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Silicon Valley Venture Capital Survey – Fourth Quarter 2019

First Look
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Download the first look.

Background

We analyzed the terms of 188 venture financings closed in the fourth quarter of 2019 by companies headquartered in Silicon Valley. The quarter recorded the highest average and median price increases in the 16-year history of our survey.

Key Findings

Valuation Results Spike in Q4 2019

  • Up rounds exceeded down rounds 84% to 5%, with 11% flat in Q4 2019, an increase from Q3 2019 when up rounds exceeded down rounds 81% to 7%, with 12% flat.
  • The Fenwick & West Venture Capital Barometer™ showed an average price increase in Q4 2019 of 142% — an increase from the 88% recorded in the prior quarter — and the highest average price increase in a quarter since we began calculating valuation metrics in 2004.
  • The median price increase of financings rose sharply from 54% in Q3 2019 to 76% in Q4 2019. This was also the highest median price increase in a quarter since we began calculating valuation metrics in 2004.

Series D Financings Valuations Considerably Stronger

  • In a reversal of the prior two quarters, Series D financing rounds recorded considerably stronger valuation results compared to the prior quarter. Series B and E financing rounds were also stronger compared to the prior quarter.

Software and Internet/Digital Media Industries Continue Showing Strongest Valuations

  • The software and internet/digital media industries recorded the strongest valuation results in Q4, and the valuation results of both industries were markedly stronger compared to the prior quarter.
  • The hardware industry recorded more moderate improvements in valuation results compared to the prior quarter, while the valuation results for the life sciences industry in Q4 lagged those for the other industries.

Additional Findings

  • The percentage of financings in the quarter providing for redemption at the option of the investors increased to 11%, the highest percentage since Q3 2015.
  • The percentage of financings with cumulative dividends in the quarter was the lowest since Q4 2017.

Download the first look covering top-line trends for venture capital financings of Silicon Valley companies in Q4.


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