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© 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587
US Venture Capital & Startup Traction Report
2015
© 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587
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Introduction
This report analyzes venture funding trends fo...
© 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587
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Table of Contents
Disclaimer
This information has been prep...
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10 Year Trends
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Yearly Cumulative Capital Deployed (All Stages): Last 10 Ye...
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AnnualDealVolumebyStage
0
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2006 ...
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S&P500Index(^SPX)
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1,500
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CapitalDepl...
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Year-over-Year
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Overall Deal Volume Up 20% Year-over-Year
Monthly Deal Volu...
© 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 10AnnualDealVolumebyStage
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Capital Deployment by Month (2015 vs. 2014)
MonthlyCapital...
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AnnualCapitalDeployedbyStage(billions
USD)
$0
$5
$10
$15
$...
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Pre Series A
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10 Year Trends in Pre Series A Capital Deployment
MATTERMA...
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MonthlyCapitalDeployed(millionsUSD)
$0
$40
$80
$120
$160
$...
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From the beginning of 2014 to present, the 12 month trend ...
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Top 10 Largest Series Pre Series A Rounds
Company
Funding
...
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Series A
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10 Year Trends in Series A Capital Deployment
MATTERMARK 2...
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MonthlyCapitalDeployed(billionsUSD)
$0.0
$0.4
$0.8
$1.2
$1...
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% of Series A Dollars, by Region
Other Regions
16%
Los Ang...
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The Largest Series A Rounds in 2015
Company Date
Amount
(U...
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Series B
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10 Year Trends in Series B Capital Deployment
MATTERMARK 2...
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Series B Deal Volume and Capital Deployment (2014 vs 2015)
25...
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% of Series A Dollars, by Region
Other Regions
20%
Los Ang...
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The Largest Series B Rounds in 2015
Company Date
Amount
(U...
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Series C
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Yearly Cumulative Series C Capital Deployed: Last 10 Years...
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Series C Deal Volume and Capital Deployment (2014 vs 2015)
30...
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Series C round sizes fluctuated throughout the year, reach...
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Top 10 Largest Series C Rounds
Company
Funding
Date
Fundin...
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Late Stage
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Yearly Cumulative Series D Capital Deployed: Last 10 Years...
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Yearly Cumulative Late Stage Capital Deployed: Last 10 Yea...
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Late Stage* Deal Volume and Capital Deployment (2014 vs 2015)...
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Median late stage round climbed dramatically in 2015, befo...
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Top 10 Largest Late Stage Rounds
Company
Funding
Date
Fund...
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Methodology
Time Period
For this report we examined Q1-4 2...
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Mattermark is where big data and machine learning bring scien...
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2015 Venture Capital & Startup Traction Report

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Dive into venture funding trends
Take an in-depth look at the funding events, growth signals, exits and other insights into the fastest growing private companies. It’s compiled by our independent, in-house editorial staff to help you make fast, informed and accurate decisions.

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2015 Venture Capital & Startup Traction Report

  1. 1. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 US Venture Capital & Startup Traction Report 2015
  2. 2. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 2 Introduction This report analyzes venture funding trends for US startups from 2006 to present. At Mattermark we pride ourselves on providing the startup ecosystem with information on how businesses grow, raise funding, and evolve. We believe utilization of these resources should be combined with your special knowledge of your industry, region and role. Startup investments and business decisions hold a level of risk on the part of investors, founders, employees, services providers, and anyone who stands to benefit from these transactions. We hope that this report both informs your future conversations and helps you head into 2016 fundraising and deal making with better data for your upcoming business decisions. Sincerely, Danielle Morrill, CEO & Cofounder of Mattermark Data Sources Mattermark uses a broad range of sources to present the most complete picture possible of the startup ecosystem. In addition to extensive primary source research sourced specifically for this report, Mattermark uses publicly-available data from AngelList (www.angel.co), Crunchbase (www.crunchbase.com), NASDAQ, (www.nasdaq.com), the United States Securities and Exchange Commission (www.sec.gov), and source relationships with thousands of investors, community leaders, and startup founders. Please send any questions, comments, or corrections for the editor to support@mattermark.com. MATTERMARK 2015 US STARTUP FUNDING REPORT
  3. 3. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 3 Table of Contents Disclaimer This information has been prepared by Mattermark, Inc. solely for informational purposes. It is not, and should not be regarded as, investment advice, as a recommendation regarding any particular security, or as a course of action. Opinions expressed herein are current opinions as of the date appearing in this material only and are subject to change without notice. No part of this document may be reproduced in any manner, in whole or in part, without the prior written permission of Mattermark, Inc. This information is provided with the understanding that, with respect to the material provided herein, you will make your own independent decision with respect to any course of action based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. Neither the information, nor any opinion contained herein, constitute a solicitation or offer by Mattermark, Inc. to buy or sell any securities, futures, options, or other financial instruments or provide any investment advice or service. Mattermark, Inc. does not purport to, and does not, in any fashion, provide broker/dealer, consulting, or any related services. Mattermark, Inc. shall not have any liability for any damages of any kind whatsoever relating to this material. By accepting this material, you acknowledge, understand, and accept the foregoing. 4 10 Year Market Overview 13 Pre Series A 18 Series A 23 Series B 29 Series C 34 Late Stage 40 Methodology Notes MATTERMARK 2015 US STARTUP FUNDING REPORT
  4. 4. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 10 Year Trends
  5. 5. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 5 Yearly Cumulative Capital Deployed (All Stages): Last 10 Years This chart shows just how dramatically venture capital deployment in 2015 outpaced not only 2014, but every year for the past 10. The bar chart below shows the trends for monthly capital deployment, to give you some sense of how overall venture capital deployment to startup has changed over time. June 2015 saw more capital deployed than any month in the past 10 years, with $6.7 Billion invested in startups. MonthlyCapitalDeployed-AllStages(billions USD) $0 $10 $20 $30 $40 $50 $60 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 MATTERMARK 2015 US STARTUP FUNDING REPORTMonthlyCapitalDeployed —AllStages(billions USD) $0 $1 $2 $3 $4 $5 $6 $7 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015
  6. 6. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 6 AnnualDealVolumebyStage 0 200 400 600 800 1,000 1,200 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Seed/Angel Series A Series B Series C Late Stage Historical Overall Deal Volume Trend: Last 10 Years Series A, B, and C round activity established new 10 year highs while the volume of Pre Series A deals rebounded significantly but is still off its 2013 peak. Late Stage financing rounds (Series D and beyond, excluding private equity rounds) peaked in 2014 and was slightly below flat for 2015. The second chart below shows the total monthly deal volume across every stage, and gives some sense of the seasonal effect of November and December holidays usually followed by a significant uptick in round announcements each January. MonthlyDealVolume- AllStages 0 100 200 300 400 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MATTERMARK 2015 US STARTUP FUNDING REPORT
  7. 7. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 7 S&P500Index(^SPX) 0 500 1,000 1,500 2,000 2,500 CapitalDeployed(billionsUSD) $0 $5 $10 $15 $20 $25 Q1'06 Q2'06 Q3'06 Q4'06 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09 Q1'10 Q2'10 Q3'10 Q4'10 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Quarterly Startup Investment Startup Investment 10YearTrend Quarter-End S&P 500 S&P 500 10YearTrend Historical Startup Capital Deployment vs. S&P 500 Index Looking at capital deployment vs. the S&P 500 Index with the broader historical view of the past 10 years, we see that there has been a close correlation between the 10 year trends up until 2015, when there was a large rise in capital deployment although the S&P 500 remained fairly stagnant. MATTERMARK 2015 US STARTUP FUNDING REPORT
  8. 8. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Year-over-Year
  9. 9. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 9 Overall Deal Volume Up 20% Year-over-Year Monthly Deal Volume (2015 vs. 2014) MonthlyDealVolume-AllStages 0 50 100 150 200 250 300 350 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2014 2015 2015 ended with deal volume up 20% above the volume for 2014, with deal volume up at every stage other than Series D (next slide). Deal volume increase was driven by Seed stage activity. This report explores the trends at various stages to understand the relationship between number of rounds, round sizes, and company stages. Cumulative Deal Volume (2015 vs. 2014) CumulativeDealVolume-AllStages 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec MATTERMARK 2015 US STARTUP FUNDING REPORT
  10. 10. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 10AnnualDealVolumebyStage 0 200 400 600 800 1,000 1,200 Pre A Series A Series B Series C Series D Late 2014 2015 121146 299 548 896 1,002 106 162 279 484 770 719 +39% +16% +13% +7% -10% +14% AnnualDealVolume-AllStages 0 500 1,000 1,500 2,000 2,500 3,000 3,500 Overall 3,012 2,520 +20% Deal Volume by Stage (2014 vs 2015) MATTERMARK 2015 US STARTUP FUNDING REPORT
  11. 11. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 11 Capital Deployment by Month (2015 vs. 2014) MonthlyCapitalDeployed-AllStages(billionsUSD) $0 $1 $2 $3 $4 $5 $6 $7 $8 Jan Feb Mar Apr May Jun July Aug Sept Oct Nov Dec 2014 2015 While deal volume in 2015 increased 20% year-over-year, cumulative capital deployment in 2015 outpaced last year’s levels by 46%. In the simplest terms, both the quantity and size of deals increased in 2015 with a trend toward higher capital concentration and greater valuations (and therefore, greater round sizes in many cases) across the board. To further understand this trend, we need to dig into the distribution of capital by stage. Cumulative Capital Deployed (2015 vs. 2014) CumulativeCapitalDeployed-AllStages(billionsUSD) $0 $10 $20 $30 $40 $50 $60 $70 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Overall Capital Deployment Up 46% Year-over-Year MATTERMARK 2015 US STARTUP FUNDING REPORT
  12. 12. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 12 AnnualCapitalDeployedbyStage(billions USD) $0 $5 $10 $15 $20 $25 Pre A Series A Series B Series C Series D Late 2014 2015 $17.4 $7.0 $10.1 $12.9 $9.3 $1.6 $5.9 $8.7 $7.8 $9.8 $6.5 $1.2 +32% +43% +32% +29% -19% +193% AnnualCapitalDeployed-AllStages (billionsUSD) $0 $10 $20 $30 $40 $50 $60 $70 Overall $58.3 $39.9 +46% 2015 Capital Deployment by Stage MATTERMARK 2015 US STARTUP FUNDING REPORT
  13. 13. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Pre Series A
  14. 14. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 14 10 Year Trends in Pre Series A Capital Deployment MATTERMARK 2015 US STARTUP FUNDING REPORT CumulativeCapitalDeployed(billionsUSD) $0.0 $0.4 $0.8 $1.2 $1.6 $2.0 Jan Feb M ar Apr M ay Jun Jul Aug Sep O ct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Pre Series A Annualized Trends 2006 to 2015 Yearly Capital Deployed: +710% Reported Deal Volume: +1516% Average Round Size: +131% 12MonthAvg.RoundSize(millionsUSD) $0.0 $0.4 $0.8 $1.2 $1.6 $2.0 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MonthlyDealVolume 0 30 60 90 120 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 This year Angel and Seed round volume continued to set records with more capital deployed at this stage in 2015 than any time in the past 10 years. A total of $1.6 billion was invested across 1,002 announced rounds in 2015. Deal volume increased 39% year-over-year while capital deployment increased 32%. Round size peaked in early 2015 although the year ended with the 6 month average round size unchanged at $1.7 million in both December 2014 and December 2015.
  15. 15. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 15 MonthlyCapitalDeployed(millionsUSD) $0 $40 $80 $120 $160 $200 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec CumulativeCapitalDeployed(millionsUSD) $0 $400 $800 $1,200 $1,600 $2,000 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Pre Series A Deal Volume and Capital Deployment (2014 vs 2015) MonthlyDealVolume 0 20 40 60 80 100 120 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2014 2015 CumulativeDealVolume 0 200 400 600 800 1,000 1,200 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec +39% Year-Over-Year DEAL VOLUME Pre Series A deal volumes declined throughout Q4, primarily driving the trend whereby deal volume flattened across all stages. Early 2016 data suggests that Pre Series A deal volume will remain low, with 61 Pre Series A rounds completed in January 2016. +32% Year-Over-Year CAPITAL DEPLOYMENT Capital deployment fell dramatically in November and December, although overall capital deployment is up year-over- year. November saw the lowest level of funding at this stage since March 2014. The trend of consolidation to larger rounds at this stage has stabilized, and overall activity is on the decline beyond seasonal norms in recent months. * include “Angel”, “Seed” and “stageless” rounds of $1 million or less MATTERMARK 2015 US STARTUP FUNDING REPORT
  16. 16. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 16 From the beginning of 2014 to present, the 12 month trend average Pre Series A round size has increased from $1.2 million to $1.7 million, despite a significant decline late in 2015. Pre Series A rounds sizes appeared to spike and drop in late 2014. In August 2015, as the stock market sharply declined, average seed round size dropped to the same level as early 2014, before rebounding through the remainder of the year until December, when they fell to 2013 levels. Pre Series A Round Sizes (2015 vs. 2014) AverageRoundSize(millionsUSD) $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 3.2007 6.2007 9.2007 12.2007 3.2008 6.2008 9.2008 12.2008 3.2009 6.2009 9.2009 12.2009 3.2010 6.2010 9.2010 12.2010 3.2011 6.2011 9.2011 12.2011 3.2012 6.2012 9.2012 12.2012 3.2013 6.2013 9.2013 12.2013 3.2014 6.2014 9.2014 12.2014 3.2015 6.2015 9.2015 12.2015 Average Round Size 12 Month Trend Pre Series A Deal Size Trends MATTERMARK 2015 US STARTUP FUNDING REPORT
  17. 17. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 17 Top 10 Largest Series Pre Series A Rounds Company Funding Date Funding Amount (USD) Investors Region Globality 9/22/2015 $10 M Al Gore, Sheryl Sandberg, Ken Goldman, Ron Johnson Bay Area Sano 6/19/2015 $10.25 M Intel Capital, Felicis Ventures, Floodgate Fund, True Ventures, Elevation Partners, Rock Health, First Round Capital Bay Area Stellar Labs 11/16/2015 $8.6M Western Technology Investment, Camp One Ventures, Sherpa Ventures, Structure Capital, Impossible Ventures, Aslanoba Capital, Dolby Family Ventures, Rob Solomon, Geoff Baldwin, Scott and Cyan Bannister, Chris Skarakis, Robert Schumacher. Bay Area Jukely 4/28/2015 $8 M Northzone, Larry Marcus, Jared Hecht, Steve Martocci, Maiden Lane Ventures, 14W, Hany Nada New York Ground Signal 6/10/2015 $8 M Gary Vaynerchuk, Robin Brown Boston Cube26 10/18/2015 $7.7 M Tiger Global Management, Flipkart Bay Area Flexport 5/11/2015 $6.9 M Acequia Capital, A-GRade Investments, Bloomberg BETA, Box Group, Cherubic Ventures, First Round Capital, Fuel Capital, Funders Club, Google Ventures, Hydrazine Capital, Inside Capital, Kindling Capital, Lunch Van Fund, Susa Ventures, SV Angel, TYLT Lab, Winklevoss Capital Fund, Y Combinator Bay Area Stringify 4/21/2015 $6.3 M ARTIS Ventures, OurCrowd Bay Area Pixvana 12/14/2015 $6 M Madrona Capital, Vulcan Capital Seattle PeerIQ 4/9/2015 $6 M John Mack, Vikram Pandit, Uprising, Arthur Levitt, Dan Doctoroff, Eric Schwartz New York MATTERMARK 2015 US STARTUP FUNDING REPORT
  18. 18. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Series A
  19. 19. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 19 10 Year Trends in Series A Capital Deployment MATTERMARK 2015 US STARTUP FUNDING REPORT CumulativeCapitalDeployed(billionsUSD) $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 Jan Feb M ar Apr M ay Jun Jul Aug Sep O ct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Series A Annualized Trends 2006 to 2015 Capital Deployed: +272% Reported Deal Volume: +137% Average Round Size: +62% 12MonthAvg.RoundSize(millionsUSD) $5 $6 $7 $9 $10 $11 $12 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MonthlyDealVolume 0 30 60 90 120 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 Upward movement of overall Series A deal volume, capital, and round sizes continued in 2015 with $9.3 billion invested in 896 rounds, allaying fears of a Series A crunch. Series A deal activity increased16% year-over-year, while capital deployment increased 43%. 2015 saw a greater round sizes, moving the 6 month average round size up 20%, from $8.2 million in December 2014 to $10.5 million in December 2015. Notably, these increases were driven primarily by the healthcare industry.
  20. 20. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 20 MonthlyCapitalDeployed(billionsUSD) $0.0 $0.4 $0.8 $1.2 $1.6 $2.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Cumulative Capital Deployed CumulativeCapitalDeployed(billionsUSD) $0 $2 $4 $6 $8 $10 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec MonthlyDealVolume 0 20 40 60 80 100 120 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015 CumulativeDealVolume 0 200 400 600 800 1,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec +16% Year-Over-Year DEAL VOLUME Cumulative Series A deal volume outpaced 2014 through October before lagging behind last year’s activity levels, likely due to a general pullback following the August stock market correction. +43% Year-Over-Year CAPITAL DEPLOYMENT Cumulative Series A capital deployment outpaced 2014 throughout the year, ending the year up 43%. Despite lower deal volume in November and December, larger deal sizes kept the dollar amounts above those deployed in the same months last year. MATTERMARK 2015 US STARTUP FUNDING REPORT Series A Deal Volume and Capital Deployment (2014 vs 2015)
  21. 21. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 21 % of Series A Dollars, by Region Other Regions 16% Los Angeles 10% Boston 15% New York 16% Bay Area 43% Series A Capital Deployment MATTERMARK 2015 US STARTUP FUNDING REPORT Region 2015 Funding Rounds Average Round Size Bay Area $3.4 B 299 $11.4 M New York $1.3 B 125 $10.7 M Boston $1.2 B 92 $13.3 M Los Angeles $762 M 72 $10.6 M San Diego $230 M 14 $16.5 M Austin $248 M 28 $8.8 M D.C. Area $288 M 29 $9.9 M Chicago $194 M 20 $10 M Salt Lake City $133M 16 $8.3 M Dallas $63 M 3 $21 M Philly $107 M 14 $7.6 M
  22. 22. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 22 The Largest Series A Rounds in 2015 Company Date Amount (USD) Investors Region Karhoo 10/29/2015 $250 M Nick Gatfield, David Kowitz New York Denali Therapeutics 5/14/2015 $217 M Flagship Ventures, ARCH Venture Partners, F-Prime Capital Partners, Alaska Permanent Fund Bay Area Gritstone Oncology 10/20/2015 $102 M Frazier Healthcare Ventures, Clarus Ventures, Versant Ventures, The Column Group, Redmile Group, Casdin Capital, Transformational Healthcare Opportunity Bay Area Clover Health 9/17/2015 $100 M Athyrium Capital Management, First Round Capital Bay Area Turing Pharmaceuticals 8/10/2015 $90 M Martin Shkreli New York Calhoun Vision 6/4/2015 $69 M Longitude Capital, RA Capital Management, H.I.G. BioVentures Los Angeles NerdWallet 5/12/2015 $64 M RRE Ventures, iGlobe Partners, Institutional Venture Partners (IVP) Bay Area Atreca 10/20/2015 $56 M Bill & Melinda Gates Foundation, Mission Bay Capital, GlaxoSmithKline Bay Area Neon Therapeutics 10/1/2015 $55 M Clal Biotechnology Industries, Access Industries, Rock Ventures Boston Decibel Therapeutics 10/14/2015 $52 M SR One, Third Rock Ventures Boston MATTERMARK 2015 US STARTUP FUNDING REPORT
  23. 23. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Series B
  24. 24. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 24 10 Year Trends in Series B Capital Deployment MATTERMARK 2015 US STARTUP FUNDING REPORT CumulativeCapitalDeployed(billionsUSD) $0 $2 $4 $6 $8 $10 $12 $14 Jan Feb M ar Apr M ay Jun Jul Aug Sep O ct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Comparing 2006 vs. 2015 Yearly Capital Deployed: +283% Yearly Deal Volume: +99% Average Round Size: +109% 12MonthAvg.RoundSize(millionsUSD) $5 $10 $15 $20 $25 $30 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MonthlyDealVolume 0 10 20 30 40 50 60 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 Series B capital deployment in 2015 significantly outpaced 2014 as well as every year of the past 10. Average deal sizes (and therefore likely valuations) found an all- time high in November. Deal volume increased by 13% year-over-year while capital deployment increased 32%. 2015 saw a greater concentration of dollars per round, moving the 6 month average Series B round size up 9%, from $23 million in December 2014 to $24.9 million in December 2015.
  25. 25. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Series B Deal Volume and Capital Deployment (2014 vs 2015) 25 MonthlyCapitalDeployed(billionsUSD) $0.0 $0.4 $0.8 $1.2 $1.6 $2.0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec CumulativeCapitalDeployed(billionsUSD) $0 $3 $6 $9 $12 $15 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec MonthlyDealVolume 0 10 20 30 40 50 60 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2014 2015 CumulativeDealVolume 0 100 200 300 400 500 600 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec +13% Year-Over-Year DEAL VOLUME Cumulative Series B deal volume outpaced 2014 throughout the year, and unlike Series A this stage this trend continued in November and December. +32% Year-Over-Year CAPITAL DEPLOYMENT Cumulative Series B capital deployment outpaced 2014 throughout the year, ending the year up 32%. December marked the lowest capital deployment of any month in the year, ending just above last year’s level in the same month. MATTERMARK 2015 US STARTUP FUNDING REPORT
  26. 26. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 26 % of Series A Dollars, by Region Other Regions 20% Los Angeles 5% Boston 11% New York 14% Bay Area 50% Series B Capital Deployment MATTERMARK 2015 US STARTUP FUNDING REPORT Region 2015 Funding Rounds Average Round Size Bay Area $6.4 B 244 $26.1 M New York $1.8 B 78 $22.5 M Boston $1.4 B 53 $25.6 M Los Angeles $709 M 35 $20.3 M North Carolina $333 M 11 $30.3 M Texas $315 M 16 $19.7 M Seattle $312 M 18 $17.3 M Chicago $278 M 14 $19.9 M D.C. Area $237 M 12 $19.8 M Philly $165 M 10 $16.5 M San Diego $146 M 9 $16.3 M Minneapolis $134 M 4 $34.9 M Colorado $124 M 10 $12.4 M Utah $67 M 5 $13.4 M
  27. 27. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 27 The Largest Series B Rounds in 2015 Company Date Amount (USD) Investors Region Tenable Network Security 11/10/2015 $250 M Insight Venture Partners, Accel Partners Baltimore GitHub 7/29/2015 $250 M Sequoia Capital, Andreessen Horowitz, Thrive Capital, Institutional Venture Partners Bay Area OnceSource Virtual 6/22/2015 $150 M Technology Crossover Ventures, Halyard Capital Dallas Humacyte 10/20/2015 $150 M Access Industries, Reignwood Group, Pacific Eagle Asset Management, Brady Dougan Raleigh Oscar 4/20/2015 $145 M Goldman Sachs, Founders Fund, Horizon Ventures, Wellington Management New York Jet 2/11/2015 $140 M Silicon Valley Bank, Goldman Sachs, New Enterprise Associates, Accel Partners, Google Ventures, General Catalyst Partners, Bain Capital Ventures, MentorTech Ventures, Thrive Capital, Coatue Management, Temasek Holdings, Norwest Venture Partners New York Editas Medicine 8/10/2015 $120 M Deerfield Management, Viking Global Investors, Fidelity Management & Research Company, T. Rowe Price Associates, Inc., Google Ventures, Jennison Associates, Flagship Ventures, Polaris Partners and Third Rock Ventures, Partners Innovation Fundon behalf of certain clients, Khosla Ventures, EcoR1 Capital, Casdin Capital, Omega Funds, Boston 21 Inc. 3/10/2015 $116 M Khosla Ventures, RRE Ventures, Qualcomm Ventures, Andreessen Horowitz, Data Collective, Yuan Capital Bay Area Zscaler 8/3/2015 $110 M Lightspeed Venture Partners, EMC, TPG Capital, Google Capital Bay Area FinancialForce.com 3/26/2015 $110 M Technology Crossover Ventures, Salesforce Ventures Bay Area MATTERMARK 2015 US STARTUP FUNDING REPORT
  28. 28. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Series C
  29. 29. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 29 Yearly Cumulative Series C Capital Deployed: Last 10 Years The 12 month running average Series B deal size has increased 1.9x (+92%) from the end of 2006 to the end of 2015. CumulativeCapitalDeployed(billionsUSD) $0 $1 $2 $3 $4 $6 $7 $8 $9 $10 $11 Jan Feb M ar Apr M ay Jun Jul Aug Sep O ct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 12MonthAvg.RoundSize(millionsUSD) $10 $15 $20 $25 $30 $35 $40 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MonthlyDealVolume 0 10 20 30 40 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MATTERMARK 2015 US STARTUP FUNDING REPORT
  30. 30. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Series C Deal Volume and Capital Deployment (2014 vs 2015) 30 MonthlyCapitalDeployed(billionsUSD) $0.0 $0.5 $1.0 $1.5 $2.0 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec CumulativeCapitalDeployed(billionsUSD) $0 $3 $6 $9 $12 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec MonthlyDealVolume 0 5 10 15 20 25 30 35 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2014 2015 CumulativeDealVolume 0 50 100 150 200 250 300 350 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec +7% Year-Over-Year DEAL VOLUME Cumulative Series C deal volume outpaced 2014 beginning in March and is now up 7% year-over year. Q4 saw deal volume at this stage steadily decline, continuing a trend from Q3 that began with a peak of Series C activity in July. +29% Year-Over-Year CAPITAL DEPLOYMENT Cumulative Series C capital deployment began outpacing 2014 in May, and ended the year up 29% year-over year. Series C capital deployment was remarkably consistent in the second half of the year, significantly outpacing a much slower Q3 and Q4 in 2015 before dropping dramatically in December. MATTERMARK 2015 US STARTUP FUNDING REPORT
  31. 31. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 31 Series C round sizes fluctuated throughout the year, reaching an all-time high in November 2015. Despite remaining above 2014 levels for most of the year, average Series C in December dropped to the lowest level since October 2014. Over 50 companies across numerous verticals (e.g. healthcare, enterprise software, consumer products) raised Series C rounds above $50 million. Series C Deal Sizes (2015 vs. 2014) RoundSize(millionsUSD) $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2014 Average 2015 Average 2014 Median 2015 MedianSeries C Deal Size Trends MATTERMARK 2015 US STARTUP FUNDING REPORT
  32. 32. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 32 Top 10 Largest Series C Rounds Company Funding Date Funding Amount (USD) Investors Region Zenefits 6/5/2015 $500 M Khosla Ventures, Insight Venture Partners, Founders Fund, Ashton Kutcher, Andreessen Horowitz, Fidelity Investments, Jared Leto, TPG Capital, Institutional Venture Partners (IVP), Sound Ventures Bay Area Jet 11/24/2015 $350 M Google Ventures, Bain Capital Ventures, Fidelity Investments, Alibaba New York Affirm 5/6/2015 $275 M Khosla Ventures, Lightspeed Venture Partners, Spark Capital, Andreessen Horowitz, Jefferies Group Bay Area Instacart 1/13/2015 $220 M Khosla Ventures, Sequoia Capital, Comcast Ventures, Andreessen Horowitz, Valiant Capital Partners, Dragoneer Investment Group, Thrive Capital, Kleiner Perkins Caufield & Byers Bay Area NantHealth 6/30/2015 $200 M Allscripts Los Angeles Purch 6/3/2015 $135 M Canso Investment Counsel New York Apttus 9/1/2015 $108 M Iconiq Capital, Kuwait Investment Authority, Salesforce Ventures, K1 Investment Management Bay Area Mirantis 8/23/2015 $100 M Intel Capital, Goldman Sachs, Insight Venture Partners, Sapphire Ventures, WestSummit Capital, August Capital, Ericsson Bay Area Carbon3D 8/20/2015 $100 M Sequoia Capital, Google Ventures, Yuri Milner, Northgate Capital, Silver Lake Partners, Reinet Investments S.C.A. Bay Area Crowdstrike 7/13/2015 $100 M Accel Partners, Warburg Pincus, Rackspace, Google Capital Los Angeles MATTERMARK 2015 US STARTUP FUNDING REPORT
  33. 33. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Late Stage
  34. 34. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 34 Yearly Cumulative Series D Capital Deployed: Last 10 Years Series D rounds are not included in the subsequent “Late Stage” graphs, but you can see these rounds have followed a similar trend, with capital deployment peaking in 2014. CumulativeCapitalDeployed(billionsUSD) $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 Jan Feb M ar Apr M ay Jun Jul Aug Sep O ct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 12MonthAvg.RoundSize(millionsUSD) $10 $20 $30 $40 $50 $60 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MonthlyDealVolume 0 4 8 12 16 20 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MATTERMARK 2015 US STARTUP FUNDING REPORT
  35. 35. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 35 Yearly Cumulative Late Stage Capital Deployed: Last 10 Years 12MonthAvg.RoundSize(millionsUSD) $10 $30 $50 $70 $90 $110 $130 $150 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 CumulativeCapitalDeployed(billionsUSD) $0 $4 $8 $12 $16 $20 Jan Feb M ar Apr M ay Jun Jul Aug Sep O ct Nov Dec 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 The 12 month running average for Late Stage deal sizes (Series E, F, G, and H) has increased 10.6x (+959%) from the end of 2006 to the end of 2015. MonthlyDealVolume 0 5 10 15 1.2006 1.2007 1.2008 1.2009 1.2010 1.2011 1.2012 1.2013 1.2014 1.2015 MATTERMARK 2015 US STARTUP FUNDING REPORT
  36. 36. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Late Stage* Deal Volume and Capital Deployment (2014 vs 2015) 36 MonthlyCapitalDeployed(billionsUSD) $0 $1 $2 $3 $4 $5 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec CumulativeCapitalDeployed(billionsUSD) $0 $6 $12 $18 $24 $30 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec MonthlyDealVolume 0 10 20 30 40 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2014 2015 CumulativeDealVolume 0 75 150 225 300 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec -0.4% Year-Over-Year DEAL VOLUME Cumulative late stage deal volume in 2015 was just 1 deal behind the pace for 2014, and followed a similar pattern, with lower activity in the 4th quarter. January 2016 saw a substantial uptick in late stage deals, with 30 recorded venture capital transactions making it the most active January of the past 10 years. +67% Year-Over-Year CAPITAL DEPLOYMENT Late stage capital deployment exploded past last year’s pace, and has continued on a tear that has seen the rise of “unicorns” in the media and general startup vernacular. Deployment tapered down dramatically in the 4th quarter of 2015, however January 2016 is off to an aggressive start with $4.1 Billion already deployed in the first month of the year. * includes Series D, E, F, G, H etc. and excludes deals categorized as Private Equity MATTERMARK 2015 US STARTUP FUNDING REPORT
  37. 37. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 37 Median late stage round climbed dramatically in 2015, before returning to early 2014 levels in December. The continued rise of the “unicorn startups” is part of the trend we see here, and these larger rounds indicate large valuations, pushing more private companies over the billion dollar valuation mark than we’ve ever see in the pre-IPO market. Q4 2015 saw convergence of average and median late stage round sizes in the low $30 millions, just under the level they started off with at the beginning of 2014. This would be an appropriate time to use the phrase “reversion to the mean” for this stage. Late Stage Deal Sizes (2015 vs. 2014) RoundSize(millionsUSD) $25 $50 $75 $100 $125 $150 $175 $200 Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2014 Average 2015 Average 2014 Median 2015 MedianLate Stage Deal Size Trends MATTERMARK 2015 US STARTUP FUNDING REPORT
  38. 38. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 38 Top 10 Largest Late Stage Rounds Company Funding Date Funding Amount (USD) Investors Region Uber 2/18/2015 $2.8 B New Enterprise Associates, Lone Pine Capital, Valiant Capital Partners, Qatar Investment Authority, Baidu Bay Area Airbnb 6/29/2015 $1.5 B Sequoia Capital, General Atlantic, Tiger Global Management, Hillhouse Capital Group, China Broadband Bay Area Uber 9/7/2015 $1.2 B Baidu Bay Area SoFi 8/19/2015 $1.0 B SoftBank Group Bay Area Uber 8/1/2015 $1.0 B Bennett Coleman and Co, Times Internet Ltd., Microsfot Ventures Bay Area SpaceX 1/20/2015 $1.0 B Fidelity Investments, Google Los Angeles Snapchat 5/29/2015 $537 M Fidelity Investments, York Capital Management, Glade Brook Capital Partners Los Angeles Lyft 3/11/2015 $530 M Fortress Investment Group, Rakuten, Carl Icahn, Didi Kuaidi Bay Area Pinterest 3/16/2015 $367 M SV Angel, Bessemer Venture Partners, Andreessen Horowitz, Fidelity Investments, Rakuten Bay Area DocuSign 10/8/2015 $300 M Intel Capital, Brookside Capital, Generation Investment Management, Dell Ventures, Iconiq Capital, Sands Capital Ventures, Wasatch Advisors, Deutsche Telekom, ClearBridge Investments, Wellington Management Seattle MATTERMARK 2015 US STARTUP FUNDING REPORT
  39. 39. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 39 Methodology Time Period For this report we examined Q1-4 2015 Venture activity and funding trends in the year prior, as well at 5 and 10 year historical benchmarks. Funding Rounds For population statistics referencing “Venture-Backed” startups, inclusion for analysis was restricted to deals that disclosed the amount of funding raised. Criteria All analyses include USA companies. Metropolitan regions reflect Combined Statistical Areas as defined by the United States Office of Management and Budget. Data Sources Mattermark uses a broad range of sources to present the most complete picture possible of the startup ecosystem. In addition to extensive primary source research sourced specifically for this report, Mattermark uses publicly-available data from AngelList (www.angel.co), Crunchbase (www.crunchbase.com), NASDAQ, (www.nasdaq.com), the United States Securities and Exchange Commission (www.sec.gov), and source relationships with thousands of investors, community leaders, and startup founders. Please send any questions, comments, or corrections for the editor to support@mattermark.com. MATTERMARK 2015 US STARTUP FUNDING REPORT
  40. 40. © 2016 ALL RIGHTS RESERVED ● MATTERMARK.COM ● (415) 366-6587 Mattermark is where big data and machine learning bring science to the art of deal making. Our groundbreaking analytics are helping thousands of professionals research, prospect, track, qualify, and benchmark signals of growth and news coverage for 1M+ private and public technology companies from around the world. 
 
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