2019 CAPITAL ACTIVITY highlights
2019 DOMESTICALLY IN BRIEF
Entrepreneurs are the lifeblood of the U.S. economy and 2019 saw significant investments into early-stage companies.
The National Venture Capital Association reported $133.4B was raised across 10,700+ deals in 2019. Angel & Seed stage rounds recorded $9.1B invested across 4,500+ deals, flat from 2018. Early-stage VC registered over $42B invested across 3,600+ deals, slightly lower than 2018. Notably, early-stage mega-deals (over $100mm in size) saw 53 deals raise $9.7B.
While the number of late-stage VC deals hit an all-time high at nearly 2,600, capital invested saw a slight decline to $85B. Additionally, 882 VC exits set a colossal $256B record.
U.S. venture funds raised over $48B as participation from nontraditional investors such as hedge funds and mutual funds continued to grow while corporate VCs initiated 21 new CVC funds.
EMERGING TECHNOLOGY HIGHLIGHTS
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Fintech
Blockchain
Artificial Intelligence
Healthtech
Proptech
Internet of Things (IoT)
Cleantech
TOTAL VENTURE CAPITAL INVESTMENT
DEAL VALUE ($B)
DEAL COUNT
Source: NVCA 2020 Yearbook, Data Provided by PitchBook
domestic vc deals by stage
2018
2019
Source: NVCA 2020 Yearbook, Data Provided by PitchBook
DOMESTIC VENTURE CAPITAL ENTITIES
Source: NVCA 2020 Yearbook, Data Provided by PitchBook
global emergent technology investment
Sources: CB Insights Annual Report 2020; KPMG Pulse of Fintech H22019; SVB 2020 Annual Report Healthcare Investments & Exits; CREtech; Pitchbook, Emerging Tech Research: Internet Of Things; Bloomberg NEF Clean Energy Investment trends 2019
MEDIAN DEAL SIZE
Global early stage median deal size continued to increase with Series B funding seeing a jump of 15% to $18.3B
Series C median funding remained relatively flat YoY while Series D+ jumped 14% marking a third year in a row of double digit increases.
Source: Venture Pulse, Q4’19, Global Analysis of Venture Funding, KPMG Private Enterprise. Data provided by Pitchbook 1/15/20
VENTURE FUNDRAISING
Globally, 458 venture funds closed on over $76B in new capital in 2019, significantly lower than last year’s record shattering dollar take and the lowest count since 2013.
Although domestically 2019 recorded an impressive $48.4B in new dollars committed over 283 funds, both figures represent a marked decrease from last year’s numbers.
Source: Venture Pulse, Q4’19, Global Analysis of Venture Funding, KPMG Private Enterprise. Data provided by Pitchbook 1/15/20
Fintech
2019 Capital raising activity
$34.5 Billion
Funding in the fintech space posted another solid year in 2019, with later-stage deals hitting a five-year record, including 83 rounds raising over $100mm. Capital raising slowed down in Asia after 2018’s record setting year while emerging markets issuance grew YoY. Insuretech funding totaled over $6B and challenger banks raised more money than in any prior year as digital banking continued to develop globally. Capital markets incumbents with outdated tech stacks are ripe for disruption and startups with robust technology offerings are taking middle office market share by delivering significantly improved solutions.
Total: CB Insights Annual Report 2020 | Highlights: Crunchbase 3/2019
2019 HIGHLIGHTS
blockchain and distributed ledger technology (dlt)
2019 Capital raising activity
$4.1 Billion
February 2020’s release of JP Morgan’s Perspectives report points to payments, trade finance, and custodial services as the most obvious use cases for blockchain technology. Some of the highest-profile blockchain raises in 2019 were indeed in Fintech with Figure raising $225m while also securing $1B in debt financing and Ripple raising $200mm respectively. There was also renewed interest in cryptocurrency, as Kraken’s $100mm Series C round highlights. However, the bottom line remains the same for DLT technologies; the main obstacle to mainstream adoption remains the need for verification of the information going into each blockchain.
Totals: KPMG Pulse of Fintech H2 2019 | Highlights: Crunchbase 3/2019
2019 HIGHLIGHTS
artificial intelligence
2019 Capital raising activity
$26.6 Billion
According to CB Insights, AI companies raised $26.6B in 2019 compared to $22.1B in 2018. AI touches every sector and industry, with the most investment flowing into healthcare followed by finance. We count 38 deals that raised over $100mm, with early-stage and Series A deals dominating the share of investment. Corporate investment was robust as well with ArgoAI raising $2.6B from the Volkswagen Group and OpenAI raising $1B from Microsoft. The United States and China accounted for over 75% of capital raised followed by the UK, Israel and Canada.
Total: CB Insights Annual Report 2020 | Highlights: Crunchbase 3/2019
2019 HIGHLIGHTS
Healthtech
2019 Capital raising activity
$7.5 Billion
After a record-setting 2018, digital health investing continued to draw significant venture capital and sustained its march as the fastest growing healthcare sector. Of the $7.6B raised across 659 deals, late-stage VC attracted the lion’s share of the pie while the average valuation per transaction dipped from last year to just under $74mm. Telemedicine, Analytics, and mHealth Apps raised the most funding and we count over 25 companies having raised $100mm or more.
Total: SVB ‘20 Annual Report Healthcare Investments & Exits | Highlights: Crunchbase 3/2019
2019 HIGHLIGHTS
proptech & real ESTATE tech
2019 Capital raising activity
$24.9 Billion
The proptech space saw early-stage financing across all major continents with significant capital raises in Chile, Spain, Indonesia and Australia. Open Door’s $300mm Series B was a standout, and The We Company raised $1b in a series H round, including two massive Debt financings. As urban populations continue to grow, the melding of proptech technologies and IoT are giving rise to smart cities – urban areas where emerging technologies improve the everyday lives of citizens.
Total: CREtech data | Highlights: Crunchbase 3/2019
2019 HIGHLIGHTS
internet of things (iOT)
2019 Capital raising activity
$7.5 Billion
According to Pitchbook, VC investments in IoT declined 16% YoY in 2019, but there were at least six mega-raises totaling over $100mm including Samsara’s $300mm Series F, Terminus Technologies $285mm Series C and Punch Bowl Social’s hefty corporate round of $140mm. Corporate adoption of IoT technologies remains at least above 80% by industry according to Microsoft’s highly lauded IoT Signals report, with 88% of adopters crediting IoT as critical to their company’s success. Analyst firm Gartner expects the number of internet-connected devices to hit 5.8 billion in 2020, with growth set to continue at a rate of 20% year-on-year.
Total: Pitchbook, Emerging Tech Research: Internet of Things | Highilghts: Crunchbase 3/2019
2019 HIGHLIGHTS
CLEANTECH
2019 Capital raising activity
$10.5 Billion
Venture capital & Private Equity investment in Cleantech was up 6% YoY, reaching levels unseen in close to ten years. We count 11 deals totaling over $100m with two deals raising over $1B. By our estimates, Asia raised slightly more capital than North America with China’s T3 Mobile Travel Services topping the table at $1.5B. Historically, renewables, wind and solar make up most of the investment in cleantech, but energy storage and autonomous driving technologies promise capture a larger share of investment in 2020 and beyond.
Total: Bloomberg NEF Clean Energy Investment Trends, 2019 | Highlights: Crunchbase 3/2019