Pitchbook Venture Monitor Report 2018 Q1

After an active 2017 for investment in US venture-backed companies, momentum in capital deployed continued in the first quarter of 2018 while the pace of companies receiving capital continued to decelerate. A total of 1,683 venture-backed companies raised $28.2 billion in funding during 1Q 2018, marking the fourth consecutive quarter of more than $20 billion deployed to venture-backed companies and the highest amount of capital deployed in a single quarter since at least 2006.
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NVCA venture MONITOR PitchBook NVCA venture venture 1Q 2Q 3Q 2Q 3Q 4Q 3Q 4Q 1Q 4Q 1Q 2Q
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NVCA venture MONITOR PitchBook NVCA venture venture 1Q 2Q 3Q 2Q 3Q 4Q 3Q 4Q 1Q 4Q 1Q 2Q
1Q 2018
An enormous $28.2B invested 
in 1Q, besting the previous 
decade high by more than $4B 
 Page 4
The definitive review of the US venture capital ecosystem covering 1Q and beyond
Though 1Q exits were slow, the 
pace is expected to increase as 
IPOs heat up and corporations 
use tax breaks for acquisitions
Page 26
SoftBank’s Vision Fund has 
made a splash. Now VCs are 
gearing up for a battle with 
mega-funds of their own
Page 29
In partnership with
Credits & Contact
PitchBook Data, Inc. 
JOHN GABBERT Founder, CEO 
ADLEY BOWDEN Vice President, 
Research & Analysis
Content 
NIZAR TARHUNI Associate Director, Research & 
Analysis 
KYLE STANFORD Analyst 
CAMERON STANFILL Analyst 
JOELLE SOSTHEIM Analyst 
MASAUN NELSON Data Analyst 
JENNIFER SAM Senior Graphic Designer 
RESEARCH 
reports@pitchbook.com
National Venture Capital Association 
(NVCA)
BOBBY FRANKLIN President & CEO
MARYAM HAQUE Senior Vice President of Industry 
Advancement
BEN VEGHTE Vice President of Communications & 
Marketing
Contact NVCA
nvca.org
nvca@nvca.org 
Silicon Valley Bank 
GREG BECKER Chief Executive Officer 
MICHAEL DESCHENEAUX President 
TRACY ISACKE Head of Corporate Relationship 
Management 
BOB BLEE Head of Corporate Finance 
MATT TROTTER Managing Director of Hardware 
and Frontier Tech 
 
Contact Silicon Valley Bank 
svb.com 
venturemonitor@svb.com
Perkins Coie 
BUDDY ARNHEIM Partner, Emerging Companies & 
Venture Capital 
FIONA BROPHY Partner, Emerging Companies & 
Venture Capital
CHARLES E. TORRES Partner, Emerging Companies 
& Venture Capital 
 
Contact Perkins Coie 
perkinscoie.com 
startuppercolator.com
 
Solium 
KEVIN SWAN VP Corporate Development 
JEREMY WRIGHT Head of Private Markets 
STEVE LIU Head of Solium Analytics 
JERON PAUL CEO, Capshare 
 
Contact Solium 
solium.com
Executive summary
3
Overview
4
Angel/seed
7
First financings
8
Solium: Cap table analytics can provide 
transparency to an opaque industry
9
Early-stage VC
10
Late-stage VC
11
Perkins Coie: Key points for client capital needs and 
liquidity in today’s venture landscape
12
Activity by region
14
Activity by sector
16
SVB: Advanced manufacturing: Can a cobot help 
you with that?
17
Life sciences
18
Corporate VC
19
Q&A: As tech disrupts traditional industries, 
corporations boost startup investment
21
Growth equity
23
SVB: What public market fluctuations signal for 
venture dealmaking
25
Exits
26
Fundraising
29
1Q league tables
32
Methodology
35
Contents
2 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Executive Summary
3 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
After an active 2017 for investment in US venture-backed companies, momentum in capital deployed continued in the first quarter 
of 2018 while the pace of companies receiving capital continued to decelerate. A total of 1,683 venture-backed companies raised 
$28.2 billion in funding during 1Q 2018, marking the fourth consecutive quarter of more than $20 billion deployed to venture-backed 
companies and the highest amount of capital deployed in a single quarter since at least 2006. 
In 1Q, 17 unicorns (i.e., companies valued at $1 billion+) attracted a combined $7.2 billion, over one-quarter of total capital deployed to 
venture-backed companies, the second-highest quarterly deal value share we have tracked. This new normal of sustained rise in capital 
deployment and fewer completed deals is a continued trend from 2017. Fewer companies receiving funding and at higher valuations 
has in turn corresponded with increased median deal sizes across all stages. In 1Q, the median early-stage deal reached $9.2 million and 
median late-stage deal reached $15 million, increases of 3.1x and 2.1x, respectively, compared to just five years ago.
Increasing deal sizes across all stages of the company growth cycle can be partly attributed to the sustained momentum in venture capital 
fundraising over the last several years, which has resulted in a combined $160 billion raised since 2014, including $7.9 billion raised in 1Q 
2018. Norwest Venture Partners’ $1.5 billion fund XIV and General Catalyst’s $1.375 billion fund IX were the largest of the 54 venture 
funds holding a final close. 
While the total amount of capital raised and number of funds closing in the first quarter—for both new and established firms—was light 
compared to recent quarters, several prominent venture firms are currently in the market raising funds with multibillion-dollar targets, 
suggesting a pickup in pace as 2018 unfolds. When factoring in these efforts to raise larger venture capital funds, as well as the ever-
increasing role of the $100 billion SoftBank Vision Fund, some investors expect overall investment into venture-backed companies to 
reach—and perhaps even surpass—the post-dot-com record from 2017.
In addition to rising expectations for another year of historical investment activity, optimism is also high for a strengthening exit 
environment that will bring long-awaited liquidity to venture investors and LPs alike. In the first quarter, there were 144 disclosed 
venture-backed M&A transactions, led by Amazon’s $1.2 billion acquisition of smart security device company Ring. While venture-
backed M&A activity was flat compared to the end of 2017, many investors expect the repatriation provision and the lower corporate 
rate included in the recently passed tax reform package to provide corporations with additional capital to make strategic acquisitions of 
venture-backed companies, which may boost M&A activity in the months ahead. 
A strong 4Q 2017 for venture-backed IPOs signaled continued optimism for 2018, which for the most part played out in the first quarter. 
In 1Q 2018, there were 15 venture-backed IPOs, led by storage platform Dropbox’s NASDAQ listing on March 23, which raised $756 
million at an $8.2 billion valuation. With a recent string of successful enterprise tech IPOs like Dropbox in 2018 and Okta, MongoDB and 
Mulesoft in 2017, and a healthy pipeline of venture-backed companies readying for IPOs, some investors believe that 2018 will likely be 
the strongest year for IPO activity in recent memory. 
Beyond the exit environment, two other areas the industry will continue to closely monitor in 2018 are: 1) the SEC crackdown on initial 
coin offerings (ICOs), which surfaced in 2017 as a potential disruptor of the venture investment model; and 2) proposed legislation that 
would affect foreign investment into venture funds and startups, which could result in a costly and opaque process and a burden on the 
ecosystem.
4 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
$37.0$27.0$31.2$44.6$41.6$47.0$71.4$81.8$75.3$82.9$28.24,707 4,465
5,378
6,734
7,865
9,226
10,467 10,558
8,824
8,652
1,693
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Deal Value ($B)
# of Deals Closed
0
500
1,000
1,500
2,000
2,500
3,000
$0
$5
$10
$15
$20
$25
$30
1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017 2018
Deal Value ($B)
# of Deals Closed
Angel/Seed
Early VC
Later VC
Overview
With over $28 billion invested into the 
US venture ecosystem, 2018 is pacing to 
extend the trends we’ve grown accustomed 
to over the last few years of total capital 
invested figures soaring to unprecedented 
levels. While the top-line count of 
completed financings declined significantly 
on a quarterly basis in 1Q, we maintain our 
conviction around the health of investment 
activity as evidenced by the stability seen 
in completed financings at both the early 
and late stage. The primary driver of the 
decline in round counts can be attributed 
to the angel market, which has continued 
to see the pace of investment decline 
rapidly since mid-2015. However, we see 
the proliferation of pre-seed investment 
activity as a key driver in the market 
that can be rather elusive from a data 
perspective as many of these deals happen 
under the radar. Thus, activity across 
some of the earliest stages of investment 
activity may be understated, and we think 
entrepreneurs are finding novel avenues to 
finance new ideas and business ventures. 
Late-stage activity remains poised for 
another notable company fundraising 
year. Unicorn activity represented over 
21% of all venture capital invested in the 
US in 2017, with more than $17.5 billion* 
deployed into companies valued over $1 
billion during the period. Through the first 
quarter of 2018, activity in that subset of 
the market remains on track to surpass 
2017’s record total. Investors have piled 
roughly $5 billion in net new* capital into 
such companies, accounting for over 18% 
of all capital invested in the US last quarter. 
More invested in 1Q 2018 than in full-year 2009 
US VC activity
1Q marks fourth consecutive quarter with more than $20B invested 
US VC activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor
*two rounds previously closed in 4Q have been adjusted to a 1Q 2018 close due to more capital being added
5 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
PE continues to be highly involved 
US VC activity with PE participation
Strong start to year for unicorns 
US unicorn activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018 
**Amount includes $2.5 billion from two rounds originally closed in 4Q 2017
While late-stage investments in unicorn 
companies have become more prominent 
given the growing age of privately held 
businesses, round sizes of $1 billion+ 
certainly have not. That said, 1Q alone 
saw three such transactions close, with 
both Lyft and Faraday Future holding final 
closes on rounds launched in 4Q at $1.7 
billion and $1.5 billion, respectively, and 
Uber closing a $1.25 billion round. For 
comparison, 2017 in its entirety saw just 
three completed financings of $1 billion or 
more. Moving forward, we think rounds 
of this magnitude will still remain outliers. 
Moreover, as behemoths such as Uber tap 
investors for massive rounds, one item 
that should be noted is that not all of that 
money is primary capital being used to fund 
operations. Rather, an increased proportion 
of some of these rounds represents 
secondary capital where certain investors 
and employees are finding avenues to 
generate liquidity as hold periods have 
lengthened and exit processes have been 
delayed. 
Last, private equity continues to play an 
increasing role in the venture market. $8.5 
billion worth of transactions last quarter 
involved PE investors, the highest figure 
we’ve tracked since mid-2012, despite 
these firms participating in just 8% of 
VC financings. On the exit front, the 
proportion of completed VC-backed sales 
to PE declined relative to what we saw in 
2017, during which the highest percentage 
of exits were completed to PE firms that 
we’ve ever tracked. Given we are still early 
in the year, however, we fully expect to 
see increased activity by PE groups in the 
venture markets similar to what we saw in 
2017 for the following reasons. 
Through the first quarter of the year, 15% 
of all completed PE transactions were 
done in the software space, which is up 
relative to the 12% number we’ve seen 
historically. Further, the PE transaction 
ecosystem continues to support such deals, 
particularly as companies have been able 
to establish recurring revenue, cashflow 
positive and cash-efficient software 
businesses that fit nicely with the debt 
structures PE firms typically utilize to 
complete leveraged buyouts. As roughly 
40% of all venture transactions consistently 
occur in the software space, the venture 
markets will continue to provide a fertile 
sourcing ground for PE firms looking to 
locate quality software targets.
Early-stage rounds grow in size by roughly 50% 
Median deals size ($M) by stage
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
$11.0$6.8$6.6$12.2$9.1$9.9$19.3$26.6$25.7$23.1$8.5663
451
424
515
556
619
749
764
652
642
139
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Deal Value ($B)
# of Deals Closed
$6.6$2.4$2.6$13.6$17.0$18.6$17.5$7.2**7
7
9
28
24
23
71
81
55
75
17
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Deal Value ($B)
# of Deals Closed
$1.0
$1.4
$6.0
$9.2
$11.1
$15.0
$0
$2
$4
$6
$8
$10
$12
$14
$16
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Angel/Seed
Early VC
Late VC
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7 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
$449$407$394$669$675$629$541$750$849$1,115$1,253$871$1,462$1,086$1,344$1,555$1,289$1,416$2,045$1,846$2,061$2,146$2,109$1,936$1,671$1,714$1,719$1,548$1,587$1,690$1,895$1,808$1,6240
200
400
600
800
1,000
1,200
1,400
1,600
$0
$500
$1,000
$1,500
$2,000
$2,500
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Deal Value ($B)
# of Deals Closed
Angel & seed activity drops 
US angel & seed activity
Angel & seed
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
$0.58
$0.86
$1.69
$2.20
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017 2018*
Angel
Seed
Median seed deal surpasses $2M 
Median US angel & seed deal size ($M)
Despite deal count across the angel/
seed market continuing to decline, deal 
value at the stage has remained relatively 
heightened. The $1.6 billion raised in 1Q 
marks the 15th straight quarter that more 
than $1.5 billion was invested into angel/
seed deals. In fact, no less than $1 billion 
has been invested in the stage during each 
quarter since 4Q 2012. Prior to that period, 
the $1 billion mark had only been reached 
three times in our datasets. 
Seed deals have reached a median 
transaction size of $2.2 million and a 
median post-money valuation of $10.7 
million, far and away the largest we have 
recorded. Record-sized seed funds continue 
to underpin capital availability at the stage. 
For instance, Sequoia Capital closed a $180 
million seed fund in January, while Khosla 
Ventures has announced it is raising a $400 
million seed vehicle as well. In addition, we 
have seen various other firms continue 
investing in seed deals despite running $1 
billion+ vehicles. While writing seed-sized 
checks could appear as a peculiar strategy 
for some of the larger funds, the Dropbox 
IPO serves as a good example of why such 
transactions can still be a valuable portion 
of a larger firm’s investment strategy. To 
illustrate, Sequoia realized around $2 billion 
from Dropbox’s IPO, a company it has held 
in its portfolio since participating in its 
2007 seed round.
The heightened deal sizes and valuations 
are also being driven up by the continued 
aging of companies raising early-stage 
institutional capital. The median age of 
companies raising angel & seed funding in 
1Q came in at three years post founding, 
older than the median age of a company 
raising a Series A round in 2014, and nearly 
double the age of a company raising an 
angel/seed deal in 2011. This shift in age 
isn’t so much of a trend as it is a change to 
the traditional investment timeline. Many 
startups require less capital for operation 
than before, specifically many software 
companies that can run cloud servers and 
hire freelancers until full-time engineers are 
necessary. This in turn allows businesses 
to be more developed when first engaging 
institutional investors, garnering larger 
deals and valuations.
8 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
$1.4$1.0$1.0$1.2$1.9$1.3$1.5$1.5$1.6$2.1$1.9$1.5$2.1$1.6$1.5$2.0$1.8$1.7$2.2$2.0$2.0$2.4$2.1$2.3$1.8$1.7$2.0$1.6$1.8$2.1$1.6$2.0$2.40
200
400
600
800
1,000
1,200
 $0
 $0.5
 $1.0
 $1.5
 $2.0
 $2.5
 $3.0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Deal Value ($B)
# of Deals Closed
First financings
0
2,000
4,000
6,000
8,000
10,000
12,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
First Financings
Follow-on Financings
First financings continue to decline 
First financing vs. follow-on deal by count
The number of startups receiving their first round each year has slowly declined 
US first-financing activity
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
First Financings
Follow-on Financings
Angel/seed deals have fallen furthest 
US first-financing VC rounds (#) by stage
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor
9 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Cap table analytics can provide 
transparency to an opaque industry 
Companies like Capshare are releasing large 
descriptive data sets about startup cap 
tables for the first time. The data, based on 
thousands of cap tables, provides an insider 
view of how equity is actually structured in 
startups. 
The data show that cap tables evolve in fairly 
predictable ways as the company grows. For 
example, employee ownership decreases 
from 100% at founding to approximately 
70% in the seed round and starts to level off 
around 38% by Series C financings.
Employee ownership (and by extension, 
investor ownership) is so predictable that 
it almost perfectly fits a log trend line. This 
math can help both VCs and founders 
understand typical dilution, as well as 
calm jittery founders by helping them to 
understand that although they will likely 
experience significant dilution, they can also 
still expect very high personal returns in the 
end.
Other predictable aspects of cap tables 
include option pools. Option pools are 
typically set up before seed rounds are 
completed. Once they are established, they 
typically hover around 15% of the total 
capitalization of the company (including 
issued and unissued options) throughout 
the startup’s lifecycle. Unissued options 
decrease slightly as a proportion of total 
options as the company grows—but only just 
slightly. Capshare data shows that Series A 
companies have on average 6% of the total 
capitalization of the company available for 
new hires, while Series C companies have 
only 3%.
But cap table data also revealed a few 
surprises, especially around waterfall 
analysis. Waterfall analysis takes an assumed 
value of the company as an input and then 
shows you exactly what amount of that 
value each shareholder would be entitled to 
receive. 
For example, you could assume a company 
is worth whatever its last post-money 
valuation was and then run a waterfall 
analysis. When we did this we found a tale 
of two kinds of startups. Generally, startup 
averages are often skewed upward by the 
highest performing startups, and that is true 
in waterfall values as well.
Th graph on the right shows aggregate 
waterfall value to founders based on the 
stage of company. When looking at both the 
mean value and the median value, the mean 
value will be much more affected by the 
higher performing startups, while median is 
probably a truer representation of a typical 
startup. As the graph points out, the median 
founder waterfall value plateau around 
Series B and doesn’t really increase much 
after. However, for those founders in highly 
successful startups, the value of their shares 
continues to grow rapidly as the company 
moves further along the venture lifecycle.
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100%
73%
60%
43%
37%
36%
0%
20%
40%
60%
80%
100%
120%
Common
Seed
Series A
Series B
Series C
Series D+
Median
Log.
(Median)
Employees dilute quickly 
Employee ownership by stage
1%
7%
7%
8%
11%
11%
9%
7%
6%
8%
6%
4%
3%
5%
0%
2%
4%
6%
8%
10%
12%
14%
16%
Common Common +
Convertibles
Seed
Series A
Series B Series C Series D+
Unissued
Issued
15% option pool typical 
Issued & unissued options by stage
Founder median peaks early 
Aggregate founder waterfall values ($M) by stage
$2.8
$2.0
$5.0
$16.8
$19.5
$24.7
$42.0
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
Common Common +
Convertibles
Seed
Series A
Series B
Series C Series D+
Average
Median
Jeron Paul, Founder and CEO, Capshare
Source: Capshare
Source: Capshare
Source: Capshare
10 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Early-stage VC
$2.9$2.5$2.6$2.5$3.3$2.9$3.5$3.8$3.0$3.6$3.1$3.1$3.5$3.7$3.4$4.4$4.6$5.1$5.0$5.5$4.9$7.3$6.3$6.2$6.2$6.5$6.1$5.0$5.7$6.7$7.8$9.5$9.90
100
200
300
400
500
600
700
800
900
$0
$2
$4
$6
$8
$10
$12
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Deal Value ($B)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$25M+
$10M-
$25M
$5M-
$10M
$1M-
$5M
$500K-
$1M
Under
$500K
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$25M+
$10M-
$25M
$5M-
$10M
$1M-
$5M
$500K-
$1M
Under
$500K
81 deals of at least $25M in 1Q 
US early-stage activity (#) by size
Deals <$10M account for 11% of value 
US early-stage activity ($) by size
Over $9B was invested at the early stage during each of past two quarters 
US early-stage VC activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor
For two consecutive quarters now, the 
early stage has received more than 
$9 billion in investment, far and away 
the highest totals we have seen. For 
comparison, 2010 saw a total of $10.5 
billion invested throughout the entire 
year, and prior to 4Q 2017 there had never 
been a quarter with more than $8 billion 
invested. Some of this enormous growth 
is due to just a few deals over the past few 
quarters, but taking out the largest deals 
won’t change the trend. Early-stage deals 
are simply getting larger. The median age of 
companies that raised a Series A or Series 
B round in 1Q reached 3.3 and 5.1 years, 
respectively. Both are more than a year 
older than companies raising at the same 
stage a decade ago. “Seed is the new Series 
A” was a common thought a few years ago, 
and that seems more and more plausible as 
time goes. Capital availability has filtered 
down to the earliest stages of VC, and the 
ripple effect has manifested in growing deal 
sizes as venture investment shifts further 
into the business lifecycle. We believe that 
this trend will persist as businesses come 
to the early stage better capitalized with 
strong plans for growth. 
$4.4$5.9$4.0$4.5$9.4$6.6$7.4$5.0$5.9$6.6$6.3$6.0$6.2$6.7$7.1$6.6$9.1$13.4$9.8$12.2$13.0$11.2$14.0$10.6$11.7$15.7$9.8$7.7$9.6$13.4$13.2$10.0$16.70
100
200
300
400
500
600
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Deal Value ($B)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$50M+
$25M-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
11 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Late-stage VC
Deal size growth clearly visible  
US late-stage activity (#) by size
Late-stage deal value has stayed at historic highs 
US late-stage activity
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
The late-stage continues to be an example 
of and realization of the robust US 
fundraising environment, along with the 
increased appetite for venture investment 
across the capital markets. 76 late-stage 
rounds of $50 million+ were raised in 
1Q, including 41 of $100 million or more, 
contributing more than 70% 1Q late-stage 
deal value, roughly double the proportion 
seen in 2012. 
Over the past four years, more than $150 
billion has been raised by US VC funds, a 
figure that doesn’t seem outlandish when 
comparing it to the elevated investment 
totals from those years. More than $10 
billion in late-stage capital has been 
invested in all but four quarters since 2Q 
2014, an amount that hadn’t been reached 
in any other quarter since at least 2006 and 
likely since the dot-com bubble in 2000. 
Several funds either new to the market 
or currently being raised will undoubtedly 
help continue this trend. Sequoia Capital 
is looking to raise up to $12 billion across 
several funds, Khosla Ventures is raising 
a $1 billion fund to go along with its $400 
million seed vehicle, and other firms that 
will be investing out of $1 billion+ funds 
include Battery Ventures and General 
Catalyst. While mega-funds aren’t new, 
they will likely increase in count and size 
in order to keep up with the late-stage 
investment strategy of SoftBank’s Vision 
Fund, which currently has little competition 
for its multi-hundred-million-dollar late-
stage deals. For context, SoftBank’s 1Q 
2018 deals had an aggregate value of $3.4 
billion, not including its $8 billion secondary 
investment in Uber.
While the IPO market appears to be 
improving and optimism for tax-driven 
acquisition strategies has increased, exit 
activity continues to subside. Just three 
companies were acquired during the 
quarter for more than $300 million, while 
15 late-stage rounds were completed 
on at least that amount. The grow-at-all-
costs movement has left many late-stage 
companies needing to continue raising 
capital to focus on revenue growth and 
monetization of their platforms, making 
further private capital raises the likeliest 
bet in current conditions.
12 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Key points for client capital needs and 
liquidity in today’s venture landscape
The US venture capital industry continues 
to evolve. In response to record amounts 
of capital deployed into early-stage 
companies, coupled with fewer (and later) 
traditional exit events, we have begun 
to see a growing interest in changes to 
investment and executive compensation 
structures. With $150 billion+ in VC funds 
raised over the past few years alone, the 
industry has been left with excessive 
capital available across the entire lifecycle, 
leading to concerns over overfunding 
and limited release valves for future exits. 
The recent rise in active participation of 
nontraditional VC investors has only added 
fuel to that fire. But while in many ways the 
discussion has focused on the late stage, 
the broader market and earliest stages of 
funding are benefiting from that increase, 
while also encountering new challenges 
that accompany such benefits. 
The challenges, however, present an 
interesting opportunity for the industry 
and ecosystem to evolve. As companies 
move through their lifecycles, advanced 
planning and preparing remains an 
important part of each new round. The 
increase in strategic, family office, private 
equity and hedge fund participants (to 
name a few) in early stages has broaden the 
range of various investor attributes such as 
desired rates of return, timelines to return, 
and risk profiles. Accordingly, selecting and 
courting the right mix of investors to hedge 
contrasting investor attributes makes 
planning for the next round a critical part 
of planning and negotiating any company’s 
current round is more important than 
ever. Establishing guidelines for the many 
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interests at the table is critical for setting 
reasonable expectations of a company’s 
long-term strategy.
Investor Diversity Brings Stability
With traditional institutional venture 
capital firms increasingly focused on later 
stage investments, companies raise several 
millions of dollars before they begin their 
search for institutional capital to lead their 
Series A rounds. As previously mentioned, 
this is at least partially because angels 
and pre-seed funds are no longer the only 
material players involved at the earliest 
stages. 
Family offices, strategic partners and other 
sources of capital historically uninterested 
in seed-stage financings have entered the 
arena, pumping money and growth into 
startups well before traditional venture 
capital is ever invested. Investment from 
so many different parties can generate 
challenges, but the diversity of a startup’s 
investor base can yield stability around 
future capital and liquidity needs during 
both good times and bad. Many active 
angels, for example, can get a company off 
the ground, but far fewer have sufficient 
capital that can be deployed into future 
follow-on rounds. Their smaller risk 
tolerance also makes angels a relatively 
unreliable source for future capital needs 
if the company needs a boost during rough 
times to hit the benchmarks they had 
hoped to reach with the first investment. 
Charles E. Torres, Partner, Emerging Companies & Venture Capital, Perkins Coie
6.4
6.1
5.4
5.0
 4.0
 4.5
 5.0
 5.5
 6.0
 6.5
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017 2018*
Average
Median
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018 
As exit times lengthen, planning ahead is important 
Median and average time to exit (years)
13 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
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Conversely, the new class of early-stage 
participants tend to have different, or even 
opposite, appetites, expectations and 
tolerances.
Accordingly, a diversified group of 
investors allows a company to consider a 
variety of investment timelines and blend 
expectations by having those with deeper 
pockets “decrease” the expected liquidity 
timelines of less patient investors. Strategic 
partners and family offices generally 
invest with more patient capital and can 
complement an investor group due to their 
lesser need for a quick return. Differing 
return timelines provide the opportunity 
for startups to build the company through 
slower, more sustainable means to continue 
raising private capital without investors 
clamoring for an exit. As the venture 
timeline lengthens, a pure exit is not always 
just over the horizon or even part of the 
plan. In this case, the stability of long-term 
capital can help continue to support the 
founder’s vision.
Planning Future Raises is Crucial
Planning ahead is less obvious than 
one might think. During an era of high 
valuations and deal sizes, the direction 
of the company can be lost to clouded 
vision and oversized checks. But taking 
the time to plan out two capital raises 
down the line can keep the business 
on the correct forward path, which is 
instrumental in aligning the interests of all 
parties. Of course, planning for how to get 
the company through the next round of 
investment will make business operations 
run smoother and keep a process in place 
for how to best handle adversity, but 
modeling out the next two rounds will also 
make teams think through strategies and 
align capital expectations for both investors 
and founders on how much capital will 
be best for the company to take on, as 
prospective valuations, new capital and 
dilution will weigh heavily on a company’s 
growth or exit strategy.
Successfully aligning everyone’s 
interests and expectations is one pillar 
of a successful planning process. As 
time goes on, management can become 
disincentivised. Along the same vein, the 
amount of capital being introduced into the 
industry can be potentially damaging to 
the investor-founder relationship, should 
one side view capital usage to be skewed in 
favor of the founders over the investors (or 
a particular class of investors). 
Seek to Implement and Encourage 
Liquidity and Incentive Strategies
Enhancing upside through option and other 
management incentive pools, including 
refreshing such pools as needed, can 
keep management engaged for the long 
term. Simultaneously providing liquidity 
to founders with secondary repurchases 
and sales can also reduce unhelpful 
stressors and resolve tensions. Conversely, 
I’ve started exploring the novel idea of 
secondary offering participation rights, 
which provide less patient investors with 
greater certainty that they can participate 
in any secondary offering, because that 
helps them in a similar and reciprocal 
manner. The transparent discussion and 
provision of these pre-exit liquidity rights 
increases the chance that founders and 
investors will find some early liquidity, pare 
down their crowded capitalization tables 
(which are increasingly filled with equity 
issued pursuant to convertible securities) 
and bring in fresh, long-term investors, all at 
the same time. 
As companies move along the venture 
lifecycle, exits at some point move to 
the forefront of discussion and business 
positioning. The high volume of capital 
availability has created a backlog of 
companies in the market that will likely 
move toward exit in the near term. While 
the IPO market looks to be rebounding 
at the moment after two less-than-stellar 
years, and recently passed tax legislation 
has also left corporations with extra cash 
to spend on acquisitions, such a decision 
should be approached with caution. The 
public markets have proven tumultuous, 
and running a public company (or part of a 
public company, if acquired by one) is not a 
job fit for (or desired by) everyone. When it 
comes time to begin the process of talking 
about a future exit, the investors and the 
management team need to understand 
where the other stands on the issues of 
both the timing and type of an exit.  
14 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
West Coast nears $17B in 1Q value 
1Q US VC deal activity by region
Despite opportunities outside traditional VC hubs, few trends have changed 
1Q 2018 US VC deal activity by region
Activity by region
PitchBook-NVCA Venture Monitor 
San Francisco sees value share surge 
Percentage of deal value ($) by MSA
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018 
West Coast
39.0% of 1Q Deals
59.9% of 1Q Deal Value
Mountain
7.2% of 1Q Deals
2.4% of 1Q Deal Value
Midwest
1.4% of 1Q Deals
0.7% of 1Q Deal Value
Great Lakes
8.5%of 1Q Deals
2.6% of 1Q Deal Value
Mid-Atlantic
21.3% of 1Q Deals
15.6% of 1Q Deal Value
New England
9.3% of 1Q Deals
10.3% of 1Q Deal Value
Southeast
6.6% of 1Q Deals
5.8% of 1Q Deal Value
South
6.6% of 1Q Deals
2.7% of 1Q Deal Value
30.5%
36.9%
5.8%
11.9%
10.9%
9.8%
14.9%
9.4%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
San Francisco
Los Angeles
Boston
New York
Region
Deal Count
Deal Value ($M)
Great Lakes
144
722.9
Mid-Atlantic
361
4,405.2
Midwest
23
196.8
Mountain
122
674.5
New England
158
2,899.6
South
112
774.6
Southeast
111
1,649.6
West Coast
661
16,920.6
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16 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Activity by sector
0
2,000
4,000
6,000
8,000
10,000
12,000
20082009201020112012201320142015201620172018*Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Sector investment trends remain stable 
US VC activity (#) by sector
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
20082009201020112012201320142015201620172018*Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
HC devices starts year off slow 
US VC activity ($B) by sector
7.1%
8.0%
38.4%
39.6%
6.2% 6.2%
25.5% 25.6%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Pharma & biotech
Software
HC devices & supplies
Other
Software continues with most deals 
Top sectors as % of total VC (#)
15.5%
16.3%
35.7%
41.5%
5.7% 4.9%
23.2%23.4%
0%
10%
20%
30%
40%
50%
60%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Pharma & biotech
Software
HC devices & supplies
Other
65% of deal value invested in two sectors 
Top sectors as % of total VC ($)
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
17 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
As the move to automate manufacturing 
intensifies, we are witnessing the rise of 
cobots. Cobots, as the name implies, are 
robots deployed alongside human workers 
to assist them in a variety of tasks, adding 
flexibility and cost efficiency. Investors 
are taking note, as initiatives like Industry 
4.0 take hold and the use of advanced 
manufacturing technologies explodes. The 
collaborative robotics market is growing 
at a CAGR of 57.4% and is now projected 
to reach $4.4 billion by 2023, up 25x from 
2016. 
Once the cornerstone of the US economy, 
manufacturing has declined precipitously 
from its peak four decades ago. At the 
sector’s height, US manufacturing jobs 
totaled nearly 20 million, or 22% of 
US employment. Driven by off shore 
manufacturing and, more recently, 
automation, by February 2018 there were 
12 million US manufacturing jobs, or about 
8.5% of all US jobs. However, there is a 
new type of automation emerging that is 
designed not to replace human workers but 
to complement them, and the jobs decline 
is starting to reverse.
The adoption of cobots is primarily driven 
by small and medium-sized businesses. 
Manufacturing tasks in these businesses 
tend to be more flexible and operations 
more easily modified, making the cost 
of integrating cobots more manageable. 
Cobots are designed to assist human 
workers with a variety of low-skill tasks, 
including machine tending, material 
handling, assembly tasks and packaging, 
and are designed to be “aware” of their 
surroundings so as not to interfere with or 
harm human workers. An added benefit is 
that there isn’t a need to set up designated 
areas for robot-only operations, which is 
costly and can add inefficiencies to the 
production process.
The hourly cost of cobots is also 
competitive with that of manufacturing in 
China, allowing US-based manufacturers to 
add incremental capacity in an affordable 
way. Given the pressure to reduce the 
cost of manufacturing and production, the 
flexibility afforded by cobots collaborating 
with human workers makes cobots an 
attractive solution. 
Investment opportunities grow in 
advanced manufacturing 
The potential of machine-human 
interaction in the workplace is driving 
investor interest in this developing area of 
robotics. The number of VC investments in 
advanced manufacturing took off in early 
2014, with a large proportion flowing to 
robot developers and manufacturers. 
Investment in advanced manufacturing in 
4Q 2017 reached a record $461 million as 
more mainstream VC investors became 
active in applied robotics. Driving this 
trend is a growth in short-term market 
opportunities, unit economics and 
recurring revenue. Traditional hardware 
companies tended to sell their products in 
single transactions. These days, however, 
robotics companies are adopting a HAAS 
business model, which effectively spreads 
the cost over a contracted period and 
allows companies to bundle other services 
such as software packages, maintenance 
services and replacement parts. The HAAS 
model also gives robotics companies a 
more predictable revenue stream, giving 
startups a greater ability to compete with 
large established OEMs that have greater 
financial resources.
Rethink Robotics and AUBO Robotics 
are two US-based, VC-backed startups 
leading the cobot revolution. They are 
competing with an international assortment 
of companies, including Universal Robots 
(Denmark); KUKA Robotics Corporation, 
MRK-Systeme and Bosch (Germany); ABB, 
MABI Robotic and F&P Personal Robotics 
(Switzerland); and FANUC and Kawada 
Industries (Japan). 
As collaborative robots emerge, investors 
should keep in mind that they are just 
one piece of the automation puzzle. The 
advancement of cobots and robots, for 
example, is directly linked to developments 
in AI, robotics and sensor technology. 
Supporting subsectors include RFID tagging, 
monitoring, predictive analytics, inventory 
and ERP systems, as well as industrial 
IoT. Ultimately, the combination of these 
technologies will shape the factories of the 
future.
Advanced manufacturing: Can a cobot 
help you with that?
0
5
10
15
20
25
30
$0
$50
$100
$150
$200
$250
$300
$350
$400
$450
$500
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2012
2013
2014
2015
2016
2017
2018
Deal Value ($M)
# of Deals Closed
Sector has seen marked uptick in deal values recently 
US VC activity in advanced manufacturing
PitchBook-NVCA Venture Monitor 
Matt Trotter, Managing Director of Hardware and Frontier Tech, Silicon Valley Bank
18 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Life sciences
$9.2$7.9$7.7$8.6$8.7$9.7$12.4$14.9$12.6$17.6$6.0870 869
952
1,018
1,086
1,148
1,221
1,258
1,094
1,155
241
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Deal Value ($B)
# of Deals Closed
LS investment reaching new heights 
US VC activity in life sciences
0
200
400
600
800
1,000
1,200
1,400
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Pharma & Biotech
HC Devices & Supplies
Investment split between sectors 
US VC activity in life sciences (#) by sector
13.3%
14.2%
0%
5%
10%
15%
20%
25%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
As other sectors fall, LS increases share 
US VC activity in life sciences as percent of total VC
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
LS deals increasing along trends 
US VC activity in life sciences (#) by size
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
Policy changing CVC in life sciences
After 2017’s record participation of 
corporate investors in VC deals, capital 
invested continues to sustain elevated 
levels, with deals involving CVCs totaling 
$14.1 billion as of 1Q. However, after three 
years of strong activity, the CVC deal 
count in the first quarter declined 15% 
YoY, resting at 302 closed deals. Similar 
to trends we’ve seen over the past few 
quarters, the software and life sciences 
sectors (pharma & biotech, and healthcare 
devices & supplies) remain favorites for 
corporate VCs. 
Consistent with activity from the last four 
years, deals closed by life sciences startups 
accounted for nearly 16% of all CVC deals 
and 22% of capital invested in 1Q. Due to 
biotech’s capital intensity and high failure 
rates, we believe venture activity remains 
strong in the space because investing 
in drug or technology development via 
startups tends to be more cost effective 
than internal research and development for 
incumbent corporations. Additionally, larger 
healthcare companies do not typically have 
the same agility to innovate at the same 
rate as smaller, leaner startup companies. 
Consequently, we find that life sciences 
startups tend to have a stronger rate of 
acquisition by their CVC backers compared 
to non-life sciences startups. In 2017, 
9.4% of life science startups that received 
corporate funding were acquired by the 
sponsoring corporation, whereas only 6% 
of non-life science startups had the same 
outcome. This has been a long-term trend, 
as life science startups have exceeded non-
life science startups in acquisition rates by 
a corporate funder for seven of the last ten 
years. 
19 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Corporate VC
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
Corporate VC sees largest quarterly deal value to date 
US corporate VC participation activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
$10.3$6.5$8.1$13.2$12.2$15.1$27.3$37.2$34.6$37.2$14.1699
497
577
738
863
1,095
1,338
1,468
1,351
1,370
302
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Deal Value ($B)
# of Deals Closed
9.4%
20.0%
6.0%
11.8%
0%
5%
10%
15%
20%
25%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Life Sciences
Non-Life Sciences
Life sciences leads in follow-on acquisitions 
Acquisition made by CVC or parent corporation
0
5
10
15
20
25
30
35
40
45
50
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
IPO
Buyout by Other
Acquired by Other
Acquired by Corporate Investor
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
Most companies acquired by outside firm 
CVC investment exits (#) by type
Changes in the regulatory environment 
driven by new leadership in the FDA 
have the potential to change life sciences 
investment by CVCs or parent companies. 
Under its new leadership, the FDA has 
prioritized faster and more efficient drug 
approval processes. Given that one of the 
greatest costs of drug creation is clearing 
regulatory approval, these developments 
can reduce R&D costs to both startups 
and large incumbents. On one hand, this 
could encourage continued investment by 
CVCs, as startups will theoretically be able 
to stretch funding dollars further and reach 
milestones faster. However, a faster and 
less expensive route to drug approval could 
also incentivize incumbents to focus on 
internal development instead.
20 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$50M+
$25M-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
Many CVC deals occur at late stage 
US corporate VC activity (#) by size
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$50M+
$25M-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
Unicorn deals account for high % of CVC 
US corporate VC activity ($) by size
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
0
50
100
150
200
250
300
350
400
450
$0
$2
$4
$6
$8
$10
$12
$14
$16
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Deal Value ($B)
# of Deals Closed
Angel/Seed
Early VC
Late VC
Similar to overall VC, CVC deal count has slid while value has risen 
US corporate VC participation activity
21 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
As tech disrupts traditional industries, 
corporations boost startup investment 
Q&A with Tracy Isacke, Head of Corporate Relationship Management, Silicon Valley Bank
Why is corporate venture valuable for 
promoting innovation?
The speed of innovation and disruption 
is accelerating. Large corporates and 
their industries are being challenged by 
incredibly nimble startups that often 
look to pick off pieces around the edges 
of a business before coming to dominate 
an entire industry. To compete, some 
corporations have created in-house 
“startups,” but many larger corporations 
now recognize that internal innovation 
alone is not enough. They view promising 
startups as potential partners in their bid to 
push the innovation envelope and, in turn, 
are creating corporate venture capital arms. 
A decade ago, it was very hard and 
expensive for startups to scale and 
compete with large multinational 
organizations. Since then, the barriers to 
entry and growth have fundamentally 
changed, as mobile and cloud technologies 
and the drop in computing costs are all 
creating incredible opportunities to scale 
businesses at a faster pace and at a fraction 
of the cost. The ability to scale also has 
accelerated with the ease of access to 
capital. Now, as many startups are scaling 
more efficiently, corporates have realized 
it’s in their strategic interests to foster 
value creation through partnerships, 
investments and acquisitions. 
The takeaway is that new market and 
innovation models are keeping even the 
most established companies on their toes. 
This is very good news for entrepreneurs 
and the VC funding landscape overall: 
Venture dollars, corporate expertise, and 
access to customers and distribution 
channels are flowing to almost every 
industry and fueling innovation. 
your KPIs strategic, financial or a blend of 
both? Often, it’s most sensible to pursue 
a smart balance. The term “strategic” is 
often mistranslated as a lack of concern for 
financial success when, in fact, it should 
signal a strong alignment with business 
initiatives, including profitability. 
Beyond succinctly defining your goals, 
clarity about your approach is also 
paramount. It’s important to understand 
what areas you care to invest in, articulate 
the decision-making process and 
communicate how you plan to differentiate 
yourself as a source of value-added capital 
to the startups. Finally, it’s very important 
not to treat corporate venture investment 
as a P&L within the core business. 
Traditional VC investors take a long-term 
view of gaining returns from their portfolio 
investments, and corporate investors 
should adopt the same level of patience.
At a time of increasing disruption, corporations must innovate to survive, and many are doing so by partnering with top startup 
entrepreneurs and founders. In this edition, we ask Tracy Isacke, Head of Corporate Relationship Management at Silicon Valley Bank, 
about the hottest trends and upcoming opportunities for corporate venture capital in the global innovation ecosystem.
In your experience, what strategies enable 
CVC arms to be successful?
CVC success requires a strong commitment 
from executives at the top of the 
organization. Trying to set up a CVC arm 
with half measures—minimal funding, 
slow decision-making, lack of C-suite 
champions—is typically a recipe for failure. 
A key question to resolve at the start: Are 
...barriers to entry and 
growth have fundamentally 
changed, as mobile and 
cloud technologies and the 
drop in computing costs 
are all creating incredible 
opportunities to scale 
businesses at a faster pace 
and at a fraction of the cost.
It’s important to 
understand what areas you 
care to invest in, articulate 
the decision-making process 
and communicate how you 
plan to differentiate yourself...
For more than 30 years, Silicon Valley Bank (SVB) has helped innovative companies and their investors move bold ideas forward, fast. SVB provides targeted 
financial services and expertise through its offices in innovation centers around the world. With commercial, international and private banking services, SVB helps 
address the unique needs of innovators. Learn more at svb.com. 
©2018 SVB Financial Group. All rights reserved. SVB, SVB FINANCIAL GROUP, SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are 
trademarks of SVB Financial Group, used under license. Silicon Valley Bank is a member of the FDIC and the Federal Reserve System. Silicon Valley Bank is the 
California bank subsidiary of SVB Financial Group (Nasdaq: SIVB).
22 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Many corporations have essentially 
joined the ranks of VC investors, adding 
investment teams and dedicated funds, 
but sometimes their goals veer from 
those of traditional VCs. Strategies and 
return profiles may differ. Is CVC growth 
ultimately good for the VC industry as a 
whole, and what effects have you seen? 
It depends. When corporates get it right, 
and they understand the value they can 
bring to a startup partner or an entire 
industry, then I think they truly have 
the ability to change the trajectory of a 
company or a market for the better. Having 
a partner—for example, a corporate investor 
who works in a larger organization, has 
critical subject matter expertise and can 
ask second- and third-order questions—can 
be significant when setting up a startup for 
long-term success. Having a partner who 
truly understands your business can lead 
to great working dynamics and help build 
a strong board. That said, if corporates fail 
to set or articulate their expectations or 
execute on their promises, founders and 
traditional VC investors are frustrated. 
Tracy Isacke joined Silicon Valley Bank in 2014 and leads the company’s 
Corporate Relationship Management Group, which was established in 2009 to 
build connections between investment groups at some of the world’s largest 
companies and emerging technology and life science startups. 
As head of the group, Tracy is responsible for Silicon Valley Bank’s relationships with corporate 
venture funds, corporate development teams and innovation groups at Fortune 500 companies.
Prior to joining SVB, Tracy was EVP New Business Ventures at Telefónica Digital where 
she identified investment opportunities in Silicon Valley, Israel and Europe with potential 
to accelerate Telefónica’s business. She also drove an international Global Partner team to 
deliver unique partnerships and Direct-to-Bill opportunities for Telefónica across 25 operating 
businesses in Europe and Latin America. 
Again, that’s why mission, structure and 
approach are so important for corporates 
to carefully define upfront. Understanding 
how and when to come in as a strategic 
investor is another key decision: Will you 
add more value at the seed round or at 
Series A or B? Should you be leading the 
round? Have you set aside follow-on 
investment funding, even if the company 
veers away from your strategic direction?
Planned well and with the right team in 
place, I think CVC arms provide a fantastic 
source of support and scale for startups 
that traditional VCs may not be able to 
match. From sharing leads for channel 
partners and customers to promoting pilot 
opportunities, CVC arms bring a wealth of 
value beyond their capital. 
How have executives’ perspectives 
changed in the past decade? 
My belief is that all corporates, in every 
single industry, do not feel safe. Previously, 
a large company executive could afford 
to be a little dismissive of the founders 
walking in with big claims of how they 
were going to disrupt an industry. Now, 
we have so many examples of startups 
doing just that. Corporates have a very 
different perspective today: Innovation and 
partnership have become imperative, not 
optional.
Corporate venture initiatives are 
becoming more professional, including 
building blended teams of investors who 
understand both the corporate and the 
What role does SVB play in helping 
corporates connect with the innovation 
economy? How do you act as a strategic 
partner for corporations?
We sit at the heart of this incredible 
intersection of startups, VC investors 
and corporates, and this creates a true 
innovation network. We have deep 
knowledge and understanding of a variety 
of industries and share our contacts, 
analysis and observations through highly 
curated events, tailored introductions 
and meetings, and unique market insights. 
We also act as a strategic partner and 
consultant, should corporates seek help 
designing their approach to innovation, 
such as how to identify the best working 
model, who to tap for support and how 
to create lasting impact. We work with 
a number of partners and can also help 
corporates navigate the “existential crises” 
that are bound to appear when thriving in 
disruption.
Planned well and with the 
right team in place, I think 
CVC arms provide a fantastic 
source of support and scale 
for startups that traditional 
VCs may not be able to match.
We sit at the heart of this 
incredible intersection of 
startups, VC investors and 
corporates, and this creates a 
true innovation network.
venture worlds and what it takes to create 
effective partnerships with their portfolio 
companies. 
23 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Growth equity
$3.9$9.3$3.8$2.7$9.5$5.6$5.7$6.3$3.9$6.6$9.2$5.9$7.2$6.9$5.6$6.0$9.1$12.9$14.0$10.1$11.8$12.4$13.8$10.3$12.0$15.8$6.6$9.6$8.7$15.6$12.0$9.4$14.60
50
100
150
200
250
300
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Deal Value ($B)
# of Deals Closed
GE on pace for fifth straight year of $40B in value 
US growth equity activity
Deal volume picking back up 
US growth equity activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
The last four years of growth equity 
activity reflect the recent paradigm shift of 
investors accommodating larger and more 
mature businesses in the private markets. 
In the first quarter of 2018, growth equity 
accounted for $14.6 billion of deal value 
across 226 deals. This total puts capital 
invested in 1Q 2018 as the third-strongest 
quarter since 2010 and on pace to easily 
best growth equity tallies from the four 
years prior. This represents a more than 
doubling of average deal value from the 
preceding six years given the 2008-2013 
average of $22 billion. Trends in private 
markets tend to evolve over extended 
periods, but the abrupt rise of growth 
equity was driven by the drastic change 
in the VC ecosystem to accommodate 
unicorns and the huge fund flows into 
the asset class to chase high returns. For 
instance, the volume of $50 million+ deals 
made up 60% of total VC deal value during 
1Q 2018, up from 20% in 2009, signaling 
the growing influence of large deals over 
the broader VC market. 
PE growth investors have become more 
willing to participate in large technology 
deals as that industry has matured. The 
main change in technology that drove 
increased enthusiasm from PE investors 
was the proliferation of the SaaS business 
model. The predictable, recurring 
revenue and cashflows generated by SaaS 
businesses provide some stability, plus 
the higher growth prospects fits into a 
more traditional PE investment style. This 
is illustrated by SaaS representing 35% 
of total growth equity deals by count, 
including participation of PE investors 
in the $865 million financing of Katerra, 
a construction ERP and supply chain 
management platform.
$21.2$12.7$19.7$27.1$25.6$25.6$46.1$48.3$44.0$45.7$14.6580 
381 
524 
617 
643 
654 
854 
919 
788 
860 
226 
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Deal Value ($B)
# of Deals Closed
24 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$200M+
$100M-
$200M
$75M-
$100M
$50M-
$75M
$30M-
$50M
$15M-
$30M
21% of GE deals exceed $75M 
US growth equity activity (#) by size
Growth in overall value is clear  
US growth equity activity ($) by size
Sector investment stays steady 
US growth equity medians ($M)
PE growth firms primarily look at tech 
US growth equity activity ($) by sector
Nearly 10% of all growth 
equity financings are of at least 
$200M in size
The median size and valuation 
of growth equity deals have 
steadily grown as demand rises 
for the subclass of investment
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
Note: Growth equity is not included as a subset of overall VC data, but is rather its own 
unique dataset. See the Methodology, page 35, for more details on this particular category. 
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$200M+
$100M-
$200M
$75M-
$100M
$50M-
$75M
$30M-
$50M
$15M-
$30M
$40.0
$45.0
$160.0
$162.5
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Median Deal Size
Median Pre-money Valuation
0
100
200
300
400
500
600
700
800
900
1,000
20082009201020112012201320142015201620172018*Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
25 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
What public market fluctuations signal 
for venture dealmaking
As we know all too well, tech company 
IPOs tend to slow during periods of 
turbulence in the public markets. Naturally, 
few want to test their growth story amid 
public scrutiny when larger unpredictable 
market forces are in play. But what about 
the impact of public market turbulence on 
private venture investments to scaled tech 
companies? 
At SVB, by analyzing both public and 
proprietary data, we see correlations 
around how topsy-turvy public markets 
affect venture deal making. More on that in 
a minute, but first a little scene-setting. 
At the start of 2018, the current bull 
market that started in March 2009 seemed 
determined to celebrate its ninth birthday 
on a heady upswing: The S&P 500 index 
closed up nearly 6 percent in January 
2018, marking one of the best new-year 
debuts in nearly two decades. But February 
arrived with a sobering downturn: In the 
first three trading days, the S&P 500 gave 
up all of its January gains and headed into 
correction territory, bottoming out after a 
10 percent decline from its January high. 
Importantly, during this period of decline, 
the long-dormant CBOE Volatility Index 
(the “VIX”), which measures expectations 
of stock market fluctuations, closed above 
30 for the first time since August 2015 and 
recorded the biggest single-day jump since 
the index was created in 1990. 
At the time of this writing, with the 
exception of a few bumps caused by trade 
war or interest rate fears, the markets 
seem to have recovered from that rocky 
early February of 2018. The IPO window 
appears to be opening again, with the 
strong post-IPO gains of Zscaler and 
Dropbox, and several more VC-backed tech 
companies on deck to go public. Still, the 
volatility index remains above the benign 
sub-15 level it held through 2017, which 
could signal rocky times ahead. What might 
this public market experience mean for 
private late-stage VC investing?
One way to explore this question is to 
compare valuations of public companies 
with a set of late-stage venture financings 
from the same industry to determine any 
differences in valuation characteristics. We 
examined revenue run-rate multiples on 
over 100 late-stage venture financings in 
the enterprise software space (as shown 
by the light blue line on the bottom left 
chart). We then compared them to the BVP 
Cloud Index (as shown by the black line 
on the bottom left chart), which tracks the 
performance of 50 publicly traded cloud 
software companies. 
We found that the revenue run-rate 
multiples of the late-stage private deals 
tracked closely to those in the public 
markets, with valuations of private 
enterprise software deals marginally higher 
than the contemporary median multiple of 
public companies in the BVP Cloud Index. 
The higher multiple is attributed to the fact 
that investors are willing to pay more for 
higher growth rates: The median revenue 
growth rate for the private companies was 
60 percent, compared to 30 percent for 
those in the public cloud index. 
Not only are late-stage private valuations 
influenced by how public markets move, 
but prolonged market corrections can also 
slow down venture deal activity across the 
board. In the 1Q 2016 market correction 
that pushed enterprise software revenue 
multiples down by half, the ensuing 
quarters saw the number of SaaS deals 
and capital invested also fall by half before 
recovering in 2Q 2017. 
In both cases of valuation and volume of 
SaaS company investments made, private 
markets tended to slightly lag behind 
public markets, as it takes time for private 
investors to make sense of greater market 
movements. Still, it seems clear that for 
later-stage private companies, public 
market movements not only affected IPO 
timing, but they also affected venture deal 
velocity and valuation multiples. 
Bob Blee, Head of Corporate Finance, Silicon Valley Bank
0x
1x
2x
3x
4x
5x
6x
7x
8x
9x
10x
2015
2016
2017
Private Transactions
Public Companies
Public multiples a leading 
indicator for venture 
SaaS revenue multiples: Public vs. private
Late-stage SaaS deals slow 
during market turbulence  
US VC deals of $25M+ in SaaS
$2.9$3.9$4.1$3.2$3.0$3.1$2.1$1.5$2.3$4.4$2.4$3.1$4.20
10
20
30
40
50
60
70
80
$0
$1
$2
$3
$4
$5
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2015
2016
2017
2018
Deal Value ($B)
Deal Count
PitchBook-NVCA Venture Monitor 
Sources: SVB Proprietary Data, 
BVP Cloud Index
26 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Exits
$9.1$4.8$7.9$9.9$8.8$9.2$7.8$8.6$6.8$26.3$11.9$10.5$3.9$8.9$11.4$13.1$14.0$11.6$18.2$36.8$8.7$10.5$14.5$15.3$11.1$16.7$15.9$9.3$17.2$13.0$14.3$12.6$8.10
50
100
150
200
250
300
$0
$5
$10
$15
$20
$25
$30
$35
$40
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
2010
2011
2012
2013
2014
2015
2016
2017
2018
Exit Value ($B)
# of Exits Closed
$16.3$16.4$31.7$34.4$55.5$37.3$80.5$49.0$53.0$57.1$8.1483
482
698
738
867
889
1,067
1,004
873
835
188
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Exit Value ($B)
# of Exits Closed
Exits continue to slide, leaving industry in crunch 
US VC-backed exit activity
Exits slide during three of past four quarters 
US VC-backed exit activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
Exit flow in 1Q 2018 came in a bit weaker 
than the same quarter a year ago, with 
$8.1 billion exited across 188 deals, 
representing a 19% decrease YoY in deal 
count. While this is a material drop, it is 
important to remember that exit timing is 
largely idiosyncratic and can be delayed 
for a multitude of reasons. Most recently 
that reason has been larger VC deals, which 
supply a longer cash runway for VC-backed 
companies and can decrease the sense of 
urgency to exit.
To that point, direct secondary sales of 
venture shares have become an increasingly 
popular way to give existing shareholders 
partial liquidity without a full exit event. 
Though this volume is not represented in 
the aggregate exit data, it is becoming a 
substantial source of alternative liquidity. 
The monster $8 billion the SoftBank 
consortium invested in secondary Uber 
shares in addition to the primary round is 
an extreme example, but illustrates how 
such a transaction can provide liquidity for 
early employees and investors. This capital 
returned back to VCs is more important 
now as portfolio company hold periods 
increase, since these secondary sales will 
flow through as distributions back to LPs.
Because of these aforementioned shifts 
in VC toward financing larger companies, 
it’s no surprise that exits over $100 million 
are driving the aggregate exit market on 
both a value and count basis. Additionally, 
due to VC’s reliance on “home-runs,” these 
are also the exits that drive the majority 
of returns back to LPs. While Ring’s $1.2 
billion acquisition by Amazon was the 
28 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
9.7x
9.3x
7.7x
9.1x
9.1x
10.4x
9.8x
10.5x
10.1x
10.4x
9.0x
8,652
1,693
835 
188 
0
2,000
4,000
6,000
8,000
10,000
12,000
0x
2x
4x
6x
8x
10x
12x
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018*
Investments/Exits
# of Investments
# of Exits
$94.0
$70.0
$78.8
$110.0
$0
$20
$40
$60
$80
$100
$120
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Acquisition/Buyout
IPO
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20082009201020112012201320142015201620172018*$500M+
$100M-
$500M
$50M-
$100M
$25M-
$50M
Under
$25M
Exits are getting larger 
US VC-backed exit (#) by size
Median IPO has jumped so far in 2018 
Median US VC-backed exit size ($M) by type
Slow dealmaking has caused ratio to fall 
US VC investment-to-exit ratio
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
largest exit in terms of deal size, the most 
valuable company to exit in the first quarter 
was Dropbox with its $756 million IPO, 
which valued the company slightly under 
their 2014 private valuation of $10 billion. 
We see the positive early performance 
from some of the larger VC-backed IPOs, 
during a more volatile and slightly negative 
broad stock market during the first 
quarter, as a potential bellwether of strong 
demand for these listings throughout the 
remainder of the year. However, sustained 
volatility throughout 2018 would likely 
cause some companies to pull their IPO 
plans or discourage those companies that 
are on the fence. That said, Smartsheet 
and DocuSign have filed for IPOs, which 
points toward more positivity around highly 
valued technology firms pricing on the public 
markets heading into 2Q.
29 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Fundraising
$31.7$12.2$20.0$25.9$24.1$21.3$36.2$36.1$40.9$33.3$7.9192
123
161
156
203
224
295
283
300
235
54
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Capital Raised ($B)
# of Funds Closed
Fundraising likely to pick up after slow quarter 
US VC fundraising activity
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
Billion-dollar funds loom, but small funds 
stick around
So far in 2018, VC funds have closed on 
roughly $8 billion in commitments across 
54 vehicles, putting both capital raised and 
fund count on pace to dip slightly from 
2017. A strong showing from micro funds 
(vehicles smaller than $50 million) has 
pulled down he median fund size, though 
we expect a surge of larger funds to close 
later in the year to provide a boost to fund 
sizes and total capital raised. With two 
billion-dollar funds closed already and up to 
four more in the pipeline, 2018 could still 
surpass last year in terms of total capital 
raised.
In the first quarter of 2018, micro funds 
made up 50% of fund count for the first 
time since 2015. Driven by seed and 
early-stage vehicles with niche strategies 
or regional focuses, the representation 
of smaller funds speaks to continued 
development of innovative strategies and 
$3.1$1.1$1.0$1.9$1.6$1.5$2.0$2.1$2.4$3.5$0.831
25
36
21
28
23
44
30
27
37
11
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Capital Raised ($B)
# of Funds Closed
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
First-time funds continue to be strong 
US first-time fundraising activity
$1.2$0.8$1.1$1.2$1.6$1.8$1.9$1.6$1.7$1.8$0.568 
54 
73 
74 
112 
118 
152 
149 
138 
104 
27 
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Capital Raised ($B)
# Funds Closed
50% of closed funds in 1Q under $50M 
US micro fund activity
30 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2006200720082009201020112012201320142015201620172018*$1B+
$500M-
$1B
$250M-
$500M
$100M-
$250M
$50M-
$100M
Under
$50M
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
PitchBook-NVCA Venture Monitor 
*As of 3/31/2018
emerging venture ecosystems. True Wealth 
Ventures Fund I, for instance, focuses 
exclusively on female founders, while 
Illinois Ventures’ Emerging Technologies 
Fund III seeks to capitalize research 
spin-outs from the University of Illinois. 
First-time funds have also made a strong 
showing with 11 vehicles closed in 1Q 
2018, putting this year on track to each 
2014’s decade high number of funds closed. 
Though capital raised is tracking lower so 
far, the outsized effects of mega-funds 
(vehicles $500 million or greater) will 
likely lift capital raised in the remainder of 
2018, as four vehicles including Lightspeed 
Venture Partners and Social Capital have 
all announced intentions to raise funds of 
$1 billion or more in the near future. The 
impact from mega-funds is clear, as these 
funds made up 47% of all capital raised 
by venture funds in 2018, despite only 
representing 5% of all closed vehicles. 
While three funds of over $1 billion were 
closed in all of 2017, three strategies have 
already closed in the beginning of 2018—
Norwest Venture Partners’ $1.5 billion and 
General Catalyst Partners’ $1.37 billion 
fund, as well as $1.25 billion raised across 
two complementary vehicles from Battery 
Ventures. 
VCs have taken to raising larger funds to 
garner the capital necessary to maintain 
a competitive stance against deep-
pocketed investors, such as SoftBank, as 
deal sizes and valuations continue to rise. 
But strong fundraising is only possible 
if there is sufficient LP demand, and 
many institutional investors have been 
looking to allocate more to private market 
strategies—including VC—while trying 
to consolidate their allocation to fewer 
managers, resulting in larger but fewer fund 
commitments. While these mega-funds 
may offer GPs competitive advantages, 
they also bring into question whether 
their managers can deliver venture-like 
returns, as GPs run the risks of overpaying 
in outsized rounds and overcapitalizing 
startups.
$53.0
$45.0
$146.6 $148.6
$0
$40
$80
$120
$160
$200
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Median
Average
Median fund size declines  
Median & average US VC fund size ($M)
Several large funds planned for rest of year 
US VC fundraising activity (#) by size
See how the PitchBook Platform can 
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32 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
1Q league tables
Y Combinator
15
Innovation Works
12
Elevate Ventures
10
Slow Ventures
8
Social Capital
8
Alumni Ventures Group
7
BAM Ventures
7
BoxGroup
7
Lerer Hippeau Ventures
7
Plug and Play Tech Center
7
Precursor Ventures
7
SV Angel
7
True Ventures
7
First Round Capital
6
Greycroft
6
Keiretsu Forum
6
Liquid 2 Ventures
6
Techstars
6
500 Startups
5
Khosla Ventures
5
M25
5
Revolution
5
Right Side Capital Management
5
Service Provider Capital
5
SOSV
5
TEDCO
5
Most active investors 
angel/seed
Most active investors 
early stage
Most active investors 
late stage
Alumni Ventures Group
18
New Enterprise Associates
18
Plug and Play Tech Center
14
Y Combinator
14
Ben Franklin Technology Partners 13
Andreessen Horowitz
12
Greycroft
11
Sinai Ventures
10
Alexandria Venture Investments
9
GV
9
Lightspeed Venture Partners
9
8VC
8
Khosla Ventures
8
Kleiner Perkins Caufield & Byers
8
Hemisphere Ventures
7
Lerer Hippeau Ventures
7
Lux Capital
7
Menlo Ventures
7
OrbiMed
7
Revolution
7
Shasta Ventures
7
Social Capital
7
AccelFoods
6
BoxGrop
6
Connecticut Innovations
6
Founders Fund
6
GGV Capital
6
Norwest Venture Partners
6
Service Provider Capital
6
Spark Capital
6
True Ventures
6
Upfront Ventures
6
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
GV
14
Khosla Ventures
13
New Enterprise Associates
12
Bessemer Venture Partners
9
Accel
8
Index Ventures
8
Lightspeed Venture Partners
8
Norwest Venture Partners
8
Andreessen Horowitz
7
Battery Ventures
7
Fidelity Management & Research
7
General Catalyst Partners
7
Bain Capital Ventures
6
Canaan Partners
6
Kleiner Perkins Caufield & Byers
6
Founders Fund
5
HealthQuest Capital
5
Redpoint Ventures
5
Thrive Capital
5
Union Square Ventures
5
Versant Venture Management
5
Baillie Gifford
4
Draper Fisher Jurvetson
4
Fifth Wall Ventures
4
Greylock Partners
4
Intel Capital
4
IVP
4
Salesforce Ventures
4
Sequoia Capital
4
Spark Capital
4
Sutter Hill Ventures
4
PitchBook-NVCA Venture Monitor 
33 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Company
Deal size ($M)
Series/stage
Date
HQ
State
Industry
Lyft
 1,700.0
Series H
3/14/2018
San Francisco
California
Software
Faraday Future
 1,500.0
Early Stage VC 
2/14/2018
Los Angeles
California
Other
Uber
 1,250.0
Late Stage VC 
1/18/2018
San Francisco
California
Software
Magic Leap
 963.0
Series D
3/7/2018
Plantation
Florida
Other
Katerra
 865.0
Series D
1/24/2018
Menlo Park
California
Software
DoorDash
 535.0
Series D
3/1/2018
San Francisco
California
Consumer Goods & 
Recreation
Moderna Therapeutics
 500.0
Series G
2/1/2018
Cambridge
Massachusetts
Pharma & Biotech
Wag
 300.0
Series D
1/30/2018
Los Angeles
California
Software
Harmony Biosciences
 295.0
Early Stage VC 
1/18/2018
Plymouth 
Meeting
Pennsylvania
Pharma & Biotech
Viela Bio
 282.3
Series A
3/13/2018
Gaithersburg
Maryland
Pharma & Biotech
Top 10 largest US VC deals in 1Q 2018
Top 10 largest US VC funds closed in 1Q 2018
Top five largest US VC-backed IPOs in 1Q 2018
Largest US VC acquisitions in 1Q 2018
Fund name
Investor
Fund size ($M)
Close date
HQ
State
Norwest Venture Partners XIV
Norwest Venture Partners
$1,500.0
02/14/18
 Palo Alto 
 California 
General Catalyst Group IX
General Catalyst Partners
$1,375.0
03/26/18
 Cambridge 
 Massachusetts 
Battery Ventures XII
Battery Ventures
$800.0
02/06/18
Boston
 Massachusetts 
Battery Ventures XII Side Fund
Battery Ventures
$450.0
02/06/18
Boston
 Massachusetts 
B Capital Fund
B Capital Group
$360.0
02/08/18
Los Angeles
 California 
Danhua Capital II
Danhua Capital
$343.2
02/06/18
Palo Alto
 California 
Elephant Partners II
Elephant Partners
$250.0
03/22/18
New York
 New York 
Workday Ventures Fund
Workday Ventures
$250.0
02/07/18
San Francisco
 California 
Accomplice II
Accomplice VC
$205.0
01/18/18
Cambridge
 Massachusetts 
Aspect Ventures II
Aspect Venture Partners
$181.0
01/23/18
San Francisco
 California 
Company
Exit size ($M)
Exit post-val ($M) Date
HQ
State
Industry
Dropbox
756.0
8,230.0
3/23/2018
San Francisco
California
Software
Vobile
206.4
1,066.0
1/4/2018
Santa Clara
California
Software
Zscaler
192.0
1,877.3
3/16/2018
San Jose
California
Software
Homology Medicines
144.0
577.3
3/28/2018
Bedford
Massachusetts
Pharma & Biotech
ARMO BioSciences
128.0
497.7
1/26/2018
Redwood City
California
Pharma & Biotech
Company
Exit size ($M)
Acquirer(s)
Date
HQ
State
Industry
Ring
1,200.0
Amazon  
(NASDAQ: AMZN)
2/27/2018
Santa Monica
California
Other
ThreatMetrix
811.4
RELX Group (LSE: RELX)
2/22/2018
San Jose
California
Software
LiquidHub
494.4
Capgemini (PAR: CAP)
2/5/2018
Wayne
Pennsylvania
Commercial Services
Cofense
400.0
BlackRock, Pamplona 
Capital Management
2/26/2018
Leesburg
Virginia
Software
Einfochips
283.1
Arrow Electronics  
(NYSE: ARW)
1/9/2018
San Jose
California
Commercial Services
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
34 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
US VC activity by state & 
territory
US VC activity by Metropolitan 
Statistical Area (MSA)
State
District
Deal Count
California
District 12
125
New York
District 12
70
California
District 18
61
California
District 14
44
New York
District 10
41
Washington
District 7
38
Massachusetts
District 7
24
California
District 17
22
California
District 33
20
California
District 52
19
Colorado
District 2
17
Illinois
District 7
17
Massachusetts
District 8
17
California
District 13
15
California
District 28
14
Texas
District 21
14
California
District 49
13
Massachusetts
District 5
13
Colorado
District 1
12
California
District 37
11
Pennsylvania
District 14
11
California
District 45
10
New York
District 7
10
Ohio
District 11
9
California
District 2
8
Georgia
District 11
8
Indiana
District 5
8
Minnesota
District 3
8
North Carolina
District 6
8
Virginia
District 11
8
Virginia
District 8
8
California
District 19
7
Georgia
District 6
7
Maryland
District 8
7
Massachusetts
District 4
7
Pennsylvania
District 2
7
US VC activity by  
Congressional District
State
Deal 
Count
Deal Value 
($M)
California
586
$16,225.3
New York
226
$2,736.4
Massachusetts
131
$2,757.5
Texas
79
$677.5
Illinois
57
$350.0
Colorado
56
$305.1
Washington
55
$621.3
Pennsylvania
44
$555.8
Florida
41
$1,083.4
North Carolina
38
$430.9
Maryland
32
$525.4
Virginia
28
$180.2
Utah
28
$247.0
Ohio
22
$122.8
Minnesota
22
$50.2
Indiana
18
$96.2
New Jersey
17
$357.7
Oregon
17
$64.3
Georgia
16
$45.6
Arizona
14
$40.5
Michigan
14
$79.1
Connecticut
12
$93.7
Tennessee
11
$22.4
Wisconsin
11
$24.6
Kentucky
10
$15.4
Missouri
10
$61.2
Idaho
7
$10.5
South Carolina
7
$69.4
Iowa
7
$24.2
Delaware
7
$27.2
Nevada
7
$12.9
Montana
7
$45.1
New Hampshire
7
$28.0
MSA
Deal Count
San Francisco-Oakland- 
Fremont, CA
303
New York-Northern New Jersey-
Long Island, NY-NJ-PA
226
Boston-Cambridge- 
Quincy, MA-NH
131
Los Angeles-Long Beach- 
Santa Ana, CA
119
San Jose-Sunnyvale- 
Santa Clara, CA
100
Chicago-Naperville- 
Joliet, IL-IN-WI
52
Seattle-Tacoma-Bellevue, WA
49
Austin-Round Rock, TX
41
San Diego-Carlsbad- 
San Marcos, CA
37
Washington-Arlington-
Alexandria, DC-VA-MD-WV
37
Philadelphia-Camden-
Wilmington, PA-NJ-DE-MD
30
Denver-Aurora, CO
26
Miami-Fort Lauderdale-
Pompano Beach, FL
25
State
Deal 
Count
Deal Value 
($M)
District of Columbia
6
$17.8
Alabama
6
$13.2
Kansas
5
$110.6
Arkansas
5
$5.3
Maine
4
$7.6
Oklahoma
4
$44.4
Louisiana
3
$9.6
New Mexico
3
$13.3
Mississippi
3
$7.2
Hawaii
2
$9.6
Vermont
2
$2.6
Rhode Island
2
$10.2
Nebraska
1
$0.8
Alaska
1
$0.2
West Virginia
1
$4.6
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
Methodology
Fundraising 
We define VC funds as pools of capital raised for the purpose of investing in the equity of startup companies. In addition to funds raised 
by traditional VC firms, PitchBook also includes funds raised by any institution with the primary intent stated above. Funds identifying as 
growth-stage vehicles are classified as PE funds and are not included in this report. A fund’s location is determined by the country in which 
the fund is domiciled; if that information is not explicitly known, the HQ country of the fund’s general partner is used. Only funds based 
in the United States that have held their final close are included in the fundraising numbers. The entirety of a fund’s committed capital is 
attributed to the year of the final close of the fund. Interim close amounts are not recorded in the year of the interim close. 
Deals 
We include equity investments into startup companies from an outside source. Investment does not necessarily have to be taken from an 
institutional investor. This can include investment from individual angel investors, angel groups, seed funds, VC firms, corporate venture 
firms, and corporate investors. Investments received as part of an accelerator program are not included, however, if the accelerator 
continues to invest in follow-on rounds, those further financings are included. All financings are of companies headquartered in the US. 
Angel & seed: We define financings as angel rounds if there are no PE or VC firms involved in the company to date and we cannot determine 
if any PE or VC firms are participating. In addition, if there is a press release that states the round is an angel round, it is classified as such. 
Finally, if a news story or press release only mentions individuals making investments in a financing, it is also classified as angel. As for 
seed, when the investors and/or press release state that a round is a seed financing, or it is for less than $500,000 and is the first round as 
reported by a government filing, it is classified as such. If angels are the only investors, then a round is only marked as seed if it is explicitly 
stated. 
Early-stage: Rounds are generally classified as Series A or B (which we typically aggregate together as early stage) either by the series of 
stock issued in the financing or, if that information is unavailable, by a series of factors including: the age of the company, prior financing 
history, company status, participating investors, and more. 
Late-stage: Rounds are generally classified as Series C or D or later (which we typically aggregate together as late stage) either by the series 
of stock issued in the financing or, if that information is unavailable, by a series of factors including: the age of the company, prior financing 
history, company status, participating investors, and more. 
Growth equity: Rounds must include at least one investor tagged as growth/expansion, while deal size must either be $15 million or more 
(although rounds of undisclosed size that meet all other criteria are included). In addition, the deal must be classified as growth/expansion or 
later-stage VC in the PitchBook Platform. If the financing is tagged as late-stage VC it is included regardless of industry. Also, if a company is 
tagged with any PitchBook vertical, excepting manufacturing and infrastructure, it is kept. Otherwise, the following industries are excluded 
from growth equity financing calculations: buildings and property, thrifts and mortgage finance, real estate investment trusts, and oil & gas 
equipment, utilities, exploration, production and refining. Lastly, the company in question must not have had an M&A event, buyout, or IPO 
completed prior to the round in question. 
Corporate VC: Financings classified as corporate VC include rounds that saw both firms investing via established CVC arms or corporations 
making equity investments off balance sheets or whatever other non-CVC method actually employed. Rounds in VC-backed companies 
previously tagged as just corporate investments have been added into the dataset.  
Capital efficiency score: Our capital efficiency score was calculated using companies that had completed an exit (IPO, M&A or PE Buyout) 
since 2006. The aggregate value of those exits, defined as the pre-money valuation of the exit, was then divided by the aggregate amount 
of VC that was invested into those companies during their time under VC backing to give a Multiple On Invested Capital (MOIC). After the 
average time to exit was calculated for each pool of companies, it was used to divide the MOIC figure and give us a capital efficiency score. 
Exits 
We include the first majority liquidity event for holders of equity securities of venture-backed companies. This includes events where there 
is a public market for the shares (IPO) or the acquisition of majority of the equity by another entity (corporate or financial acquisition). This 
does not include secondary sales, further sales after the initial liquidity event, or bankruptcies. M&A value is based on reported or disclosed 
figures, with no estimation used to assess the value of transactions for which the actual deal size is unknown.
COPYRIGHT © 2018 by PitchBook Data, Inc. All rights reserved. No part of this publication may be reproduced in any form or by any means—graphic, electronic, or 
mechanical, including photocopying, recording, taping, and information storage and retrieval systems—without the express written permission of PitchBook Data, Inc. Contents 
are based on information from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. Nothing herein should be construed as any past, current 
or future recommendation to buy or sell any security or an offer to sell, or a solicitation of an offer to buy any security. This material does not purport to contain all of the 
information that a prospective investor may wish to consider and is not to be relied upon as such or used in substitution for the exercise of independent judgment.
35 
1Q 2018 PITCHBOOK-NVCA VENTURE MONITOR
Why we teamed up
Meet the PitchBook-NVCA Venture Monitor
NVCA is recognized as the go-to organization for  
venture capital advocacy, and the statistics we 
release are the industry standard. PitchBook is 
the leading data software provider for venture 
capital professionals, serving more than 1,800  
clients across the private market. Our partnership  
with PitchBook empowers us to unlock more 
insights on the venture ecosystem and better 
advocate for an ever-evolving industry.
A brand-new, quarterly report that 
details venture capital activity  
and delivers insights to inform your 
investment strategy. PitchBook’s  
data will also bolster our  
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We will email quarterly surveys to each 
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opportunity to report your activity to 
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not only power PitchBook-NVCA reports, 
but also ensure your firm is represented 
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limited partners who will likely be interested 
in your fund.
Conduct better due diligence by diving deep 
into a company’s round-by-round financing 
history, executive team and market traction. 
Price deals with confidence using pre- and 
post-money valuations, public and private 
comps, cap tables and series terms.
Find promising investors quickly by zeroing 
in on other firms or strategic acquirers 
whose investment preferences match your 
portfolio company.
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