SE AT TLE
NEW YORK
$8.4B VC invested in Seattle-based startups
$64.4M: 1H 2016 late-stage premoney valuation
CHICAGO $9.95B: total VC-backed exit
BOSTON
value since 2010
PHILADELPHIA
SAN FRANCISCO
WASHINGTON, DC
$203.8B AUM in SF MSA
AUSTIN
SAN JOSE
LOS ANGELES SAN DIEGO
Most VC invested in 1st financings ever in 2015: $324M
ATL ANTA
Credits & Contact PitchBook Data, Inc. JOHN GABBERT Founder, CEO ADLEY BOWDEN Vice President, Market Development & Analysis
Content GARRET T JAMES BL ACK Senior Analyst BRIAN LEE Senior Analyst J ENNIFER SAM Senior Graphic Designer NICK LINTON Graphic Designer MORGAN THEL ANDER Editorial Intern
Contact PitchBook pitchbook.com
Contents
RESE ARCH
[email protected] EDITORIAL
[email protected] SALES
[email protected] Introduction & Ecosystem Size Ranking 4-5 San Francisco-Oakland-Fremont
6-8
New York-Northern NJ-Long Island
9-11
San Jose-Sunnyvale-Santa Clara
12-14
Boston-Cambridge-Quincy
15-17
Los Angeles-Long Beach-Santa Ana
18-20
Seattle-Tacoma-Bellevue
21-23
Washington, DC-Arlington-Alexandria
24-26
Austin-Round Rock
27-29
Chicago-Naperville-Joliet
30-32
San Diego-Carlsbad-San Marcos
33-35
Philadelphia-Camden-Wilmington
36-38
Atlanta-Sandy Springs-Marietta
39-41
Sample Use Cases
42-44
COPYRIGHT © 2016 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.
Photos credit: Thomas Moskal, Wikimedia Commons
3 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
How do we analyze a VC ecosystem? Introduction In any opaque investment market—particularly venture capital—personal networks are crucial, whether for purposes of exchanging capital, sharing information or collaborating. Venture capital as an industry has been driven by the evolution of such networks in urban settings, due to the practical benefits of proximity and access to travel, among other urban-related factors. Accordingly, it’s always been a goal for us at PitchBook to provide comprehensive datasets & accompanying analysis on a regional level, lending greater insight into venture trends at a more granular level. Quantifying an ecosystem is difficult, but by breaking down relevant datasets and statistics by metropolitan statistical area (MSA), it’s possible to get a better sense of how macro, national trends are composed of a loose patchwork of local venture environments, not to mention how those national trends may or may not hold on the micro scale. But where to start?
M AKE WAY FOR
SMARTER, ON-THE-FLY MEETING PREP Introducing PitchBook Mobile. The same excellent data, technology and service from the PitchBook Platform, now available on a mobile device.
What made the most sense was to begin with a broad, macro view of VC activity by MSA. Consequently, we have produced the largest PitchBook report ever: over 40 pages of key VC and external datasets for the top 12 US MSAs (in terms
Available for
of overall deal flow). Down the road, we will develop frameworks for more inSearch: “PitchBook”
depth scrutiny such as composite scores of each ecosystem’s health, as well as datasets tailored to each MSA’s unique attributes. Those endeavors will take quite some time, hence why this first installment rather focuses on top-level statistics with a brief section detailing potential use cases and a ranking of ecosystems by size alone. Is every single relevant factor included? No, as that is frankly impossible. This report is intended to serve as an introductory base on which to build smaller, more analytically rigorous examinations of regional data and potential correlations or causations between external and internal factors for the venture industry. In large part, it is also meant as a jumping-off point for your own analysis, as well as a potential reinforcement for what you already know and/or have concluded. As this is the inaugural installment of the series, we welcome your feedback and questions—reach out to us at
[email protected].
US +1 206.623.1986 UK +44 (0)207.190.9809 GARRET T JAMES BL ACK
[email protected] pitchbook.com
Senior Analyst
4 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
6
ECOSYSTEM RANKINGS
7 11
3
4
8
1 2 5 12
9 10
MSA
Size of VC ecosystem, ranked
Total VC funds raised since 2006
Total VC invested since 2010
Total # of VC rounds since 2010
San Francisco
#1
#1
$117.6 billion
#1
$101.4 billion
#1
9,710
#1
$90.8 billion
San Jose
#2
#4
$35.5 billion
#2
$43.3 billion
#3
4,152
#2
$63.5 billion
New York
#3*
#2
$43.6 billion
#3
$33.9 billion
#2
6,174
#4
$17.6 billion
Boston
#4
#3
$41.2 billion
#4
$30.7 billion
#4 3,664
#3
$28.7 billion
Los Angeles
#5
#9
$2.7 billion
#5
$21.3 billion
#5 3,403
#5
$11.2 billion
Seattle
#6
#5
$7.6 billion
#7
$8.4 billion
#6
1,717
#10
$6.7 billion
Chicago
#7
#7
$3.4 billion
#8
$8.3 billion
#9
1,348
#6
$9.95 billion
Washington, DC
#8
#6
$4.8 billion
#9
$8.2 billion
#7
1,416
#9
$7.4 billion
San Diego
#9
#11
$1.5 billion
#6
$9.4 billion
#10 1,317
#7
$8.7 billion
Austin
#10
#10
$1.9 billion
#10
$6.6 billion
#8
1,376
#12
$3.7 billion
Philadelphia
#11
#8
$3.0 billion
#12
$4.8 billion
#11 1,003
#11
$5.4 billion
Atlanta
#12
#12
$1.15 billion
#11
$5.0 billion
#12
#8
$7.8 billion
837
Total exit value since 2010
Source: PitchBook. *As of 6/30/2016. New York and San Jose technically tied but given San Jose’s exit value and VC invested we gave it second place.
Note: This ranking was generated by weighting capital raised, VC invested, VC activity and venture-backed exit value equally, tallying up their ranking in each area, then summing and sorting from lowest to highest, with a lower score indicating a larger ecosystem. Is this definitive? Hardly—you can quibble over which metric is more representative of an ecosystem’s size, or point to additional factors that are not included. But hopefully this table will provide food for thought as you go on to explore each MSA in detail in the pages below. 5 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
San Francisco-Oakland-Fremont MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
San Francisco-Oakland-Fremont
$203.8 billion
$117.6 billion
45
$101.4 billion
9,710
$90.8 billion Source: PitchBook *As of 6/30/2016
San Francisco MSA VC activity
$30 $25
Select local Fortune 500 companies
Deal value ($B)
# of deals closed
Angel/Seed
Early-stage VC
2,500 2,000
Late-stage VC
$20
1,500
$15 1,000
$10
656
$5
260
$0
146 2010
2011
2012
2013
2014
2015
500 0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Outcome mgmt
$77.5
100
GE Ventures, Humana Ventures, Norwest Venture Partners
B2C electronics
$42.9
96
Forward Partners, Temasek Holdings
Database software
$3.1
99
Giesecke & Devrient, Plug & Play, Comerica Source: PitchBook. *As of 6/30/2016
6 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in San Francisco MSA by year of financing
20
15
2010
16
2011
16
2012
23
2013
20
2014
28
2015
2016*
Source: PitchBook *As of 6/30/2016
Activity has slowed significantly in 2016 thus far San Francisco MSA first venture financings Deal value ($M)
Currently, many rounds still skew averages high SF MSA median & average VC round size ($M) $30
# of deals closed
683
733
Median
763
Average $25.0
$25
694
$20
584
$18.4
$15 $10
350 223
$5.5
$5
$3.4
$733
$1,629
$1,404
$1,515
$1,815
$2,072
$743
$0
2010
2011
2012
2013
2014
2015
2016*
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Source: PitchBook *As of 6/30/2016
San Francisco-Oakland-Fremont
Select statistics
Employment’
2.3 million
Change in employment’’
2.9%
Median two-bedroom apartment rent, San Francisco^
$4,650
Change in rent price, San Francisco*
-1.5%
Office lease median rate, $ per square foot per year^
$77
Number of listings in the last 90 days^
661
$31.7
Annual mean wage, computer & mathematical occupations**
$108,960
$6.3
$8.5
Change in pay, full-time private industry employees***
3.5%
2015
2016*
SF MSA median pre-money valuation ($M) by stage Angel/Seed
Early-stage VC $153.4
Late-stage VC
$25.3
2010
2011
2012
2013
2014
$141.3
Source: PitchBook *As of 6/30/2016
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
7 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Select accelerators, incubators, & universities in SF MSA
Investors (#) active by HQ in San Francisco MSA
In MSA
Out of MSA
2,942
2,724
2,173 1,628 1,226 996
818
2015’s most active investors by VC deals (#) in San Francisco MSA
371
490
574
635
712
664
2010
2011
2012
2013
2014
2015
81
Andreessen Horowitz
45
Khosla Ventures
44
New Enterprise Associates
42
2010-2016* San Francisco MSA VC activity (#) by sector
Commercial Services
Kleiner Perkins Caufield & Byers
38
GV
36
Accel Partners
34
SV Angel
32
Greylock Partners
30
Data Collective
30
985
1,415
40
Consumer Goods & Recreation Energy
340 198 749 294
Healthcare Services/Supplies/Systems IT Hardware
527
Media
462 4,740
Pharmaceuticals and Biotechnology Software Other
Source: PitchBook
Source: PitchBook *As of 6/30/2016
San Francisco MSA VC-backed exits (#) by type
San Francisco MSA VC-backed exit activity Exit value ($B)
250
# of exits
Acquisition
213 181 139
2016*
Source: PitchBook *As of 6/30/2016
500 Startups
First Round Capital
329
188
IPO
Buyout
200
187
145
150
$5.3
$27.0
$10.1
$19.6
$11.3
$13.6
100
$4.0
87
50
2010
2011
2012
2013
2014
2015
2016*
0
Source: PitchBook *As of 6/30/2016
2010
2011
2012
8 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
New York-Northern New Jersey-Long Island MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
New York-Northern New Jersey-Long Island
$97.8 billion
$43.6 billion
16
$33.9 billion
6,174
$17.6 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
New York MSA VC activity $10 $8 $6
Deal value ($B)
1,400
# of deals closed
Angel/Seed
1,200
Late-stage VC
1,000
Early-stage VC
800
$4
481
$2
230
600 400 200
164 87
$0 2010
2011
2012
2013
2014
2015
0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Educational software
$2.2
99
Edovate Capital, Techstars, Kaplan EdTech Accelerator
Business software
$17.1
91
Bessemer Venture Partners, CrunchFund, Canaan Partners Source: PitchBook. *As of 6/30/2016
9 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
New York-Northern New Jersey-Long Island
Select statistics
Employment’
9.52 million
Change in employment’’
1.5%
Median two-bedroom apartment rent, New York^
$4,600
Change in rent price, New York*
0.2%
Office lease median rate, $ per square foot per year^
$67
Number of listings in the last 90 days^
2,645
Annual mean wage, computer & mathematical occupations**
$97,570
Change in pay, full-time private industry employees***
2.3%
Select accelerators, incubators, & universities in NY MSA
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
Indicating a dose of caution, first financings are down NY MSA first venture financings
2010-2016* NY MSA VC activity (#) by sector
Commercial Services
Deal value ($M)
629
# of deals closed
1,049
531
518
478
791 460 59 264 88
357
Consumer Goods & Recreation Energy Healthcare Services/Supplies/Systems IT Hardware Media
571 190
2,701
266
$491
$670
$642
$817
$1,873
$1,314
$408
167
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
NY MSA median pre-money valuation ($M) by stage
Other Source: PitchBook *As of 6/30/2016
Disparity suggests increased vetting of prospects NY MSA median & average VC round size ($M) $10
$140 Angel/Seed
Early-stage VC
$120
Median
$9
Late-stage VC $114.7
Pharmaceuticals and Biotechnology Software
$9.5
Average
$8.6
$8 $7
$100
$6 $80 $64.4 $60
$5 $4 $3.0
$3
$40 $23.4
$20
$27.0
2011
2012
2013
2014
$2 $1
$5.6
$6.5
2015
2016*
$0 2010
$2.0
$0 2010
2011
2012
Source: PitchBook *As of 6/30/2016
10 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
M E D I A N E M P LOY E E CO U N T Median employee # at startups in New York MSA by year of financing
26
16
2010
15
2011
30
2012
18
2013
17
2014
21
2015
2016*
Source: PitchBook *As of 6/30/2016
2015’s most active investors by VC deals (#) in New York MSA
Investors (#) active by year, HQ in NY MSA In MSA
Out of MSA
1,841
Lerer Hippeau Ventures
29
Social Starts
24
500 Startups
21
General Catalyst Partners
20
Thrive Capital
19
Greycroft Partners
17
RRE Ventures
16
192
Great Oaks Venture Capital
16
2016*
New Enterprise Associates
15
New York Angels
15
1,599
1,321 1,041 793
753
531 181
236
276
336
2010
2011
2012
2013
379
362
2014
2015
Source: PitchBook *As of 6/30/2016.
15
BoxGroup
Source: PitchBook
NY MSA VC-backed exit activity Exit value ($B)
NY MSA VC-backed exits (#) by type 120
# of exits
107 96
95
Acquisition
IPO
Buyout
100
92
Source: PitchBook *As of 6/30/2016
80
51
55 45
60
$2.1
$2.4
$3.0
$3.6
$2.5
$2.9
$1.1
40
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
20
0 2010
2011
11 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2012
2013
2014
2015
2016*
San Jose-Sunnyvale-Santa Clara MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
San Jose-Sunnyvale-Santa Clara
$89.7 billion
$35.5 billion
14
$43.3 billion
4,152
$63.5 billion Source: PitchBook *As of 6/30/2016
San Jose MSA VC activity
Select local Fortune 500 companies
$12 $10
Deal value ($B)
# of deals closed
Angel/Seed
Early-stage VC
1,000 800
Late-stage VC
$8
600
$6 400
$4
247
$2
106 74 67
$0 2010
2011
2012
2013
2014
2015
200 0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
QuantumScape
Energy storage
$146.3
98
Khosla Ventures, KPCB, Lightspeed Venture Partners
Application software
$29.9
97
Walden International, Alloy Ventures, HighBAR Partners Source: PitchBook. *As of 6/30/2016
12 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in San Jose MSA by year of financing
22
20
2010
35
2011
21
2012
2013
25
22
2014
34
2015
2016*
Source: PitchBook *As of 6/30/2016
San Jose-Sunnyvale-Santa Clara
Select statistics
Employment’
1.1 million
Change in employment’’
3.7%
Median two-bedroom apartment rent, San Jose^
$2,670
Change in rent price, San Jose*
0.3%
Office lease median rate, $ per square foot per year^
$48
Number of listings in the last 90 days^
768
Annual mean wage, computer & mathematical occupations**
$128,850
Change in pay, full-time private industry employees***
N/A
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
Select accelerators, incubators, & universities in San Jose MSA
2010-2016* San Jose MSA VC activity (#) by sector
Commercial Services 527
San Jose MSA first venture financings # of deals closed
305
328
288 53 116 369
Deal value ($M)
283
479
Healthcare Services/Supplies/Systems IT Hardware Media
237
231
Consumer Goods & Recreation Energy
2,080
164
154 86
Pharmaceuticals and Biotechnology Software Other
$549
$610
$732
$762
$770
$556
$212
61
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
13 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Source: PitchBook *As of 6/30/2016
Even the median round in San Jose is still quite high San Jose MSA median & average VC round size ($M)
San Jose MSA median pre-money valuation ($M) by stage
$18
$100
Median
$16
$16.9
Average
Angel/Seed
$90 $13.7
$14
Early-stage VC $84.8
Late-stage VC
$80
$89.8
$70
$12
$60
$10
$50
$8
$7.0
$6
$30
$4.2
$4
$40 $28.5
$26.5
$20
$2
$10
$0
$9.1
$7.0
$0 2010
2011
2012
2013
2014
2015
2016*
2010
2011
2012
2013
2014
Source: PitchBook *As of 6/30/2016
Out of MSA
1,324
New Enterprise Associates
22
Formation 8
16
Lightspeed Venture Partners
15
AME Cloud Ventures
15
Andreessen Horowitz
14
500 Startups
14
447
Accel Partners
14
Intel Capital
13
1,464
1,114 880
848 611
99
120
123
137
143
119
60
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016.
San Jose MSA VC-backed exits (#) by type 140
Acquisition
IPO
2016*
2015’s most active investors by VC deals (#) in San Jose MSA
Investors (#) active by HQ in San Jose MSA In MSA
2015
Source: PitchBook *As of 6/30/2016
12
Sequoia Capital
Source: PitchBook
San Jose MSA VC-backed exit activity Exit value ($B)
Buyout
120
106
122
107 97
100 80
# of exits
100
95
Source: PitchBook *As of 6/30/2016
60
36
2010
2011
2012
2013
2014
2015
$4.7
$4.9
$33.4
$6.2
0
$6.8
20
$5.4
40
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
14 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2016*
Boston-Cambridge-Quincy MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Boston-Cambridge-Quincy
$80.9 billion
$41.2 billion
4
$30.7 billion
3,664
$28.7 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
Boston MSA VC activity
$10 $8
Deal value ($B)
# of deals closed
Angel/Seed
Early-stage VC
800
Late-stage VC
600
$6 400 $4
238 200
$2
89 81 68
$0 2010
2011
2012
2013
2014
2015
0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Behavioral Technologies
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Social/platform software
$5.0
95
Clean Energy Group, Launchpad Venture Group
B2C electronics
$0.6
97
Mass Challenge, IncWell, Bolt Innovation Group Source: PitchBook. *As of 6/30/2016
15 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Boston MSA by year of financing
20
17
2010
20
2011
22
2012
24
2013
20
2014
22
2015
2016*
Source: PitchBook *As of 6/30/2016
Late-stage valuations remain high Boston MSA median pre-money valuation ($M) by stage
In value, first financings are roughly on pace with 2015 Boston MSA first venture financings
$70 Angel/Seed
Early-stage VC
Late-stage VC
$60
231
$50.8
$50
# of deals closed
Deal value ($M) $60.6
244 222
237
183
$40
157 $30 $20
$17.0
$10
$14.3
78
$6.2
$511
2015
$1,071
2014
$662
2013
$630
2012
$642
2011
$777
2010
$881
$5.9
$0
2010
2011
2012
2013
2014
2015
2016*
2016*
Source: PitchBook *As of 6/30/2016
Source: PitchBook *As of 6/30/2016
Select accelerators, incubators, & universities in Boston MSA
The past 1.5 years exhibit distinct skewing Boston MSA median & average VC round size ($M) $14 Median
Average
$12.3
$12
$11.7
$10 $8 $6 $4
$3.2
$3.0
2015
2016*
$2 $0 2010
2011
2012
2013
2014
Source: PitchBook *As of 6/30/2016
16 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2015’s most active investors by VC deals (#) in Boston MSA
2010-2016* Boston MSA VC activity (#) by sector Commercial Services 290
588
Consumer Goods & Recreation Energy
113 84
Healthcare Services/Supplies/Systems IT Hardware
545
Media
141 1,235
Pharmaceuticals and Biotechnology Software
132 536
Other
Atlas Venture
23
Launchpad Venture Group
22
Converge Venture Partners
18
Polaris Partners
15
General Catalyst Partners
14
New Enterprise Associates
13
Accomplice VC
13 Source: PitchBook
Source: PitchBook *As of 6/30/2016
Boston MSA VC-backed exit activity 1H 2016 has seen quite a slump in outside interest Investors (#) active by year, HQ in Boston MSA In MSA
Exit value ($B)
# of exits 99
85
84
Out of MSA
80 66
882
65
904
32
792 613
$3.2
$8.0
$4.0
$2.6
$5.2
$3.4
$2.3
422
493
2010
2011
2012
2013
2014
2015
2016*
306 123
144
161
155
186
2010
2011
2012
2013
2014
183 2015
72
Source: PitchBook *As of 6/30/2016
2016*
Source: PitchBook *As of 6/30/2016
Boston MSA VC-backed exits (#) by type Boston-Cambridge-Quincy
Select statistics
120
Employment’
2.7 million
100
Change in employment’’
1.2%
Median two-bedroom apartment rent, Boston^
$2,950
Change in rent price, Boston*
0.3%
Office lease median rate, $ per square foot per year^
$50
Number of listings in the last 90 days^
196
Annual mean wage, computer & mathematical occupations**
$97,480
Change in pay, full-time private industry employees***
2.3%
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
Acquisition
IPO
Buyout
80
60
40
20
0 2010
2011
17 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Los Angeles-Long Beach-Santa Ana MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Los Angeles-Long Beach-Santa Ana
$26.1 billion
$2.7 billion
9
$21.3 billion
3,403
$11.2 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
LA MSA VC activity
$5 $4
Deal value ($B)
# of deals closed
Angel/Seed
Early-stage VC
800
Late-stage VC
600
$3 400 $2
269 149
$1
200
76 44
$0 2010
2011
2012
2013
2014
2015
0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Happier Camper
Recreational goods
$1.2
100
Scott Greenburg
Automation software
$3.5
98
Microsoft Accelerator
18 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
First financings are slowing LA MSA first venture financings
Select accelerators, incubators, & universities in LA MSA
Deal value ($M) 345
# of deals closed
308
288
275 202
138
$259
$343
$555
$521
$742
$862
$249
106
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
The disparity in size suggests lots of cautious capital LA MSA median & average VC round size ($M) $16 Median
$14.8
Average
$14
LA MSA median pre-money valuation ($M) by stage
$12
$80
$10
Angel/Seed
$75.0
Early-stage VC
$66.7
$70 Late-stage VC
$8.0
$8
$60
$6
$50
$4
$40
$2
$2.0
$2.2
2015
2016*
$0
$30 $21.7
$20 $10
2010
2011
2012
2013
2014
$18.0
$6.0
$6.7
2015
2016*
Source: PitchBook *As of 6/30/2016
$0 2010
2011
2012
2013
Los Angeles-Long Beach-Santa Ana
Select statistics
Employment’
6.0 million
Change in employment’’
2.7%
Median two-bedroom apartment rent, Los Angeles^
$2,630
Commercial Services
Change in rent price, Los Angeles*
3.3%
Consumer Goods & Recreation Energy
Office lease median rate, $ per square foot per year^
$40
Number of listings in the last 90 days^
1,182
Annual mean wage, computer & mathematical occupations**
$91,150
Change in pay, full-time private industry employees***
2.7%
2014
Source: PitchBook *As of 6/30/2016
2010-2016* LA MSA VC activity (#) by sector
701
377 224 65 330 63 352
1,189 102
Healthcare Services/Supplies/Systems IT Hardware Media Pharmaceuticals and Biotechnology Software Other
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
Source: PitchBook *As of 6/30/2016
19 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Los Angeles MSA by year of financing
26
20
2010
18
2011
12
2012
23
2013
16
2014
20
2015
2016*
Source: PitchBook *As of 6/30/2016
2015’s most active investors by VC deals (#) in Los Angeles MSA
Investors (#) active by HQ in Los Angeles MSA In MSA
Out of MSA
950
961
801 658 492 389
352
58
85
117
123
133
144
2010
2011
2012
2013
2014
2015
50 2016*
Source: PitchBook *As of 6/30/2016
# of exits
22
Tech Coast Angels
22
Upfront Ventures
18
Bam Ventures
15
Greycroft Partners
13
Third Wave Digital
12
Pasadena Angels
11
Frost Data Capital
11
Allen DeBevoise
11
Crosscut Ventures
11 Source: PitchBook
LA MSA VC-backed exits (#) by type
LA MSA VC-backed exit activity
Exit value ($B)
Wavemaker Partners
80
71
Acquisition
IPO
Buyout
70
52
60
49
48
50
34
34
40 30
$1.2
$1.6
$2.0
$1.3
$2.7
$1.3
$1.1
14
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
20 10 0 2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
20 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Seattle-Tacoma-Bellevue MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Seattle-Tacoma-Bellevue
$16.0 billion
$7.6 billion
0
$8.4 billion
1,717
$6.7 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
Seattle MSA VC activity $2,500 $2,000
Deal value ($M)
400
# of deals closed
Angel/Seed Late-stage VC
300
Early-stage VC $1,500 200 $1,000
121
$500
68
$0
22
100
31 2010
2011
2012
2013
2014
2015
0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Boatbound
Marine
$9.5
97
Atlas Venture, 500 Startups, BoxGroup
Energy transportation
$12.7
98
Maveron, Madrona Venture Group, Conversion Capital
21 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Seattle MSA by year of financing
16
14
2010
20
2011
20
2012
21
2013
15
2014
12
2015
2016*
Source: PitchBook *As of 6/30/2016
Seattle MSA median pre-money valuation ($M) by stage
Seattle MSA median & average VC round size ($M)
$60
$9
Early-stage VC
Late-stage VC
$54.0
$50
Median
$8
$46.6
Average
$7 $6.5
$6
$40
$5.0
$5
$30
$4
$18.7
$20
$21.0
$3 $2
$10
$1.9
$1.5
$1 $0
$0 2010
2011
2012
2013
2014
2015
2010
2011
2012
2013
2014
Unsurprisingly, software dominates Seattle 2010-2016* Seattle MSA VC activity (#) by sector
2015
2016*
Source: PitchBook *As of 6/30/2016
Source: PitchBook
Seattle-Tacoma-Bellevue
Select statistics
Employment’
1.95 million
Change in employment’’
3.6%
Median two-bedroom apartment rent, Seattle^
$2,250
Change in rent price, Seattle*
6.5%
Office lease median rate, $ per square foot per year^
$40
Number of listings in the last 90 days^
551
Annual mean wage, computer & mathematical occupations**
$107,290
Change in pay, full-time private industry employees***
3.4%
Commercial Services 314
188
Consumer Goods & Recreation Energy
49 23 160 53 81 109
740
Healthcare Services/Supplies/Systems IT Hardware Media Pharmaceuticals and Biotechnology Software Other Source: PitchBook *As of 6/30/2016
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
22 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Seattle MSA first venture financings Deal value ($M)
# of deals closed
134
2015’s most active investors by VC deals (#) in Seattle MSA 139
124
112 93 84
$147
$143
$316
$228
$190
$327
$86
54
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Alliance of Angels
23
Madrona Venture Group
14
Keiretsu Forum
12
Vulcan Capital
11
Rudy Gadre
8
WRF Capital
8
Gary Rubens
7
Founder's Co-Op
7
The W Fund
6
Voyager Capital
6
Trilogy Equity Partners
6 Source: PitchBook
Investors (#) active by year, HQ in Seattle MSA In MSA
Out of MSA
Select accelerators, incubators, & universities in Seattle MSA
430 379 223
395
260
157
155
42
48
53
70
56
64
37
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Seattle MSA VC-backed exits (#) by type 45
Acquisition
IPO
Buyout
40
Seattle MSA VC-backed exit activity Exit value ($B)
41
35
# of exits
39
30 25
33
20 15
28
27
10
22
5
$0.1
2012
$0.5
2011
$1.7
$1.6
2010
$1.2
$1.5
9
2013
2014
2015
2016*
0 2010
2011
2012
Source: PitchBook *As of 6/30/2016
23 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Washington, DC-Arlington-Alexandria MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Washington, DC-Arlington-Alexandria
$19.2 billion
$4.8 billion
2
$8.2 billion
1,416
$7.4 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
DC MSA VC activity
$2.5 $2.0
Deal value($B)
# of deals closed
Angel/Seed
Early-stage VC
Late-stage VC
350 300 250
$1.5
200 150
$1.0 102 $0.5
50 31 21
$0 2010
2011
2012
2013
2014
2015
100 50 0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
PitchBook growth rate percentile
Select active investors
Rooam
Financial services
$1.2
100
N/A
Hardware
$3.0
99
Irish Angels, Baltimore Angels, Blue Venture Investors, Middleburg Capital Development
24 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in DC MSA by year of financing
26
30
2010
12
2011
20
2012 (est.)
24
2013
21 19
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
DC is seeing 1st financings of considerable size in 1H DC MSA first venture financings Deal value ($M)
# of deals closed 136
$14 Median
Average
$12
116 103
DC MSA median & average VC round size ($M)
$10
107
$8
81
$5.9
$6
71
$6.4
$4 $2.5
2010
2011
2012
2013
2014
2015
$151
$223
$319
$109
$274
$302
$167
31
$2
$1.5
$0 2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
2016*
Source: PitchBook *As of 6/30/2016
Washington, DC-Arlington-Alexandria
Select statistics
Employment’
3.2 million
Change in employment’’
1.9%
Median two-bedroom apartment rent, Washington, DC^
$3,120
Change in rent price, Washington, DC*
3.6%
Office lease median rate, $ per square foot per year^
$33
$10
Number of listings in the last 90 days^
1,287
$5
Annual mean wage, computer & mathematical occupations**
$102,010
Change in pay, full-time private industry employees***
2.3%
DC MSA median pre-money valuation ($M) by stage $45 $40 $35
$32.8
$30
$29.3
$25
Early-stage VC
$20
Late-stage VC $16.2
$15
$14.5
$0 2010
2011
2012
2013
2014
2015
Source: PitchBook
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
25 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Select accelerators, incubators, & universities in DC MSA
2015’s most active investors by VC deals (#) in DC MSA Blu Venture Investors
10
Center for Innovative Technology Gap Funds
7
New Enterprise Associates
6
Grotech Ventures
4
NextGen Venture Partners
4
Baltimore Angels
4 4
Hammerstone Capital
Source: PitchBook
Outside investment peaked in 2014 Investors (#) active by HQ in DC MSA In MSA
2010-2016* DC MSA VC activity (#) by sector
Out of MSA
Commercial Services 161
223
Consumer Goods & Recreation Energy
47 33
359 223
240
252
143
Healthcare Services/Supplies/Systems IT Hardware
42
Media
66
174 130
128 24
39
46
52
54
2010
2011
2012
2013
2014
45
28
2015
2016*
614
87
Pharmaceuticals and Biotechnology Software Other Source: PitchBook *As of 6/30/2016
Source: PitchBook *As of 6/30/2016
Strategic buyers led to last year’s surge DC MSA VC-backed exits (#) by type
DC MSA VC-backed exit activity Exit value ($B)
# of exits
45
39
Buyout
2013
2014
30 25
22 18
20
$0.5
$0.7
$2.9
$1.2
$1.8
8
2010
IPO
Source: PitchBook *As of 6/30/2016
35
31 27
26
Acquisition
40
2011
2012
2013
2014
2015
15 10 5
2016*
Source: PitchBook *As of 6/30/2016
0 2010
2011
2012
26 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2015
2016*
Austin-Round Rock MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Austin-Round Rock
$3.4 billion
$1.9 billion
0
$6.6 billion
1,376
$3.7 billion Source: PitchBook *As of 6/30/2016
Austin MSA VC activity $1,500
Deal value ($M) Angel/Seed
Select accelerators, incubators, & universities in Austin MSA
300
# of deals closed
250
Late-stage VC $1,000
200
Early-stage VC
150 $500
$0 2010
2011
2012
2013
2014
2015
95
100
49 27
50
19
0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Real estate services
$20.1
99
Altos Ventures, Silverton Partners
27 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Austin-Round Rock
Select statistics
Employment’
994,000
Change in employment’’
3.9%
Median two-bedroom apartment rent, Austin^
$1,500
Change in rent price, Austin*
3.6%
Office lease median rate, $ per square foot per year^
$30
Number of listings in the last 90 days^
430
Annual mean wage, computer & mathematical occupations**
$84,660
Change in pay, full-time private industry employees***
2.7%
Select local Fortune 500 companies
After an elevated plateau, Austin sees a slowdown Austin MSA first venture financings # of deals closed
Deal value ($M) 117
110 109
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016, Dallas
78 68 56
Austin MSA median & average VC round size ($M) 33
$8
2011
2012
2013
2014
2015
$45
2010
$324
$211
$5.3
$5
$120
$6.1
$6
$482
$7
$140
Average
$152
Median
2016*
Source: PitchBook *As of 6/30/2016
$4 $3 $2
$1.7
$2.0
$1
Austin boasts considerable diversity 2010-2016* Austin MSA VC activity (#) by sector
$0 2010
2011
2012
2013
2014
2015
Commercial Services
2016*
Source: PitchBook *As of 6/30/2016
141 50
347
Interestingly, late-stage numbers have trended downward in Austin for some time Austin MSA median pre-money valuation ($M) by stage
Consumer Goods & Recreation Energy
39 127 53
51 39
$35 $30
529
$27.5
Healthcare Services/Supplies/Systems IT Hardware Media Pharmaceuticals and Biotechnology Software Other
$25 Early-stage VC
Late-stage VC
$22.9
$20
$14.5
$15 $10 $9.1 $5 $0 2010
2011
2012
2013
2014
2015
Source: PitchBook
28 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Source: PitchBook *As of 6/30/2016
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Austin MSA by year of financing
14
15
2010
34
2011
23
2012
17
2013
15
2014
15
2015
2016*
Source: PitchBook *As of 6/30/2016
Outside investment soared between 2014 and 2015 Investors (#) active by HQ in Austin MSA In MSA
Out of MSA
396
370
276 195 129
135
24
33
33
37
40
39
2010
2011
2012
2013
2014
2015
100 14 2016*
Source: PitchBook *As of 6/30/2016
2015’s most active investors by VC deals (#) in Austin MSA Central Texas Angel Network
29
Capital Factory
15
Houston Angel Network
11
Silverton Partners
10
Wild Basin Investments
9
ATX Seed Ventures
8
Sante Ventures
6
S3 Ventures
5
Austin Ventures
5
UT Horizon Fund
5
LiveOak Venture Partners
5
Geekdom Fund
5 Source: PitchBook
Exits have been relatively healthy in 2016 so far Austin MSA VC-backed exit activity Exit value ($M)
Austin MSA VC-backed exits (#) by type 30
# of exits 24
22 19
19
19
Acquisition
IPO
Buyout
2012
2013
2014
25
20
19
10
15
$859
$622
$470
$664
$254
$530
$290
10
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
5
0 2010
2011
2015
2016*
Source: PitchBook *As of 6/30/2016
29 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Chicago-Naperville-Joliet MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Chicago-Naperville-Joliet
$11.7 billion
$3.4 billion
4
$8.3 billion
1,348
$9.95 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
Chicago MSA VC activity
$2.5
Early-stage VC
Angel/Seed
Late-stage VC
300 250
$2.0 Deal value ($B) $1.5
# of deals closed
$1.0
200
115 70
$0.5
27 18
$0.0 2010
2011
2012
2013
2014
2015
150 100 50 0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
RxBar
Food products
$0.8
95
N/A
Open Airplane
Platform software
$0.6
99
The Bunker Incubator
30 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
1st financings stayed remarkably steady since 2012 Chicago MSA first venture financings Deal value ($M) 115
# of deals closed 124 111
Chicago MSA median & average VC round size ($M) $16 Average
119
$14 Median $12 $10
84
$8
62
45
$7.2
$6.5
$6 $4
$1.8
$2 $1.5
$113
$303
$226
$98
$268
$166
$74
$0
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
2010
2011
2012
2013
Commercial Services 191
Late-stage VC
81
$70
21
$60
119
$47.5
$50
21 57
$40 $30
$28.9
48
526
$10
Consumer Goods & Recreation Energy Healthcare Services/Supplies/Systems IT Hardware Media Pharmaceuticals and Biotechnology Software Other
$20 $12.7
2016*
2010-2016* Chicago MSA VC activity (#) by sector
284 Early-stage VC
2015
Source: PitchBook *As of 6/30/2016
Chicago MSA median pre-money valuation ($M) by stage $80
2014
$12.2 Source: PitchBook *As of 6/30/2016
$0 2010
2011
2012
2013
2014
2015
Source: PitchBook
Select accelerators, incubators, & universities in Chicago MSA
Chicago-Napierville-Joliet
Select statistics
Employment’
4.7 million
Change in employment’’
1.3%
Median two-bedroom apartment rent, Chicago^
$1,800
Change in rent price, Chicago*
-1.2%
Office lease median rate, $ per square foot per year^
$37
Number of listings in the last 90 days^
679
Annual mean wage, computer & mathematical occupations**
$83,250
Change in pay, full-time private industry employees***
2.3%
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
31 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Chicago MSA by year of financing
38
13
2010
50
2011
23
2012
22
2013
22
2014
17
2015
2016*
Source: PitchBook *As of 6/30/2016
2015’s most active investors by VC deals (#) in Chicago MSA
Investors (#) active by HQ in Chicago MSA In MSA
Out of MSA
403
209
228
130 44
58
2010
2011
2012
62 2013
14
Hyde Park Angels
11
Chicago Ventures
9
Jumpstart Ventures
8
KGC Capital
7
OCA Ventures
6
Tribal Ventures
6
270
263
106 34
Pritzker Group Venture Capital
73 2014
68 2015
45
6
Hyde Park Venture Partners
Source: PitchBook
2016*
Source: PitchBook *As of 6/30/2016
Chicago MSA VC-backed exits (#) by type
A few huge deals skewed 2015 numbers Chicago MSA VC-backed exit activity Exit value ($B)
30 IPO
Buyout
2012
2013
2014
25
26
# of exits
Acquisition
21
20
18
18
15
14
12 10
11
$1.2
$1.1
$1.6
$0.7
$4.3
2010
2011
2012
2013
2014
2015
$0.4
$0.7
5
2016*
0 2010
2011
Source: PitchBook *As of 6/30/2016
32 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2015
2016*
Source: PitchBook *As of 6/30/2016
San Diego-Carlsbad-San Marcos MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
San Diego-Carlsbad-San Marcos
$4.8 billion
$1.5 billion
2
$9.4 billion
1,317
$8.7 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
San Diego MSA VC activity
$2.0
$1.5
Deal value ($M)
# of deals closed
Angel/Seed
300
Early-stage VC
250
Late-stage VC
200
$1.0
150 100
$0.5
56 24 20
$0.0 2010
2011
2012
2013
2014
2015
100 50 0
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
BioNano Genomics
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Electronic equipment
$10.5
100
Apsara Capital, Alpina Partners, Sandbox Industries
Healthcare discovery tools
$108.9
95
Legend Capital, Domain Associates
33 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Last year saw a boom in first-time financings for SD San Diego MSA first venture financings
San Diego MSA median & average VC round size ($M) $12
Deal value ($M)
Median
# of deals closed
108
115
Average
$10
$9.4 $7.9
$8
90
$6
70 67
Source: PitchBook *As of 6/30/2016
$4
55
39
$2
$2.0
$2.0
2015
2016*
$182
$190
$157
$222
$284
$394
$146
$0
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
2010
2011
2012
2013
2014
2010-2016* San Diego MSA VC activity (#) by sector
Commercial Services 75
San Diego MSA median pre-money valuation ($M) by stage
36
264
Consumer Goods & Recreation Energy
41
$60 Early-stage VC
213
Healthcare Services/Supplies/Systems IT Hardware
53 23
Media
$54.3
Late-stage VC
$49.3
$50
330
$40
282
$30
Pharmaceuticals and Biotechnology Software Other
$20
Source: PitchBook *As of 6/30/2016
$14.3 $10
$10.6
$0 2010
2011
2012
2013
2014
2015
Source: PitchBook *As of 6/30/2016
Select accelerators, incubators, & universities in San Diego MSA
San Diego-Carlsbad-San Marcos
Select statistics
Employment’
1.4 million
Change in employment’’
2.3%
Median two-bedroom apartment rent, San Diego^
$2,020
Change in rent price, San Diego*
3.0%
Office lease median rate, $ per square foot per year^
$36
Number of listings in the last 90 days^
846
Annual mean wage, computer & mathematical occupations**
$92,460
Change in pay, full-time private industry employees***
3.1%
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
34 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in San Diego MSA by year of financing
21
11
2010
45
2011
19
2012 (est.)
21
2013
12
2014
12
2015
2016*
Source: PitchBook *As of 6/30/2016
In the past year and a half, outside investment has slid Investors (#) active by HQ in San Diego MSA In MSA
Out of MSA
329
196
265
232
229 183
90 21 2010
19
27
30
30
24
15
2011
2012
2013
2014
2015
2016*
2015’s most active investors by VC deals (#) in Austin MSA Biobrit
10
Tech Coast Angels
8
Avalon Ventures
7
ARCH Venture Partners
4
Crosslink Capital
4
Vertical Venture Partners
4
Keshif Ventures
4
Correlation Ventures
4 4
Versant Ventures
Source: PitchBook
Source: PitchBook *As of 6/30/2016
San Diego MSA VC-backed exits (#) by type 35
San Diego MSA VC-backed exit activity
Acquisition
IPO
Buyout
2012
2013
2014
30
Exit value ($B)
# of exits 29
28
25
26 20
22 17
15
16 10
$1.0
$0.8
$1.2
$1.9
$2.5
$1.2
5
2010
2011
2012
2013
2014
2015
0 2010
2011
Source: PitchBook
35 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2015
2016*
Source: PitchBook *As of 6/30/2016
Philadelphia-Camden-Wilmington MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Philadelphia-Camden-Wilmington
$7.1 billion
$3.0 billion
0
$4.8 billion
1,003
$5.4 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
Philadelphia MSA VC activity
$1.2 $1.0
200
Angel/Seed
Deal value ($M) Early-stage VC Late-stage VC
$0.8
150 # of deals closed
$0.6
91
$0.4
47 30 14
$0.2
100
50
0
$0 2010
2011
2012
2013
2014
2015
2016* Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
ChargeItSpot
B2C electronics
$4.7
100
Start Capital, Wharton Venture Initiation Program
B2C electronics
$0.9
100
Ben Franklin Technology Partners, Investors’ Circle, DreamIt Ventures
36 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Philadelphia MSA by year of financing
25
16
2010
11
2011
14
2012 (est.)
23
2013
15
2014
12
2015
2016*
Source: PitchBook *As of 6/30/2016
2016 is unlikely to match last year’s peak Philadelphia MSA first venture financings
Round sizes are regressing to the mean Philadelphia MSA median & average VC round size ($M) $8
# of deals closed
86
Median
89
80
$6
$6.1
$5.3
$5
60
$4
59
$3
Deal value ($M)
41
Average
$7
29
$2 $1
$1.0
$1.1
2015
2016*
$104
$114
$52
$482
$333
2010
2011
2012
2013
2014
2015
2010
2011
2012
2013
2014
$41
$62
$0 Source: PitchBook *As of 6/30/2016
2016*
Source: PitchBook *As of 6/30/2016
Philadelphia MSA median pre-money valuation ($M) by stage
Philadelphia-Camden-Wilmington
Select statistics
Employment’
2.9 million
Change in employment’’
2.1%
Median two-bedroom apartment rent, Philadelphia^
$1,580
Change in rent price, Philadelphia*
2.0%
Office lease median rate, $ per square foot per year^
$30
Number of listings in the last 90 days^
297
Annual mean wage, computer & mathematical occupations**
$86,620
Change in pay, full-time private industry employees***
1.5%
$60 Early-stage VC
Late-stage VC
$50
$47.7
$40 $30 $19.7
$20 $10
$25.1
$10.0
$0 2010
2011
2012
2013
2014
2015
Source: PitchBook *As of 6/30/2016
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
37 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Philadelphia MSA VC activity (#) by sector
Select accelerators, incubators, & universities in Philadelphia MSA
Commercial Services 109
182
Consumer Goods & Recreation Energy
19 27
Healthcare Services/Supplies/Systems IT Hardware
196
Media 298
Pharmaceuticals and Biotechnology Software
10 33 129
2015’s most active investors by VC deals (#) in Philadelphia MSA
Other Source: PitchBook *As of 6/30/2016
Philly is actually on pace to see even more outside investment interest in 2016 Investors (#) active by HQ in Philadelphia MSA In MSA
Out of MSA
Ben Franklin Technology Partners of Southeastern Pennsylvania
33
Robin Hood Ventures
12
DreamIt Ventures
9
Osage Partners
5
Investors' Circle
5
Keiretsu Forum
4
Safeguard Scientifics
4
Wharton Venture Initiation Program
3 Source: PitchBook
179 126 103
157
136
129
82
M&A helped bump exit totals considerably last year Philadelphia MSA VC-backed exits (#) by type 30
25
31
22
24
29
30
19
2010
2011
2012
2013
2014
2015
2016*
Acquisition
IPO
Buyout
2012
2013
2014
25
Source: PitchBook *As of 6/30/2016
20
Philadelphia MSA VC-backed exit activity
Exit value ($B)
15
# of exits
10
24 5
17 14
18
17 0
15
2010
2011
2015
2016*
$0.8
$0.7
$0.4
$0.6
$1.1
$1.9
Source: PitchBook *As of 6/30/2016
2010
2011
2012
2013
2014
2015
Source: PitchBook
38 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Atlanta-Sandy Springs-Marietta MSA
Total investor AUM
Total VC funds raised since 2006
# of current unicorns
Total VC invested since 2010
Total # of VC rounds since 2010
Total exit value since 2010
Atlanta-Sandy Springs-Marietta
$6.1 billion
$1.15 billion
1
$5.0 billion
837
$7.8 billion Source: PitchBook *As of 6/30/2016
Select local Fortune 500 companies
Select accelerators, incubators, & universities in Atlanta MSA
Atlanta MSA VC activity
$2.0
200
# of deals closed
Angel/Seed Late-stage VC
$1.5
150
Early-stage VC Deal value ($B)
100
$1.0 54
$0.5
29 16 9
$0 2010
2011
2012
2013
2014
2015
50
0
2016* Source: PitchBook *As of 6/30/2016
39 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
M E D I A N E M P LOY E E CO U N T Median employee # at startups in Atlanta MSA by year of financing
20
15
2010
23
2011
43
2012 (est.)
36
2013 (est.)
19
2014
28
2015
2016*
Source: PitchBook *As of 6/30/2016
Since 2014, first-time startups have had diminishing luck in attracting VC Atlanta MSA first venture financings
2015 experienced a serious spread in round sizes Atlanta MSA median & average VC round size ($M) $16 Median
Deal value ($M) # of deals closed 66
Average
$14
80
$13.4
$12
67
$10
63
$8.7
$8
50
$6 $4
40
$2
$68
$45
$155
$318
$87
$181
$47
15
2010
2011
2012
2013
2014
2015
2016*
$2.5
$2.3
2015
2016*
$0 2010
2011
2012
2013
2014
Source: PitchBook *As of 6/30/2016
Source: PitchBook *As of 6/30/2016
Atlanta-Sandy Springs-Marietta
Select statistics
Employment’
2.7 million
Atlanta MSA VC activity (#) by sector
Commercial Services
Change in employment’’
3.0%
Median two-bedroom apartment rent, Atlanta^
$1,650
Change in rent price, Atlanta*
4.6%
Office lease median rate, $ per square foot per year^
$36
Number of listings in the last 90 days^
448
Annual mean wage, computer & mathematical occupations**
$83,580
Change in pay, full-time private industry employees***
2.4%
142
121 30 6 116
Consumer Goods & Recreation Energy Healthcare Services/Supplies/Systems IT Hardware Media
26
337 18
Sources: ApartmentList, BLS, PayScale, 42Floors *July 2015-July 2016, **May 2015, ^July 2016 ‘May 2016, ‘‘May 2015-May 2016, ***2Q 2016
40 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
41
Pharmaceuticals and Biotechnology Software Other Source: PitchBook *As of 6/30/2016
Select high-growth startup
Sector
Total VC raised to date ($M)
Growth rate percentile
Select active investors
Allconnect
Real estate services
$80.1
95
New Cycle Capital, Escalate Capital Partners, Maveron
Network mgmt software
$122.5
100
Google Capital, GV, Andreessen Horowitz
Atlanta has attracted a steady stream of outside investors over the past few years Investors (#) active by HQ in Atlanta MSA In MSA
BIP Capital
8
Mosley Ventures
7
Advanced Technology Development Center
5
Thomas Noonan
5
Southeast Investor Group
5
Atlanta Technology Angels
4
TechOperators
4
59
BLH Venture Partners
4
15
UPS Strategic Enterprise Fund
4
GV
3
Webb Investment Network
3
Tech Square Venture Partners
3
Alerion Ventures
3
Hallett Capital
3
Out of MSA
138 86
2015’s most active investors by VC deals (#) in Atlanta MSA
149
168
199
99
20
22
32
27
31
28
2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Exits are down from a 2014 high Atlanta MSA VC-backed exit activity 17 15
16
Source: PitchBook
17
Atlanta MSA VC-backed exits (#) by type # of exits 18
12
Exit value ($B)
Acquisition
IPO
Buyout
16
9
14
5
12
$1.9
$0.8
$1.1
$0.3
$2.5
$0.9
$0.4
10 8
2010
2011
2012
2013
2014
2015
2016*
6
Source: PitchBook *As of 6/30/2016
4 2 0 2010
2011
2012
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
41 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
Sample use cases First financings/overall deal activity by select MSA
0.60
Atlanta MSA
Chicago MSA
Los Angeles MSA
New York MSA
Washington, DC MSA
0.58 0.56 0.54 0.52 0.50 0.48 0.46 0.44 0.42 0.40 2009
2010
2011
2012
2013
2014
2015
2016* Source: PitchBook *As of 6/30/2016
The differences between the MSAs covered in this report could lead one to suppose that comparing and contrasting would be foolhardy. But as long as we employ similar metrics and bear in mind that any comparisons are rough approximations, not completely factual, then it can be useful to analyze certain MSAs. For example, to produce the chart above, we calculated the ratio of first venture financings of local startups to overall venture financing by year, thereby normalizing the figures. Then we removed the seven MSAs that had either highly variable or sub-0.40 ratios of first-time financings to overall VC activity. As we already cautioned, we cannot draw conclusions with a high degree of confidence from this data. But we can certainly use them to inform what
we already know as well as reinforce existing hypotheses. The fact that every single MSA saw a sharp spike in that ratio in 2012 correlates strongly with the first significant stirrings of the venture boom of the past few years. Investors both domestic and foreign began funding fledgling businesses across such MSAs as Atlanta or Washington, DC—which may not normally be thought of as hotbeds of venture capital—at a rate that produced a significant uptick in the numerator of that ratio. Increases in capital committed to smaller funds as well as the development of angel syndicates and dedicated seed-stage firms doubtless contributed. Since we’ve seen that venture activity across every MSA in this report was quite healthy in 2012, which leads to the conclusion that it was first-
time financings that rose. This is an explanation after the fact, but the same analysis of more recent data suggests VC in LA, NY and ATL MSAs is flowing more across all financing stages, while first-time VC fundings have also slid. These are just a few of the conclusions that can be drawn from these datasets. Delving deeper into the data, there are plenty more heuristics to generate. A recent PitchBook piece examining multiples on invested capital (MOIC) by US city illustrates one such way, but to remain focused on contextualizing our existing, broader knowledge of VC trends with specific datasets in this report, let’s examine how median financing sizes and employee counts are correlated. To keep things simple, we’ve broken out median employee
42 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
count by year over median financing size below by select top MSAs. As this ratio declined in recent years, it’s clear that the typical financing within a given MSA grew larger in size or employee counts dwindled; in light of national venture trends, with median valuations & financing sizes rising by and large over the past few years, it’s more reasonable to suppose that the former was the case. Looking at this aggregation and certain MSAspecific statistics from above is also instructive. Chicago MSA employee counts were skewed considerably in 2010 and 2012, with a median of 38 and 50, respectively, even though its median financing hovered around $1 million in size. This disparity suggests that in those years there existed a population of mature Chicagobased companies, already boasting a considerable roster of employees,
that received venture financing. At the same time, most startups garnering VC backing in the Chicago MSA during those years were still pulling in smaller sums—they still are, as a matter of fact, with the median financing in 1H 2016 at $1.8 million. We must also bear in mind that living costs, which certainly factor into startup run rates when it comes to matters of payroll, also tend to be lower in Chicago MSA than, say, San Francisco. In addition, the fact that certain key costs for starting up a business have plummeted over the past several years, given the rise in outsourcing or crowdsourcing basic duties and infrastructure.
many avenues of analysis, whether on your own or in subsequent installments of this US Venture Ecosystem series. On the next page we sketch out various other comparisons between select regional numbers, along with commentary, to further enrich your lines of reasoning.
The number of variables and their interactions that must be considered are complex, but as mentioned previously, these datasets will hopefully serve as a starting point for
Median employee count/median financing size by select MSA
60.0 Atlanta MSA
Austin MSA
Chicago MSA
Los Angeles MSA
New York MSA
Seattle MSA
50.0
40.0
30.0 Source: PitchBook
20.0
10.0
0.0 2010
2011
2012
2013
2014
43 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K
2015
2016*
New York media has typically outpaced LA in drawing interest from investors VC activity (#) in media LA MSA media
NY MSA media
Interestingly, of all MSAs that have over 1,000 total late-stage rounds since 2010, Boston has the most equitable breakdown between stages by count Boston MSA VC activity (#) by stage 100% 90% 80%
104
94
94
70%
97
60%
85
50%
61
40%
66 38 2010
66
46
36 57
20%
56 23
2011
2012
2013
2014
2015
30%
2016*
10% 0% 2010 2011 Late-stage VC
Source: PitchBook *As of 6/30/2016
When it comes to a research-intensive, often expensive field such as pharma & biotech, the confluence of traditional VC and a nexus of vaunted research universities is hard to beat Pharma & biotech VC activity breakdown Boston MSA
San Diego MSA
41
21
96
15
16
19
52
59
74
2010
39
70
2011
34
70
2012
Los Angeles has a whopping 6.9x disparity between its average and median VC financing sizes for the first half of the year Spread between avg. & median round sizes by MSA Average financing size/median financing size in 1H 2016
Atlanta
3.9
Austin
3.0
Boston
3.9
Chicago
4.0
Los Angeles
6.9
New York
3.2
Philadelphia
4.8
San Diego
4.7
San Francisco
4.6
San Jose
2.4
Seattle
2.7
Washington, DC
2.6
89 89 56 43
49
2015 2016* Angel/Seed Source: PitchBook *As of 6/30/2016
MSA
19
San Francisco MSA
14
Seattle MSA
2012 2013 2014 Early-stage VC
5
41
75
36 93
111
20 43
2013
2014
2015
2016*
Source: PitchBook *As of 6/30/2016
Source: PitchBook
44 P I TC H B O O K 201 6 U S V E N T U R E E CO S YS T E M : FAC T B O O K