Each quarter First Republic partners with Preqin, a leading source of fund performance data, to offer you an in-depth review of U.S. venture capital industry with coverage of fundraising, deal totals and exits, plus a detailed examination of the microventure capital market. Here are some highlights from the findings:
- Venture capital investment in U.S.-based companies got off to a strong start in 2019 and the trend of fewer, but larger deals continued. To note, there were 2,179 deals completed for a total value of $55 billion in H1, which represented a 17% increase in deal value, but a 20% drop in number of deals from H1 2018.
- Early-stage investments (Series A and earlier stages) accounted for 51% of all deals but only 19% of total dollars raised by venture-backed companies.
- So far in 2019 there have been 304 venture-capital-backed exits of U.S.-based companies, valued at an aggregate $47 billion.
- Fundraising continues at a rapid pace, with nearly 200 new funds closing in H1 2019. Despite this activity, over 1,000 firms are in market fundraising seeking $95 billion in capital, an 8X increase from the same period in 2011.
- We continue to observe a trend where fund managers are coming back to market earlier than expected, driven by quicker-than-anticipated deployment paces of funds, and firms raising preemptively, potentially as a defense to potential future macroeconomic disruption.
Coming off a record year for microventure capital, the growth of the institutional seed space continues, with $3.4 billion collected across 128 funds completed in H1 2019, which exceeds the aggregate number of funds and dollars raised by this category of funds from 2009–2012.