” (1985) &first ICU usable speech synthesizer for intubated patients (1981)•  MBA, Stanford University•  BSEE, University of California
  • 28. www.startupcv.comtdick@startupcv.com

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