This document discusses emerging venture capital firms and funds. It shows that over 325 venture capital firms have been backed by First Republic Bank since 2014. The number of emerging venture capital firms has risen significantly from around 50 in 2009 to over 300 currently. There has also been growth in "nano-funds" of under $15 million. Median multiples and net IRR for first-time US funds of $0-100 million have varied in recent years but have remained positive. The forecast is for continued growth in new venture capital fund formation in 2017 focused on specific industries or regions. Contraction in the sector is expected in the future but not in 2017.

1. Member FDIC and Equal Housing Lender
RAISE SUMMIT
May 10, 2017

2. 4
Total Venture Capital
Firms banked
325+
Emerging
Venture Capital
Firms banked
175+
First Republic Bank
Venture Capital Efforts
Meetings
With Emerging Managers
Since 2014
750+

3. Observations/Findings
Twitter @SamirKaji

4. The First and the New Wave of
Emerging Managers
First Wave of Emerging Managers
Pre – 2011
New Wave of Venture Managers
2012 –

5. 6
US Funds $0-$100mn
Only First Time Funds
Source: Preqin May 2017

6. 6
The Rise of Emerging Venture
Capital
Firms - 375+ as of May 2017
0
50
100
150
200
250
300
2009 2010 2011 2012 2013 2014 2015
#ofFirms
No. of Emerging VC Funds
Source: First Republic Private Equity/Venture Capital

7. 6
US Funds $0-$100mn
Only First Time Funds Size
Source: Preqin May 2017

8. The growth of “Nano-funds”
Sub-$15MM funds

9. 6
US Funds $0-$100mn
Only First Time Funds Final
Close
Source: Preqin May 2017

10. 6
US Funds $0-$100mn
Multiple (X) Median
Source: Preqin May 2017
0.92 0.87
1.13 1.12
1.27
1.37
1.81
2.43
1.65
1.26
1.05
0
0.5
1
1.5
2
2.5
3
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006
Multiple (X) Median

11. 6
US Funds $0-$100mn
Net IRR Median
Source: Preqin May 2017
2014 2013 2012 2011 2010 2009 2008 2007 2006
IRR Median 11.8 16.1 15.6 18.2 0 17.1 12 4.7 11.5
0
2
4
6
8
10
12
14
16
18
20
IRR Median

12. 6
LP Survey on Emerging
Venture Capital Fund
Managers

13. Summary Thoughts and
Forecast
2
 First time funds formed by VC’s with prior experience are getting larger
(generally seed & Post-seed). First time investment managers generally
forced to raise Nano-Funds.
 Expect 2017 to outpace 2016 in terms of new fund formation
 Majority of new funds are vertically or geographically focused
 Contraction won’t happen in 2017, but is coming
 Continued scale of established seed funds