Pitchbook Venture Monitor Report 2017 Q4

The fourth quarter of 2017 bookended the year as the third consecutive quarter with more than $20 billion deployed into US venturebacked companies, and marked the close of a strong year of investment that surpassed $80 billion annually for the first time since the dot-com era. Investors deployed $23.75 billion into 1,772 companies in 4Q, the fewest since 4Q 2011, bringing the annual total to 7,783 and marking the lowest level since 2012.
About Techcelerate Ventures

Tech Investment and Growth Advisory for Series A in the UK, operating in £150k to £5m investment market, working with #SaaS #FinTech #HealthTech #MarketPlaces and #PropTech companies.
NVCA venture MONITOR PitchBook NVCA venture venture 1Q 2Q 3Q 2Q 3Q 4Q 4Q 1Q 2Q
About Techcelerate Ventures

Tech Investment and Growth Advisory for Series A in the UK, operating in £150k to £5m investment market, working with #SaaS #FinTech #HealthTech #MarketPlaces and #PropTech companies.
NVCA venture MONITOR PitchBook NVCA venture venture 1Q 2Q 3Q 2Q 3Q 4Q 4Q 1Q 2Q
4 Q 2017
2017 sees more than $84B in 
VC invested, the highest tally 
since the dot-com era
 Pages 4-5
The definitive review of the US venture capital ecosystem covering 4Q and full-year 2017
Sector analysis, with 
spotlights by Silicon Valley 
Bank on biotech & fintech 
Pages 15-17
League tables for 4Q deals, 
investors, exits and more 
Pages 32-34
In partnership with
Credits & Contact
PitchBook Data, Inc. 
JOHN GABBERT Founder, CEO 
ADLEY BOWDEN Vice President, 
Research & Analysis
Content
NIZAR TARHUNI Analysis Manager 
KYLE STANFORD Analyst 
BRYAN HANSON Data Analyst II 
JENNIFER SAM Senior Graphic Designer 
RESEARCH 
reports@pitchbook.com
National Venture Capital Association 
(NVCA)
BOBBY FRANKLIN President & CEO
MARYAM HAQUE Vice President of Research & 
Strategic Engagement
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 
DENNY BOYLE Managing Director, Fintech
JONATHAN NORRIS Managing Director, Life 
Science & Healthcare
DEREK RIDGLEY Credit Research & Development 
Officer
 
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
LOWELL NESS Partner, Blockchain Technology & 
Digital Currency 
 
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 
 
Contact Solium 
solium.com
Executive summary
3
Overview
4-5
Perkins Coie: Cryptos, standardization & structured 
release valves
7-8
Angel/seed
9
First financings
10
Early-stage VC
11
Late-stage VC
12
Activity by region
13
Activity by sector
14
SVB: When tech meets biotech
15
SVB: US fintech investment grows in 2017: What’s 
next?
17
Corporate VC
18-19
Growth equity
21-22
Q&A: SVB President Michael Descheneaux
23
SVB: Credit Insights: Debt vs. equity
24
SVB: Startup Financial Insights
25
Exits
26-27
Fundraising
28-30
League Tables
32-34
Methodology
35
Contents
2 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Executive Summary
3 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
The fourth quarter of 2017 bookended the year as the third consecutive quarter with more than $20 billion deployed into US venture-
backed companies, and marked the close of a strong year of investment that surpassed $80 billion annually for the first time since the 
dot-com era. Investors deployed $23.75 billion into 1,772 companies in 4Q, the fewest since 4Q 2011, bringing the annual total to 7,783 
and marking the lowest level since 2012. 
In unpacking the data and speaking with venture investors, the impact of the continued evolution of market dynamics were evident in 
2017. After investors raised a total of $110 billion via venture funds from 2014 to 2016—and an additional $32.4 billion last year—capital 
ready for deployment into startups has been more than ample. Beyond traditional capital from venture capital funds, SoftBank’s headline-
grabbing $100 billion Vision Fund has had an ever-increasing role in the ecosystem with no signs of abating. SoftBank was present in 
several of the highest-profile deals of the year, including WeWork’s $3 billion US investment and Compass’ $450 million rounds last 
quarter. Not to mention it is set to become the largest investor in Uber this year. 
While such a large pool of capital is available to the industry, investors are working to stay disciplined in their approach, translating into 
overall fewer deals taking place, though more capital being deployed at higher valuations. As a result, median deal sizes have increased 
across all stages in recent years, doubling at the angel, seed and early stages since 2013, while the median late-stage deal has grown 
about 67% over that period. At the same time, the age of companies receiving funding at each series has also seen a noticeable increase 
over the past five years. This is likely a cause and result of investors looking for stronger KPIs when investing such large checks. That is, 
the stronger the company, the worthier of that oversized deal they seemingly are. Coinciding with these market shifts, investment into 
unicorns (i.e., those valued at $1 billion+) occurred at a frenetic pace, reaching a record high in 2017. These companies attracted $19.1 
billion last year, which represented 23% of the total capital invested across the industry. 
An important trend that flew more under the radar in 2017 was the rise in life science investment, which reached a 10-year high with 
$17.6 billion deployed to 1,046 companies working on groundbreaking innovations in healthcare. Part of the rise can be attributed to 
the renewed focus on biotech opportunities. Once seen as a niche investment strategy, biotech has moved in the direction of software, 
becoming somewhat mainstream in the venture world. In fact, cancer screening company Grail recorded the second-largest deal of 
the fourth quarter, raising $1.2 billion, and bioengineering startup Ginkgo Bioworks raised $275 million in 4Q and joined Grail to reach 
unicorn status. This trend is further supported by recent fundraising activity led by the arrival of new firms such as Pivotal bioVenture 
Partners, which raised a $300 million fund in 2017, as well as established firms such as Andreessen Horowitz, which recently closed its 
$450 million second biotech fund.
Public policy developments have also had a positive impact on the biotech sector. Investors have welcomed the recent appointment of 
physician and former venture investor Scott Gottlieb as Commissioner of the Food and Drug Administration (FDA) and support his efforts 
to reform the FDA to better advance healthcare innovations. 
A change in leadership at the FDA hasn’t been the only example of public policy impacting the venture ecosystem. Many aspects of the 
recently-passed tax reform plan will touch entrepreneurs, startups and venture investors. Lowering the corporate tax rate to 21% as well 
as the repatriation provisions to allow corporations to bring back profits from overseas may signal increased M&A activity in the year 
ahead after activity stalled in 2017 with the fewest recorded (565) since 2009. The changes in tax reform bring good news for startups 
looking to take the next step in their growth, and VC investors seeking liquidity. 
While the overall US economy posted a strong 2017, optimism for a strengthening venture-backed IPO environment in 2017 yielded an 
uptick from 41 IPOs in 2016 to 58 in 2017, but the resurgent comeback many were looking for never fully materialized. With companies 
staying private longer and valuations peaking in the private market, the challenge remains for public market investors to gain early access 
to the new wave of high-growth companies in order to reap the full benefits. Capital market reform remains a focus for the venture 
industry, and some are perhaps more cautiously optimistic for an uptick in IPO activity in 2018. Many will be closely tracking Spotify’s 
efforts to directly list on the NYSE in hopes it could lead others to pursue the same track.
4 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$36.9$26.6$31.6$44.0$41.2$45.3$69.5$79.3$72.4$84.24,684 4,434
5,351
6,703
7,849
9,183
10,406 10,463
8,635
8,076
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
0
500
1,000
1,500
2,000
2,500
3,000
$0
$5
$10
$15
$20
$25
2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q 2Q 4Q
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
Angel/Seed
Early VC
Late VC
Overview
Midway through last year, we highlighted 
that 2017 was pacing to come in as the 
highest year since at least the dot-com 
era in terms of total capital invested. As 
we closed out 2017, this certainly played 
out, with more than $84 billion in capital 
invested across nearly 8,100 completed 
financings, reflecting a drop of around 6% 
in terms of aggregate deals, yet a surge in 
total deal value of 16% year over year (YoY).
The venture markets today have undergone 
a shift in the dynamics and parameters 
that have shaped them. Companies are 
larger and many are taking on institutional 
financings later in their lifecycle as 
evident by the growing median age of 
companies raising venture rounds. This 
trend is particularly notable the earlier 
in the investment cycle you look. Since 
2013, the median age of companies raising 
institutional angel & seed rounds has 
grown a staggering 38% to 2.42 years, with 
companies at the Series A round coming in 
at just over 3.5 years of age, and Series B 
companies typically raising those rounds at 
around year five, on a median basis. 
We’ve also continued to witness liquidity 
cycles stretch to unprecedented levels, 
driven by record amounts of dry powder 
ready to be deployed to the outperforming 
businesses that have proven their going 
concerns in today’s marketplace. This 
notion is compounded by a founder and 
management mentality that has embraced 
the continued use of private capital to fuel 
growth, rather than move through an IPO 
or M&A exit. Just as recently as a few years 
ago, this wasn’t simply a matter of choice, 
but also an implicit need to garner the 
typically large amount of capital needed to 
drive growth at a later-stage company. That 
is not the case today.
To illustrate, venture financings of at least 
$50 million have grown at a compounded 
annual growth rate of some 13% since 
$84B+ invested for first time since dot-com era 
US VC activity
2017 a record year in deal value 
US VC activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
5 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
Near 50% of value from deals of $50M+ 
US VC activity ($) by size
$6.3$2.4$2.7$13.9$16.3$17.4$19.27
7
9
27
25
24
69
75
49
73
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
Nearly record unicorn activity 
US unicorn activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
2007, more than double the pace at which 
rounds completed between $25 million and 
$50 million (6% CAGR) have grown, and at 
nearly 4x the rate at which rounds between 
$5 million and $25 million have increased 
(2.5%-3% CAGR). Further, VC financings of 
$50 million+ accounted for nearly half of all 
VC invested in 2017, a staggering figure in 
and of itself that is even more remarkable 
when compared to the fact that such 
rounds represented less than 20% of all VC 
invested in 2007. 
Round sizes have also continued to increase 
and have shown no sign of slowing down, 
growing at a rapid pace across the entire 
venture lifecycle. At $6 million, early-stage 
rounds came in roughly 20% higher than 
what we saw in 2016, with late-stage 
rounds growing 14% to $11.4 million. This, 
coupled with the rounds completed by 
aging companies that continue to push 
off full liquidity events, has resulted 
in a profound rise in private company 
valuations, particularly at the late stage 
where we saw median Series D+ valuations 
jump to $250 million last year, a hike of 
over 85% relative to the already large $135 
million figure we saw in 2016. 
In many ways, 2017 can be characterized 
by the record amount of activity we saw 
involving unicorns. More than $19 billion 
was invested into such companies across 
73 completed fundings, reflecting a YoY 
increase of over 10% and nearly 49%, 
respectively. Further, investments in 
companies valued over $1 billion amounted 
to more than a fifth of all VC invested last 
year, yet less than 1% of total deal flow. 
We’ve also begun to see winners and losers 
emerge amongst some of the various 
tech platforms we saw rise over the last 
half decade or so in areas such as fintech, 
Big Data, virtual reality and the sharing 
economy, among others. For example, 
companies such as Airbnb, Lyft, WeWork, 
Magic Leap, Unity, SoFi, Wish and 
Coinbase have all built relatively successful 
businesses over the last few years, able 
to continue raising private capital at 
hefty valuations and contributing to the 
continued rise of unicorn financings. 
Early-stage rounds grow in size by roughly 20% 
Median deals size ($M) by stage
$0.9
$1.0
$5.0
$6.0
$10.0
$11.4
$0
$2
$4
$6
$8
$10
$12
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Angel/Seed
Early VC
Late VC
PitchBook-NVCA Venture Monitor
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7 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Cryptos, standardization & structured 
release valves
Silicon Valley 
continues to 
impress us with 
its ability to reinvent itself despite a 
host of changing market dynamics. On 
a sector basis, we’ve seen a transition 
away from hardware businesses and a 
slowdown across the 3D printing and 
digital health technology markets. Yet just 
as these platforms, among others, have 
moved through their respective growth 
cycles, many others have blossomed 
today. This year’s flavor revolves around 
the cryptocurrency markets, with AI and 
robotics businesses also receiving ample 
attention. 
With the backdrop of more than $4.2 billion 
raised via ICOs in 2017, we’ve continued 
to see requests from prospective clients 
to conduct new ICOs, or from businesses 
looking to create new infrastructure 
tools such as various digital or hardware 
wallets. With this increased popularity, 
however, comes increased complexity from 
a legal perspective. Despite our active 
participation in the market, we’ve remained 
conservative with our approach to serving 
the industry, following an evaluation 
framework that spans three primary steps. 
1: Token Utility
First, we look for tangible underlying 
utility in the tokens of the businesses we 
represent. 
2: Management review
Second, we conduct extensive background 
checks on the management teams we work 
with. While we understand the prospective 
value that can be derived in the market, 
we also see the structure of the market at 
times incentivizing bad actors. Thus, we 
find it even more prudent that we vet the 
teams we work with.
3: Setting expectations
Last, we look to set realistic expectations 
with entrepreneurs. While on the surface, 
an ICO may appear a much easier and 
quicker capital-raising process, the reality 
is in many situations it isn’t. Properly 
conducted ICOs can take anywhere from 
three to five months to move through 
regulatory, tax and disclosure work, with 
legal fees that can still reach the same 
levels seen with small IPOs. To that point, 
we look to ensure that the businesses we 
work with not only provide tangible value, 
but also are well prepared for the process 
ahead of them. 
Despite many traditional venture funds 
moving down market as round sizes have 
grown, many of the new companies across 
the aforementioned sectors are availing 
themselves of seed and early-stage funding 
via the swathes of angel and sub-$100 
million-$150 million vehicles that have 
grown in popularity over recent years. This 
produces a challenge in terms of fund 
formation that we’ve worked to help 
both new managers and smaller vehicles 
sidestep. 
Typically, such vehicles are only working 
with a handful of LPs and as a result, we’ve 
looked to adjust the way we structure such 
funds and genericize the terms of these 
vehicles to make the process much more 
cost-effective. For funds raising anywhere 
from $25 million to $50 million in capital, 
racking up legal fees in the hundreds 
of thousands of dollars can be seen as 
impractical and oppressive to not only the 
GPs but the LPs and thus, adding a more 
structured approach in this market has 
been pivotal. 
In addition, as round sizes have grown 
significantly as of late, many of these 
smaller vehicles lack the capital under 
management to participate in some of 
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the follow-on rounds of their portfolio 
companies. However, in an effort to take 
advantage of their preemptive rights to 
participate in future financings, we’ve seen 
an increasing trend of GPs structuring 
one-time investment funds in the form 
of special purpose vehicles. These SPVs 
are structured as separate capital pools 
set up between the venture partners and 
their LPs to take advantage of follow-on 
investment opportunities. As many of these 
opportunities revolve around companies 
that both the GPs and LPs typically already 
know well, the hard work of sourcing, 
placing and monitoring investments has 
already been done, effectively offering 
fund managers a boost in leverage that can 
be very lucrative. 
Lastly, the lack of liquidity driven by a 
dearth of VC-backed exits has been a 
heightened issue as of late. As companies 
demonstrate go-to-market, customer 
adoption and market expansion success, 
raising capital privately has persisted. Yet 
through this, companies face significant 
challenges in providing liquidity to their 
employees as the bulk of the incentives 
placed in front of them come in the 
form of equity. As a result, the use of 
secondary sales for investors, management 
and employees has grown. At times, 
such transactions can be sporadic and 
opportunistic, but given their expensive 
nature and complexity, we’ve seen a 
number of companies look to structure 
formal, periodic secondary opportunities. 
These sales don’t completely solve the 
industry’s liquidity issues, as they are 
constrained by limits on the amount of 
vested equity that can be sold, and tend 
to have difficulty in realizing an optimal 
price for both employees and investors, 
given discrepancies between common and 
preferred stock owned by different groups. 
Yet at the moment, they do provide a stop-
gap measure to help alleviate some of the 
liquidity challenges aging private companies 
are facing. 
Cryptos, standardization & structured 
release valves, cont.
Following a 2016 that saw both capital 
invested and completed financings at 
the angel & seed stage drop around 20%, 
the market stabilized to some extent last 
year. In lock-step with financing trends 
across the entire venture market, deal 
flow in the bucket declined some 13% YoY, 
with aggregate capital invested growing 
moderately. As many businesses continue 
to bootstrap operations or rely on pre-
seed funding sources, today’s angel & 
seed investments have become more 
institutionalized. As a result, deal sizes have 
grown, with the median size rising to $1 
million last year, up 100% over the last five 
years. In addition, we’ve seen a significant 
amount of capital raised by micro VC funds 
targeting the space. Between 2011 and 
2015, the count of micro VC funds doubled, 
and today sit on roughly $5 billion in dry 
powder yet to be deployed. 
What we continue to note, however, is 
the lower counts in completed financings. 
Today, more institutional investors are in 
the market looking to back early-stage 
startups. The number of companies 
competing for this capital has also grown 
considerably over the last few years. As 
a result, the bar has risen in terms of the 
KPIs that investors will want to see before 
investing. This notion, along with the 
delayed entrance of companies into the 
traditional seed & angel space will continue 
to contain deal flow in the size bucket. 
9 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$429$405$391$1,269$655$631$526$733$823$1,113$1,241$866$1,274$1,084$1,326$1,577$1,278$1,371$2,026$1,854$2,053$2,171$2,078$1,946$1,653$1,749$1,701$1,518$1,579$1,672$1,830$1,7010
200
400
600
800
1,000
1,200
1,400
1,600
$0
$500
$1,000
$1,500
$2,000
$2,500
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($M)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$5M+
$1M-
$5M
$500K-
$1M
Under
$500K
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017Seed
Angel
Smaller deals shrinking in number 
US angel & seed deals (#) by size
Angel deals account for larger amount 
US angel vs seed deals (#)
Decline in angel & seed activity has slowed over the past year 
US angel & seed activity
Angel & seed 
activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
10 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$1.4$1.0$1.1$1.2$1.9$1.4$1.5$1.5$1.6$2.1$2.0$1.6$1.8$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$2.1$1.7$1.7$2.2$1.7$2.30
200
400
600
800
1,000
1,200
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
$3.0
1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
First financings
30.6%
29.3%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
First financings continue decline 
Percentage of first-financing VC rounds
The number of startups receiving their first round has leveled off 
US first-financing activity
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Angel/Seed
Early VC
Late VC
Angel/seed deals have fallen furthest 
US first-financing VC rounds (#) by stage
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
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The early stage saw a dramatic increase 
in capital investment during the fourth 
quarter, seeing more than $10 billion 
invested in a single quarter for the first 
time. Not only is that a 40% increase over 
the total invested during 3Q, but it is nearly 
double the amount invested during the 
same period in 2014, which at the time 
was the highest we’ve seen of any quarter 
in the last decade. The 582 transactions 
completed during 4Q comes in as the 
second lowest quarterly total of the past 
five years, however, as we continue to 
collect data we may see that number inch 
slightly higher. 
While increasing deal sizes have become 
a common fixture, such deals at the early 
stage illustrate how excessive dry powder 
in the industry is not solely reserved for 
late-stage plays, but even mid-sized and 
early ones. The market will continue to 
cycle through various trends, and while 
investors might be looking to be more 
selective before investing in what they see 
as the next quality blockchain, robotics 
or AI business, they’ll continue to make 
larger initial, and follow on bets across the 
industry. 
11 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Early-stage VC
$3.0$2.5$2.7$2.5$3.3$2.9$3.5$3.8$3.0$3.6$3.1$3.0$3.2$3.7$3.2$4.4$4.6$5.1$4.8$5.5$4.9$7.0$6.1$5.9$5.9$6.4$5.7$5.0$5.8$7.3$7.3$10.20
100
200
300
400
500
600
700
800
900
$0
$2
$4
$6
$8
$10
$12
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$25M+
$10M-
$25M
$5M-
$10M
$1M-
$5M
$500K-
$1M
Under
$500K
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$25M+
$10M-
$25M
$5M-
$10M
$1M-
$5M
$500K-
$1M
Under
$500K
Large deals bolstering early-stage tallies 
US early-stage activity (#) by size
Deals <$10M fall to decade low 
US early-stage activity ($) by size
Early-stage VC has shown relatively consistent growth in deal value 
US early-stage VC activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
$4.2$5.8$4.0$4.5$9.5$6.6$6.9$5.0$5.9$6.6$6.2$5.7$6.1$5.9$7.0$6.6$9.0$13.1$9.0$11.9$12.9$11.1$13.3$9.8$11.3$15.4$8.2$7.8$9.6$13.3$12.1$11.80
100
200
300
400
500
600
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
We continue to see late-stage venture 
activity exhibit considerable influence over 
the private financial markets, as well as 
across the broader capital markets. Despite 
a significant portion of non-traditional 
investors exiting the market as of late, 
newcomers such as sovereign wealth funds, 
and, most dramatically, SoftBank’s $100 
billion Vision Fund have only added fuel 
to a maturing late-stage space recently 
defined by mega-deals. Over $47 billion 
was poured into late-stage VC rounds in 
2017 across more than 1,600 transactions, 
reflecting a roughly 10% YoY jump in deal 
value through nearly equal number of 
deals. Further, deals over $50 million in size 
contributed nearly 70% of all late-stage 
capital invested last year—that figure stood 
at just over 30% in 2012. 
Venture-backed exits have remained 
subdued, particularly across some of the 
primary avenues historically used. Dry 
powder levels have never been higher, 
leading to massive financings being readily 
available. Despite the obvious impact 
on exits and LP liquidity in this market 
dynamic, many of the non-traditional 
investors such as SoftBank have been 
able to acquire a notable portion of their 
late-stage transactions via the secondary 
market. Should this continue, we could very 
well see the late-stage market remain little 
changed over the next year or so as earlier-
stage investors would begin to receive 
an increased portion of the liquidity the 
current market dynamic has taken away. 
12 
4Q 2017 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
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
$50M+ deals account for 65% of capital 
US late-stage activity ($) by stage
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
13 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
West Coast
40.3% of 4Q Deals
55.4% of 4Q Deal Value
Mountain
7.8% of 4Q Deals
3.4% of 4Q Deal Value
Midwest
1.6% of 4Q Deals
0.4% of 3Q Deal Value
Great Lakes
7.4%of 4Q Deals
3.1% of 4Q Deal Value
Mid-Atlantic
20.4% of 4Q Deals
19.2% of 4Q Deal Value
New England
8.7% of 4Q Deals
12.1% of 4Q Deal Value
Southeast
6.7% of 4Q Deals
4.5% of 4Q Deal Value
South
7.1% of 4Q Deals
2.0% of 4Q Deal Value
Mid-Atlantic holds steady in 2nd 
US VC deal activity (#) by region
Despite opportunities outside traditional VC hubs, few trends have changed 
4Q 2017 US VC deal activity by region
Activity by region
PitchBook-NVCA Venture Monitor 
West Coast deal value rebounds in 4Q 
US VC activity ($) by region
PitchBook-NVCA Venture Monitor 
PitchBook-NVCA Venture Monitor 
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q2014
2015
2016
2017
Great Lakes
Mid-Atlantic
Midwest
Mountain
New
England
South
Southeast
West Coast
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q2014
2015
2016
2017
Great Lakes
Mid-Atlantic
Midwest
Mountain
New
England
South
Southeast
West Coast
14 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Activity by sector
0
2,000
4,000
6,000
8,000
10,000
12,000
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Traditional sector lines are blurring 
US VC activity (#) by sector
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Pharma & biotech has a big year 
US VC activity ($) by sector
38.8%
37.8%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Software Deal Count
Software as % of Total US VC (#)
Software slowly sliding 
US VC activity (#) in software
47.2%
36.5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
$0
$5
$10
$15
$20
$25
$30
$35
$40
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Software Deal Value ($B)
Software as % of Total US VC ($)
After 2016 peak, software declines 
US VC activity ($B) in software
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
If there is an overall theme 
for the breakout year of life 
sciences/healthcare investments, it is this: 
Technology is driving the future. 
In 2017, investment into venture-backed 
companies hit the stratosphere, punctuated 
by several very large, $100 million-plus bets 
in biopharma and diagnostics/tools (Dx/
Tools) companies. All told, $17.9 billion was 
invested in life science companies last year, 
a 21% increase over the previous record 
of 2015 and 48% over 2016. In contrast, 
overall venture funding only grew 16% over 
2016.
Traditional healthcare investors and 
generalist investors, many of the latter new 
to the life sciences industry, are quickly 
staking out positions in the emerging 
ecosystem that is combining technology 
advancements in artificial intelligence 
(AI) with genomic data to develop 
groundbreaking diagnostic and treatment 
options. These investors see healthcare as 
the next great frontier, one with enormous 
challenges but also full of potential 
for big payoffs. Specifically, biopharma 
investments are focused on therapeutic 
developments, notably oncology and 
orphan/rare indications. The diagnostics 
and tools sector is seeing huge investments 
in next-generation DNA sequencing (NGS) 
technology and liquid biopsy companies 
that enable earlier and more accurate 
cancer detection.
New investors propel life science investing 
to new heights 
What happened in 2017? Traditional VC 
investors, joined by corporate venture arms 
and crossover investors, provided a very 
large pool of capital for biopharma and Dx/
Tools companies. Some interesting trends 
to watch: Generalist investors quickly are 
becoming the most active players in Dx/
Tools. Traditional venture investors have 
returned to devices, joined by PE firms 
and family offices that often lead deals in 
commercialization rounds.
Biopharma leads the way
In 2017, biopharma saw a wave of IPOs, 
while M&A activity slowed. The open IPO 
window, in combination with record high 
pre-money IPO valuations, helped drive 
activity. Many biopharma IPOs earlier 
in the 2013-2017 cycle involved early-
stage companies (pre-clinical and Phase I). 
However, in 2017 we saw a dramatic shift 
from early-stage to Phase II and Phase III 
companies going public. 
Biopharma investors see tremendous 
returns
That said, half of biopharma big exit M&A 
deals focused on early-stage (pre-clinical 
and Phase I) companies. Biopharma 
companies continue to buy early-stage 
companies in order to replenish their 
pipelines. This drove down the time to 
exit from the close of Series A financing 
for biopharmas, with the median time to 
exit at a record 3.5 years. These deals had 
very healthy upfront multiples, providing 
tremendous returns for investors.
Dx/Tools investors bet heavily, but exits 
are scarce
Investments and exits have diverged for 
Dx/Tools. Despite heavy investment in 
the sector, exits proved elusive. The R&D 
tools subsector has largely dominated 
the few acquisitions that have occurred 
in the past five years. Historically, the 
majority of Dx/Tools exits has been based 
on commercial revenue multiples rather 
than the enterprise values typically seen 
in biopharma M&A. Based on the current 
uptick in venture investment and soaring 
valuations, robust exit multiples will be 
difficult to achieve with the current acquirer 
pool. 
However, we believe that large Dx/Tools 
companies will adopt M&A strategies 
similar to biopharma: These companies 
will fuel their primary R&D activities by 
acquiring early-stage, venture-backed 
Dx/Tools companies. At the same time, 
tech giants like Amazon, Apple, Alphabet 
and Microsoft are targeting Dx/Tools 
companies as an entry point into life 
science investing; we expect their activity 
to grow and lead to big exits. 
Large companies drive device M&A
IPOs and M&A activity remained stable for 
device companies in 2017. M&A deals were 
driven by large companies (J&J, Boston 
Scientific, for example), although longtime 
acquirer Medtronic continued to be absent. 
The acquisitions focused on companies that 
are developing minimally invasive solutions 
and advanced imaging/visualization 
platforms. Interestingly, companies that 
require clinical trials (PMA/De Novo 510(k)) 
are being acquired early, while iterative 
510(k) companies must prove themselves in 
the market first. Since 2015, PMA and De 
Novo 510(k) acquisitions generated larger 
upfront multiples and swifter exits than 
iterative 510(k) exits, and these acquisitions 
are now approaching the upfront deal 
values and multiples that we see in 
biopharma. We anticipate healthcare-
focused investors to place bigger bets in 
innovative early-stage device companies.
$8.5$9.2$11.9$14.6$11.9$17.61,076
1,140
1,201
1,228
1,051
1,093
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
15 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
When tech meets 
biotech
  
US VC activity in life sciences
PitchBook-NVCA Venture Monitor
Emily Leproust, Co-founder and CEO, Twist Bioscience
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SILICON VALLEY BANK, MAKE NEXT HAPPEN NOW and the chevron device are trademarks of SVB Financial Group, used under license.
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Fintech established itself as a 
key standout category in 2017, 
posting the strongest year for investment 
since the 2015 peak. Aggregate fintech 
investments reached approximately 
$6.5 billion in 2017. Major contributing 
categories have been alternative lending, 
payments, wealth management, and 
more recently blockchain/cryptocurrency, 
insurtech and real estate tech. 
The numbers are only part of what’s 
interesting about the fintech story, with 
unique challenges relative to disruptors of 
other major industries. Specifically, scaling 
has been difficult for fintech companies 
dealing with compliance and regulatory 
issues, access to capital hurdles and intense 
competition from startups and incumbents. 
Despite these challenges, we believe the 
investment pace will continue due to two 
core reasons: increasing customer demand 
and enabling platform technologies that 
provide key infrastructure for young fintech 
companies to launch and grow. These 
fintech infrastructure companies, analogous 
to how Amazon Web Services and open 
source supported software companies, 
are lowering the barriers to new company 
creation and helping them scale. 
Successful fintech companies are finding 
that partnerships often are key, including 
with fintech infrastructure companies—
developer-focused platform technologies 
based on APIs to solve complex operational 
challenges of providing financial services. 
These companies use software to leverage 
existing infrastructure such as payment 
rails, all types of bank accounts, customer 
information databases and certain 
compliance functions. This allows other 
fintech companies and incumbent banks to 
focus on building the core aspects of their 
businesses instead of spending on costly 
infrastructure, which lowers barriers to 
entry and promotes innovation. 
• Consider processing payments of 
all types: There’s a patchwork of 
government regulations that is expensive, 
complicated and risky. Enter Stripe, 
a payment processing for Internet 
businesses, and Marqeta, an API platform 
for prepaid debit and credit cards.
• Data aggregation: Consumers and 
businesses keep their money and 
investments in myriad financial accounts 
and are constantly trying to simplify their 
financial lives. Enter Plaid and Quovo 
(aggregating account data in an app-
based world). 
• Customer retention and cross-selling: 
Finding new revenue streams from 
current and prospective customers is 
critical. Enter DriveWealth (natively 
embedded modern brokerage platform). 
While global opportunities abound for 
fintech, there could be some bumpy times 
ahead. We will eventually head into a 
less buoyant economic climate, with 
interest rates rising and access to capital 
(potentially) shrinking. Fintech business 
models will be tested in new ways. 
As with other tech industry sectors, we are 
seeing a flight to quality: VCs are focusing 
investment on the “best of breed” fintech 
companies. In this environment, we believe 
fintech infrastructure companies are poised 
to continue to drive innovation in financial 
services by providing the tools and services 
that will become even more critical for 
other fintech companies and incumbent 
financial services firms to start and survive. 
These are the fintech companies to watch.
17 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
US fintech 
investment grows in 
2017: What’s next?
$0.9$0.7$0.7$1.3$1.2$1.7$2.1$4.6$7.5$5.4$6.5107
118
129
151
227
311
409
562
572
451
475
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
2017
Deal Value ($B)
# of Deals Closed
  
US VC activity in fintech
5.2%
5.9%
7.5%
7.7%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Fintech % of Total Deals
Fintech % of Total Deal Value
  
Fintech investment as percentage of total US VC activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Corporate venture investors have 
continued to play a growing role within 
the US VC industry, participating in rounds 
that amounted to 44% of all 2017 venture 
deal value. In total, CVCs participated 
in 1,268 completed financings worth a 
record amount of over $37 billion last year, 
reflecting YoY increases of 3% and 15%, 
respectively. While CVCs have certainly 
been active across the venture lifecycle, 
these investors have not been shy to cut 
large checks as the industry has continued 
to necessitate in order to participate in 
follow-on fundings. To illustrate, CVCs 
participated in roughly 29% of all venture 
financings completed above $25 million last 
year, the highest proportion we’ve seen 
since at least 2006. Further, over $11 billion 
worth of transactions completed last year 
also included at least one corporate venture 
investor. 
18 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Corporate VC
0
50
100
150
200
250
300
350
400
$0
$2
$4
$6
$8
$10
$12
$14
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
Angel/Seed
Early VC
Later VC
$10.0$6.5$7.9$12.6$11.7$14.3$26.9$34.7$32.5$37.4674
477
557
713
829
1,045
1,283
1,379
1,231
1,268
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
CVCs have continued participating in high volume of large deals 
US corporate VC participation activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Corporate VC activity ticks up in 2017 
US corporate VC participation activity
14.3%
15.7%
44.8%
44.4%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
CVC % of VC Deal Count
CVC % of VC Deal Value
CVCs taking part in higher % of deals 
US corporate VC participation % of total VC
PitchBook-NVCA Venture Monitor
As we continue to see emerging 
technologies develop in rapid cycles, access 
to intellectual property will continue 
to drive corporate VC investment. For 
example, nearly all of the major auto 
companies and tech giants are invested in 
AI-driven smart car technologies, helping 
boost their legacy R&D processes. Lyft’s 
$1.5 billion deal in December included 
investment from Google Capital, and the 
company previously took capital from 
General Motors (NYSE: GM) as well. Big 
pharma & biotech corporations have also 
looked to startups that are developing 
breakthrough technologies and drugs, 
especially considering the cost of drug 
development has soared in recent years. 
For instance, Grail’s $1.2 billion funding last 
quarter saw Merck (NYSE: MRK), Bristol-
Myers Squibb (NYSE: BMY) and Johnson & 
Johnson (NYSE: JNJ) all join in.
19 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
CVC 50M+ deals reach highest in decade 
US corporate VC activity (#) by size
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$50M+
$25-
$50M
$10M-
$25M
$5M-
$10M
$1M-
$5M
Under
$1M
CVC deal sizes continues to grow 
US corporate VC activity ($) by size
0
200
400
600
800
1,000
1,200
1,400
1,600
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
CVC following overall VC sector trends 
US corporate VC participation (#) by sector
$0
$5
$10
$15
$20
$25
$30
$35
$40
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Software holding onto top spot 
US corporate VC participation ($) by sector
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
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21 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Growth equity
$3.5$7.5$3.3$2.7$8.0$5.6$4.5$4.7$3.6$4.8$7.7$3.7$6.1$4.6$4.8$4.2$8.6$11.1$7.7$9.0$11.1$9.1$11.5$9.5$10.5$13.8$6.0$8.5$7.3$12.9$7.5$9.4 0
 50
 100
 150
 200
 250
 300
$0
$2
$4
$6
$8
$10
$12
$14
$16
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Deal Value ($B)
# of Deals Closed
$18.7$10.4$17.0$22.8$19.8$19.7$36.5$41.2$38.7$37.2553 
360 
496 
581 606 608 
802 878 
742 
777 
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deal Value ($B)
# of Deals Closed
GE continues strong run 
US growth equity activity
$35.0
$39.5
$134.1
$169.8
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Median Deal Size
Median Pre-money Valuation
Median GE sizes reaching new highs 
Median growth equity deal size and valuation ($M)
Deal volume slowed through back half of 2017 
US growth equity activity
As growth equity has grown, the 
median size and valuations of 
such deals has skyrocketed
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
22 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20072008200920102011201220132014201520162017$200M+
$100M-
$200M
$75M-
$100M
$50M-
$75M
$30M-
$50M
$15M-
$30M
21% of GE deals exceed $75M 
US growth equity activity (#) by size
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$200M+
$100M-
$200M
$75M-
$100M
$50M-
$75M
$30M-
$50M
$15M-
$30M
Growth in overall value is clear  
US growth equity activity ($) by size
0
100
200
300
400
500
600
700
800
900
1,000
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
Sector investment stays steady 
US growth equity activity (#) by sector
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
2008200920102011201220132014201520162017Commercial
Services
Consumer Goods
& Recreation
Energy
HC Devices &
Supplies
HC Services &
Systems
IT Hardware
Media
Other
Pharma &
Biotech
Software
PE growth firms primarily look at tech 
US growth equity activity ($) by sector
Having surged post-2013, the 
impact of the growth equity 
stage has been unmistakable
From 2014 through 2017’s end, 
the inflation of even the growth 
financing stage is clear
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
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. 
23 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
What’s your outlook for the venture capital 
industry given its trends in recent years?
Interest in the tech sector is strong for 
investors, companies and corporates alike, 
and venture capital remains the go-to 
source of funding for growing businesses. 
VC firms are bullish on tech, and the 
favorable fundraising environment is 
resulting in new expansion and opportunity 
funds. While raising VC funds for seed 
investing is challenging, there is plenty of 
capital for successful late-stage companies. 
In each of the last four years, annual US 
venture fundraising has exceeded $30 
billion, and that figure doesn’t include 
nontraditional investors such as SoftBank’s 
Vision Fund. With excessive dry powder 
in the ecosystem, companies are choosing 
to stay private longer. However, as the 
pressure to generate liquidity increases, 
there could be more M&A activity. 
What recent factors or market dynamics have 
impacted how SVB evaluates, invests in, or 
lends to the venture community? 
The pace of M&A exits was healthy in 2017. 
IPOs, however, were a different story. The 
growth in IPOs we had expected did not 
materialize. Normally, this would put a 
chilling effect on valuations and the pace 
of venture investing in general. Instead, 
capital continued to be available for 
private, late-stage companies throughout 
2017, resulting in valuations at the high 
end of the private company market that 
occasionally outpaced those seen in the 
public market. 
These dynamics impacted the venture 
debt market, too. With ample, relatively 
inexpensive equity financing available to 
breakout companies across multiple sectors, 
coming from less-traditional sources such 
as mutual funds, hedge funds, family 
offices, micro VCs and initial coin offerings 
(ICOs), many companies that would have 
otherwise been candidates for venture debt 
didn’t require this supplemental financing 
in order to fund their plan and/or reduce 
dilution. At the same time, other breakout 
companies elected to supplement their 
equity raise with unprecedented amounts 
of venture debt, which compelled us to 
reevaluate how we think about valuations, 
growth rates, burn rates, access to capital 
and the amount of debt that is healthy. 
We’ve seen anecdotes around the use of 
capital call loans by GPs across private equity 
and VC. What benefits do GPs realize?
While there are differing views on this 
subject, capital call lending provides GPs 
with a tool to fund investments and/or 
operating expenses in advance of receiving 
capital calls from the fund’s limited 
partners. VC and PE firms both use this tool, 
but typically see different benefits. Focused 
on operational benefits, VCs are attracted 
by the convenience of being able to fund 
an investment quickly while reducing the 
number and frequency of capital calls, but 
typically do not borrow for long periods of 
time before calling capital. In contrast, PE 
funds value those same benefits, but tend 
to borrow for longer periods of time so as 
to delay the eventual capital call, thereby 
improving fund IRR.
Have you noticed any changes in regional 
deal flow, specifically new trends in 
investment outside of Silicon Valley? If so, 
what is driving that? 
SVB has seen a dramatic increase in new 
capital sources and growing tech hubs in 
places such as Southern California, New 
York and London. New domestic capital 
sources such as family offices and high-net-
worth individuals and new foreign capital 
sources, mostly from Asia, are fueling 
the venture growth in SoCal, New York, 
Salt Lake City and Boston, to name some 
examples. Much like the pattern seen with 
successful Silicon Valley-based companies, 
employees of successful startups in these 
regions are leaving to start new ventures. 
VCs are also showing greater interest to 
invest in markets outside of Silicon Valley, 
exemplified by funds such as Steve Case’s 
“Rise of the Rest Fund.” 
Given the massive rise in fundraising in recent 
years, what do you think the future holds? 
We expect VC fundraising to remain strong 
considering the pace of innovation, growing 
pervasiveness of technology, increasing 
number of viable investment opportunities 
and the expectation that more mega funds 
will be created, such as SoftBank’s Vision 
Fund. Venture-backed companies are 
staying private longer, prompting larger 
capital investments to continue to support 
these companies. 
The venture industry has taken off since the end of the Great Recession, achieving figures unseen 
since the dot-com era. In the past few years, we’ve seen new dynamics take hold: Deal sizes grew 
while the number of completed financings declined; valuations rose as IPOs plummeted; and a 
variety of nontraditional investors became involved. We asked Silicon Valley Bank’s President Mike 
Descheneaux about his perspectives on the venture industry today and where it’s headed: 
Michael Descheneaux is the president of Silicon Valley Bank, 
and oversees the global commercial bank, private bank, credit 
administration and business analytics, as well as SVB Financial 
Group’s venture capital investment arm, SVB Capital. He is also a 
member of the executive committee of the company and serves on 
the board of directors for the company’s joint venture bank in China.
Michael joined SVB Financial Group in 2006 and was appointed chief 
financial officer in 2007. As CFO, Descheneaux was responsible for 
all finance, treasury and accounting functions for the company.
As market dynamics shift, lenders 
adapting strategies to fit 
Q&A with Michael Descheneaux, President of Silicon Valley Bank
24 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Credit insights: Debt vs. equity
8.5%47.4%26.6%12.6%4.9%0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Series Seed
Series A
Series B
Series C
Series D+
The venture debt market consists 
of a relatively small universe of 
lenders that provide loans which explicitly 
rely on the borrower’s continued access 
to venture equity as the primary source 
of repayment for the loan. This type 
of loan, typically referred to as growth 
capital, differs from loans that rely on other 
sources of repayment, such as cash flow or 
the collection of accounts receivable. 
Venture debt lenders evaluate both 
the durability of support from existing 
investors and probability of attracting 
interest from new, outside investors to 
ensure the loan is repaid. For these reasons, 
venture debt is deployed most broadly at 
the Series A stage, when reserves among 
the existing syndicate are typically at their 
apex and valuations are heavily influenced 
by anticipatory metrics, including technical 
or product development milestones. 
Looking back over the last eight quarters, 
debt-to-valuation ranges have remained 
fairly consistent – buoyed by either 
increasingly larger equity round sizes at the 
early stage or increasing valuations at the 
late stage. 
Typically Series A-B companies raise equity 
that supports nine to 12 months of runway 
and venture debt supplements by providing 
an additional three to six months. While the 
median debt-to-valuation ratio is typically 
higher for Series A-B than for later stage 
companies, the average equity round is also 
smaller which in turn means the average 
loan size is smaller. 
In contrast, later-stage companies (Series 
C-D) typically have lower median debt-
to-valuation ratios, but the average loan 
size grows along with the equity size for 
each successive round. The universe of 
companies that receive successive rounds 
of equity shrinks over time as valuations 
are increasingly correlated to business 
execution and less competitive companies 
disappear. Thus, should loan size increase 
with each successive round, too much debt 
can impact future equity negotiations. 
In prior business cycles, the equity 
progression described above (larger equity 
rounds / lower debt-to-valuation ratios) 
often forced the most successful later-
stage companies to diversify their investor 
syndicate beyond the VC ecosystem – in 
order to satisfy the increasingly larger 
funding cycles required to grow at scale. 
It was also generally true that super-
sized equity rounds often could not be 
accommodated in the private market, 
which drove companies to the public 
markets or an M&A deal. But now this 
pattern has reversed.
Super-sized rounds are now routinely 
being filled with private rather than public 
equity. In addition to being abundant, later 
stage PE has also been relatively cheap (for 
breakout companies) in historical terms. 
As a result, the super-sizing of the largest 
late stage funding rounds has effectively 
outstripped the capacity of the venture 
debt market to ‘match fund’ in some 
examples, and the highly competitive 
pricing dynamic for those same examples 
has increasingly placed later stage equity in 
direct competition with venture debt. 
  
Distribution of US venture debt by series
 
Debt-to-valuation (%) by quarter
6.1%
7.1%
7.6%
6.5%
6.9%
6.5%
6.2%
5.9%
0%
2%
4%
6%
8%
10%
12%
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
2015
2016
2017
Third Quartile
First Quartile
Median
6.7%
8.0%
5.7%
4.2%
3.3%
0%
2%
4%
6%
8%
10%
12%
Seed
Series A
Series B
Series C
Series D
Third Quartile
First Quartile
Median
 
Debt-to-valuation (%) by stage
Source: Silicon Valley Bank analysis 
Source: Silicon Valley Bank analysis 
Source: Silicon Valley Bank analysis 
Note: Fluctuations in financial and credit ratios can be influenced by changes in the 
underlying subsector composition on the measurement date. 
25 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Startup financial 
insights
As the venture ecosystem 
continues to benefit from 
record fundraising, access to capital and 
valuation growth, technology companies 
are demonstrating traction and validating 
their business models at increasingly earlier 
stages in their fundraising lifecycle. One of 
the key indicators of life stage and business 
model traction is a company’s revenue run 
rate, or annualized revenue. 
While early-stage VC-backed tech deals 
are rarely valued on the basis of revenue 
alone, many successful companies have 
demonstrated a multimillion-dollar revenue 
run rate at the time of their Series A and 
Series B fundraising. Based on SVB analysis, 
US tech companies raising Series A rounds 
2011-2017 showed a median revenue run 
rate of $1.5 million, while companies raising 
their Series B round showed more than 
double that, at $3.5 million. 
At the growth stage, companies continue 
to scale operations and build a more 
predictable conversion funnel, resulting in 
greater revenue traction at their Series C 
and Series D rounds. Companies raising a 
Series C round showed a median revenue 
run rate of $7.5 million, while companies 
raising their Series D round showed nearly 
double that, at $13.7 million. 
While revenue growth is a useful gauge 
of business model traction, especially at 
earlier stages, today’s venture-backed tech 
companies are demonstrating operating 
discipline, thanks in part to declining 
operating costs over time, and charting a 
path to profitability as they mature through 
the fundraising life cycle. SVB has observed 
that US technology companies raising their 
Series A and Series B rounds post median 
operating expenses that are more than 
double their revenues: -145% for Series A 
and -120% for Series B. 
As companies move to growth stage 
at Series C and Series D, realizing more 
significant traction and revenue growth, 
operating margins tend to improve 
significantly. Tech companies raising 
their Series C round showed a median 
operating margin of approximately -75%, 
an improvement of 45% from the Series 
B round, and a median operating margin 
of -53% at their Series D round. At this 
stage, successful companies continue to 
show operating margin improvement and 
revenue growth as they move to the exit 
stage of the J-curve and, eventually, realize 
their valuation through an exit event.
$1.5
$3.5
$7.5
$13.7
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
$20
Series A
Series B
Series C
Series D
Third Quartile
First Quartile
Median
 
Startup revenue run rate ($M) on deal date by series
-145%-120%-77%-53%-160%
-140%
-120%
-100%
-80%
-60%
-40%
-20%
0%
Series A
Series B
Series C
Series D
  
Median operating margin (%) on deal date by Series
Source: Silicon Valley Bank 
*Data from 2011-2017
Source: Silicon Valley Bank 
*Data from 2011-2017
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. 
 
©2017 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).
26 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Exits
$9.1$4.8$7.9$9.8$8.8$9.2$7.7$8.6$6.8$26.3$12.1$10.5$4.0$8.7$11.4$13.1$14.0$11.4$18.2$36.8$8.7$10.5$15.2$15.2$11.1$16.6$15.9$9.3$17.0$12.0$12.2$9.80
50
100
150
200
250
300
$0
$5
$10
$15
$20
$25
$30
$35
$40
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Capital Invested ($B)
# of Deals Closed
$16.5$15.7$31.6$34.2$55.7$37.2$80.3$49.6$52.9$51.0484
479
698
738
867 891
1,065
1,003
857
769
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Exit Value ($B)
# of Exits Closed
Exits continue to slide, leaving industry in crunch 
US VC-backed exit activity
Exits slide during eight of past 11 quarters 
US VC-backed exit activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
We’ve continued to see completed exit 
counts trend lower following a surge in VC-
backed company sales and liquidity events 
between 2009 and 2014. However, despite 
counts moving lower, sales have been 
significantly larger and aggregate exit value 
has remained heightened. 2017 saw more 
than $51 billion exited across some 769 
liquidity events, equating to a marginal YoY 
decline of 3.6% in terms of aggregate exit 
value, yet a drop of over 10% in terms of 
volume. Buoyed by SNAP’s massive capital 
raise ($3.4B) and a host of backlogged exits 
that came to market early in the year, Q1 
showed signs of a rebounding exit market 
with nearly $17 billion exited across 228 
sales. However, each subsequent quarter 
saw exit activity in terms of both value 
and volume decline. In fact, the 167 exits 
completed in 4Q registers as the lowest 
figure we’ve seen since Q2 2011. 
We’ve harped on today’s industry dynamic, 
which can be summarized by a few items 
such as larger round and exit sizes, fewer 
sales and older companies raising capital. 
This has certainly manifested itself on the 
back end of the venture cycle with the 
median exit size across all exit types soaring 
to an unprecedented level. At $85 million 
last year, the median exit size jumped close 
to 17% YoY. This figure not only comes in as 
the largest median exit size we’ve recorded 
in at least a decade, but also the largest 
YoY percentage increase in that metric. 
This trend also holds true when looking at 
strategic and financial acquisitions, which 
paid a median of $87 million to acquire 
venture-backed businesses last year— also 
the highest figure we’ve seen on record 
in at least a decade. With sales processes 
continuing to push out, the median time 
to exit in the venture market has reached 
a record 5.6 years. Undoubtedly driven 
by the ability of many companies to raise 
larger sums of late-stage private capital, 
companies are coming to market as larger 
entities and as a result, exit sizes and 
valuations have hit uncharted territory. 
27 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
9.7x
9.3x
7.7x
9.1x
9.1x
10.3x
9.8x
10.4x
10.1x
10.5x
8,635
8,076
857 
769 
0
2,000
4,000
6,000
8,000
10,000
12,000
0.0x
2.0x
4.0x
6.0x
8.0x
10.0x
12.0x
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Investments/Exits
# of Investments
# of Exits
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010
2011
2012
2013
2014
2015
2016
2017
Acquisi�on
IPO 
Buyout
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
20102011201220132014201520162017$500M+
$100M-
$500M
$50M-
$100M
$25M-
$50M
Under
$25M
Exits are getting larger, however 
US VC-backed exit (#) by size
Buyouts account for 19% of exits 
US VC-backed exit activity (#) by type
Despite slowing deal flow, exits fall further 
US VC investment-to-exit ratio
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Despite exit volume declining, we’ve 
noticed a shift in the makeup of exit 
types being utilized by management 
teams. Strategic acquisitions typically 
represent the bulk of sales by sheer 
count, yet as M&A activity across the 
board has lightened up, VC-backed sales 
to strategics last year declined roughly 
20% YoY. That said, we’ve continued to 
see private equity play a larger role in the 
venture market. Nearly $7 billion worth 
of venture-backed exits were completed 
by private equity last year across 146 
sales, reflecting YoY growth of over 200% 
in terms of total exit value, and a jump 
of 33% in terms of completed sales to 
PE. With the proliferation of both tech-
focused private equity funds, as well as a 
lending ecosystem that has grown to better 
understand how to stack debt against 
recurring revenue software businesses, we 
expect this outlet to remain in place for 
venture-backed management teams. Last, 
the IPO markets rebounded as well last 
year, with close to $10 billion raised across 
58 completed listings, reflecting significant 
increases of 236% and 41%, respectively. 
28 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Fundraising
$8.5$3.5$3.8$3.9$6.8$6.4$3.3$8.7$8.8$4.5$7.9$2.5$6.3$4.5$4.8$5.5$10.0$9.8$6.8$8.7$7.7$11.7$3.8$11.6$10.4$12.8$10.1$6.9$8.2$11.8$5.7$6.70
10
20
30
40
50
60
70
80
90
$0
$2
$4
$6
$8
$10
$12
$14
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
2010
2011
2012
2013
2014
2015
2016
2017
Capital Raised ($B)
# of Funds Closed
$30.1$12.0$19.8$25.3$23.7$21.2$35.3$34.8$40.2$32.4185
119
154
147
188
206
274
259
281
209
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Capital Raised ($B)
# of Funds Closed
$143B raised since 2014 
US VC fundraising activity
Fundraising showed signs of slowing over past six months 
US VC fundraising activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
While coming in lower than the total 
amount of capital raised in 2016, on a 
historical basis, managers were still able 
to garner considerable success on the 
fundraising trail last year. More than $32 
billion was raised across 209 completed 
closes, equating to a YoY drop of close to 
20% in terms of total capital raised and 26% 
in terms of the number of vehicles closed. 
Interestingly, barring activity between 2014 
and 2016, more vehicles closed last year 
than in any year in the last decade, with 
more capital raised than in any year during 
that same timeframe. 
Buoyed by a mix of outsized fundraises 
by the likes of NEA ($3.3 billion) and 
Mithril Capital Management ($850 million), 
along with a steady pace of fund closings, 
2017 was poised to match the record 
amount of capital ($40 billion) raised in 
2016. However, as we transitioned to the 
back half of the year, fund sizes remained 
29 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$2.4$1.1$0.9$1.9$1.6$1.5$2.0$1.7$2.2$3.330
25
32
18
27
21
39
25
25
35
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Capital Raised ($B)
# of Funds Closed
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$1B+
$500M-
$1B
$250M-
$500M
$100M-
$250M
$50M-
$100M
Under
$50M
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008200920102011201220132014201520162017$1B+
$500M-
$1B
$250M-
$500M
$100M-
$250M
$50M-
$100M
Under
$50M
 
US VC fundraising activity (#) by size
 
US VC fundraising activity ($) by size
First-time funds finding results 
US first VC fundraising activity
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
heightened on a median basis, but total 
closings dropped off dramatically, with both 
3Q and 4Q seeing 36 and 45 total vehicles 
closed, respectively. This compares to the 
64 funds we saw close in each of the first 
two quarters of last year. Given the massive 
uptick in vehicles we’ve continued to see 
come to market in recent years, along with 
ample dry powder yet to be deployed, 
seeing commitments slow to a certain 
extent is likely a positive to the overall 
industry, as capital availability certainly isn’t 
an issue for the market today. 
Despite the drop in fund counts in 2H, 
some of the largest vehicles to close in 
2017 came then, such as TPG’s Rise Fund, 
which closed on $2 billion in 4Q, and 
Institutional Venture Partners’ IVP XVI, 
which closed on $1.5 billion in September 
of last year. To that point, median fund sizes 
have continued to rise, coming in at $60 
million last year, relative to $50 million in 
2016 and just $32 million in 2015. 
As we’ve noticed across the PE market 
as well, first-time fund managers have 
continued to garner interest from LPs 
across all stages. More than $3.3 billion was 
raised by such managers last year across 
35 vehicles, a growth of 47% and 40%, 
respectively. Further, first-time managers 
raising sub $50 million vehicles have also 
had considerable success, raising close 
to $380 million last year across 15 funds, 
equating to a jump of some 23% in terms of 
total capital raised across the same number 
of vehicles that closed in the bucket in 
2016. 
30 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
$50.0
$60.1
$149.3
$156.4
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
$200
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Median
Average
2.38 2.40
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
1.3x
1.5x
0.0x
0.2x
0.4x
0.6x
0.8x
1.0x
1.2x
1.4x
1.6x
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
19.0
13.1
19.4
15.9
0
5
10
15
20
25
30
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Median
Average
Median fund size jumps past $60M 
Median & average VC fund size ($M)
Time to close fell last year 
Median & average time (months) to close VC fund
Firms raising next funds faster 
Average time (years) between funds
Follow-on funds growing significantly 
Median step-up between funds
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Looking ahead to 2018, fund 
sizes look set to only grow
2017 saw a remarkable 20% 
YoY increase in the average step-
ups of venture funds
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32 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
4Q league tables
Plug and Play Tech Center
11
Innovation Works
10
Social Starts
9
Right Side Capital 
Management
8
New Enterprise Associates
7
SV Angel
7
Y Combinator
7
FundersClub
6
Techstars
6
500 Startups
5
Eniac Ventures
5
Liquid 2 Ventures
5
PLG Ventures
5
TEDCO
5
Andreessen Horowitz
4
Greycroft
4
M25 Group
4
Social Capital
4
Most active investors 
angel/seed
Most active investors 
early stage
Most active investors 
late stage
New Enterprise Associates
15
Keiretsu Forum
14
Y Combinator
10
Kleiner Perkins Caufield & 
Byers
9
Plug and Play Tech Center
9
True Ventures
8
Accel
7
GV
7
Intel Capital
7
Keiretsu Capital
7
Khosla Ventures
7
Lerer Hippeau Ventures
7
Sequoia Capital
7
ARCH Venture Partners
6
Comcast Ventures
6
Lux Capital
6
Redpoint Ventures
6
RRE Ventures
6
Salesforce Ventures
6
Slow Ventures
6
Alexandria Venture 
Investments
5
AME Cloud Ventures
5
Great Oaks Venture Capital
5
Greycroft
5
Lightspeed Venture Partners
5
Next47
5
Shasta Ventures
5
SV Angel
5
Tiny Capital
5
Versant Venture Management
5
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
Keiretsu Forum
11
Kleiner Perkins Caufield & 
Byers
10
GV
9
New Enterprise Associates
7
Norwest Venture Partners
7
Think +
7
General Catalyst Partners
6
Salesforce Ventures
6
Baillie Gifford
5
Flagship Pioneering
5
Menlo Ventures
5
Spark Capital
5
True Ventures
5
Bain Capital Ventures
4
Canaan Partners
4
DBL Partners
4
Fidelity Management & 
Research
4
GE Ventures
4
Keiretsu Capital
4
Lightspeed Venture Partners
4
Meritech Capital Partners
4
Revolution
4
SharesPost
4
PitchBook-NVCA Venture Monitor
33 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Company
Deal size ($M)
Series/stage
Date
HQ
State
Industry
Lyft
 1,500.00 
Series H
12/5/2017
San Francisco
California
Software
Grail
 1,211.66 
Series B
11/22/2017
Menlo Park
California
Pharma and Biotech
Faraday Future
 1,000.00 
Early Stage VC 
12/22/2017
Los Angeles
California
Transportation
Magic Leap
 502.00 
Series D
10/17/2017
Plantation
Florida
Computer Hardware
Compass
 500.00 
Early Stage VC 
12/7/2017
New York
New York
Consumer Products and 
Services
SpaceX
 450.00 
Series H
11/27/2017
Hawthorne
California
Aerospace & defense
Essential Products
 300.00 
Series B
10/12/2017
Palo Alto
California
Consumer Durables
Ginkgo Bioworks
 275.00 
Series D
12/14/2017
Boston
Massachusetts
Pharma and Biotech
Harmony Biosciences
 270.00 
Early Stage VC 
10/5/2017
Plymouth 
Meeting
Pennsylvania
Pharma and Biotech
Via 
 250.00 
Early Stage VC 
10/2/2017
New York
New York
Software
Top 10 largest US VC deals in 4Q 2017
Top 10 largest US VC funds closed in 4Q 2017
Top five largest US VC-backed IPOs in 4Q 2017
Largest US VC acquisitions in 4Q 2017
Fund name
Investor
Fund size ($M)
Close date
HQ
State
TPG Growth
The Rise Fund
$2,000.00
10/4/2017
 Washington 
District of 
Columbia 
Flagship Pioneering
Flagship Pioneering Fund VI
$618.00
12/20/2017
 Cambridge 
 Massachusetts 
Andreessen Horowitz
AH Bio Fund II
$450.00
12/20/2017
Menlo Park
 California 
Frazier Healthcare Partners
Frazier Life Sciences IX
$419.00
11/1/2017
Seattle
 Washington 
Redpoint Ventures
Redpoint Omega III
$400.00
10/2/2017
Menlo Park
 California 
Icon Ventures
Icon Ventures VI
$263.00
10/11/2017
Palo Alto
 California 
Vida Ventures
Vida Ventures
$254.80
12/5/2017
Boston
 Massachusetts 
Illumina Ventures
Illumina Innovation Fund I
$230.00
10/16/2017
San Francisco
 California 
Owl Ventures
Owl Ventures II
$185.00
10/19/2017
San Francisco
 California 
M33 Growth
M33 Growth I
$180.00
10/13/2017
Boston
 Massachusetts 
Company
Exit size ($M)
Exit post-val ($M) Date
HQ
State
Industry
Razer
 528.73 
 4,407.39 
13-Nov-2017
San Francisco
California
Computer Hardware
Switch
 531.25 
 4,200.25 
5-Oct-2017
Las Vegas
Nevada
IT Services
CarGurus
 150.40 
 1,684.90 
12-Oct-2017
Cambridge
Massachusetts
Transportation
Denali Therapeutics
 250.00 
 1,583.63 
8-Dec-2017
South San 
Francisco
California
Pharma and Biotech
Stitch Fix
 120.00 
 1,527.00 
17-Nov-2017
San Francisco
California
Retail
Company
Exit size ($M)
Acquirer(s)
Date
HQ
State
Industry
NeoTract
1,100.00
 Teleflex
2-Oct-2017
Pleasanton
California
Healthcare Devices and 
Supplies
Musical.ly
1,000.00
Cheetah Mobile, 
Bytedance
19-Dec-2017
Santa Monica
California
Software
ZirMed
750.00
Bain Capital, 
Navicure
1-Nov-2017
Louisville
Kentucky
Healthcare Technology 
Systems
Black Duck
547.00
Synopsys
12-Dec-2017
Burlington
Massachusetts
Software
nuTonomy
450.00
Aptiv
21-Nov-2017
Cambridge
Massachusetts
Software
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
PitchBook-NVCA Venture Monitor
34 
4Q 2017 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
141
New York
District 12
109
California
District 18
82
New York
District 10
57
California
District 14
52
California
District 52
42
Massachusetts
District 7
42
California
District 17
38
California
District 13
32
California
District 33
29
Washington
District 7
29
Massachusetts
District 5
27
Illinois
District 7
22
Colorado
District 2
20
Colorado
District 1
18
California
District 15
16
Pennsylvania
District 14
16
California
District 49
15
Texas
District 21
15
Texas
District 25
14
New York
District 7
13
District of 
Columbia
Delegate 
District
12
Massachusetts
District 4
11
Massachusetts
District 8
11
Virginia
District 8
11
Arizona
District 9
9
California
District 2
9
California
District 28
9
North Carolina
District 6
9
California
District 19
8
North Carolina
District 4
8
Ohio
District 3
8
Tennessee
District 5
8
Utah
District 3
8
Wisconsin
District 2
8
US VC activity by  
Congressional District
State
Deal Count
California
615
New York
219
Massachusetts
132
Texas
83
Washington
72
Colorado
59
Florida
48
Illinois
46
Pennsylvania
43
North Carolina
41
Virginia
32
Utah
31
Ohio
29
Arizona
24
Maryland
24
New Jersey
22
Oregon
22
Georgia
21
Tennessee
19
Indiana
16
Wisconsin
16
Connecticut
14
District of Columbia
14
Minnesota
14
Michigan
11
Kentucky
10
Delaware
8
Idaho
8
Kansas
7
Iowa
6
Louisiana
6
Nevada
6
South Carolina
6
Arkansas
5
MSA
Deal Count
San Francisco-Oakland-Fremont, 
CA
310
New York-Northern New Jersey-
Long Island, NY-NJ-PA
227
Boston-Cambridge-Quincy, 
MA-NH
130
San Jose-Sunnyvale-Santa Clara, 
CA
112
Los Angeles-Long Beach-Santa 
Ana, CA
106
San Diego-Carlsbad-San Marcos, 
CA
61
Seattle-Tacoma-Bellevue, WA 
61
Austin-Round Rock, TX
47
Washington-Arlington-
Alexandria, DC-VA-MD-WV
46
Chicago-Naperville-Joliet, IL-
IN-WI
44
Denver-Aurora, CO
32
Philadelphia-Camden-
Wilmington, PA-NJ-DE-MD
23
Miami-Fort Lauderdale-
Pompano Beach, FL
22
State
Deal Count
Hawaii
5
Missouri
5
Montana
5
Nebraska
5
Wyoming
4
Maine
3
New Hampshire
3
North Dakota
3
Oklahoma
3
Alabama
2
Alaska
2
New Mexico
2
South Dakota
2
Vermont
2
Mississippi
1
Puerto Rico
1
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. 
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 
4Q 2017 PITCHBOOK-NVCA VENTURE MONITOR
Why we teamed up
Meet the PitchBook-NVCA Venture Monitor
NVCA is recognized as the go-to organization for  
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release are the industry standard. PitchBook is 
the leading data software provider for venture 
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insights on the venture ecosystem and better 
advocate for an ever-evolving industry.
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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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comps, cap tables and series terms.
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in on other firms or strategic acquirers 
whose investment preferences match your 
portfolio company.
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