Venture Capital Investments in US hit $100 Billion in 2018

Venture Capital Investments hit $100 Billion in US alone! So many new unicorns valued at $1 billion-plus, countless $100 million venture financings, an explosion of giant funds — it’s no surprise that Venture Capital Investments hit $100 Billion in 2018 and now 2019 which is shaping up to be banner years for venture capital.

The year of 2018 saw a total of $254 billion invested globally into 18,000 startups via venture capital financing—a 46% leap from 2017’s figures—with 52% ($131 billion) landing in the US alone.

2019 figures are still coming to light, but initial reports show that 2018’s pace has surpassed to an extent. In terms of the global distribution of startup success, the number of private unicorns has grown from an initial list of 82 in 2015, to 356 in Q2 2019. In this time, the geographic composition has also widened, despite the USA and China still being home to over 75% of them.

There are more than 2.5 months remaining in 2018 and already U.S. companies have raised $84.1 billion — more than all of 2017 — across 6,583 VC deals as of Sept. 30, 2018, according to data from PitchBook’s 3Q Venture Monitor.

Last year, companies raised $82 billion across more than 9,000 deals in what was similarly an impressive year for the industry. Many questioned whether the trend would — or could — continue this year, and oh, boy has it. Venture Capital investments hit $100 Billion in 2018 alone and has sprinted past decade-highs and shows no signs of slowing down in 2019.

Why did Venture Capital Investments in US hit $100 Billion dollars? Fewer companies are raising money, but round sizes are swelling. Unicorns, for example, were responsible for about 25 percent of the capital dispersed in 2018. Those companies, which include Slack, Stripe and Lyft, have raised $19.2 billion so far this year — a record amount — up from $17.4 billion in 2017. There were 39 deals for unicorn companies valuing $7.96 billion in the third quarter of 2018 alone.

Some other interesting takeaways from PitchBook’s report on the U.S. venture ecosystem:

-Nearly $28 billion was invested into early-stage startups in 2018, with median deal size increasing 25 percent to $7 million last quarter.

-Ten funds have raised more than $500 million this year and another five, including Lightspeed Venture Partners and Index Ventures, have closed on more than $1 billion.

-Companies based on the West Coast were responsible for 54.7 percent of deal value in 3Q but other regions are catching up: New England (12 percent), the Mid-Atlantic (20 percent) and The Great Lakes (5 percent). With the Great Lakes region only accounting for 5% of Deal Value this is exactly why REO Capital chose not to get Licensed in Michigan.

-Investment in U.S. pharma and biotech has reached a new high of $14 billion already in 2018.

-Corporate venture capital activity is heating up. This year, CVCs invested $39.3 billion in U.S. startups, more than double the $15.2 billion invested in 2013.

-VC-backed companies are exiting via buyouts more than ever.

Article was written by Kate Clark and Information came from Pitchbook.

For more information Contact John Denes at 310-909-8727 or at www.reocapitalllc.comSee REO Capital Website

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