Q4 2016 – A Solid Close to a Strong Year of Financings

In the fourth quarter of 2016, there were slightly higher deal volumes and aggregate dollars raised compared to prior quarters. In Q4 2016, Cooley handled 187 disclosable deals representing more than $2.7 billion of invested capital. While deal volume increased by 18% compared to Q4 2015, the total proceeds decreased by roughly 23%. In Q4, we included seed-stage financings for the first time. Over the course of the past two years, the median pre-money valuation for seed-stage financings was $6 million and the median deal size was approximately $2 million.

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Commentary from Mark Suster on the state of VC investing in Q4 2016

Mark Suster, partner at Upfront Ventures, discusses recent venture trends and what’s ahead for 2017.

2016 saw the rise of the global investor: Out of Japan and China we saw a massive increase in capital come into the US market.

Corporate VC involvement: Not only are there new CVCs, but they’re writing much bigger checks.

Founder-friendly terms: Terms are shifting back to being founder-friendly. And salaries are on the rise. I’m willing to bet that option refreshes are also on the rise. I expect that to be true for 2017 and 2018 unless there’s an unforeseen black swan.

Trump: Under the new administration, one other thing that is likely to happen is the repatriation of capital for the large corporates, including the global tech giants.

Read full commentary from Mark Suster.


GO Visualize (powered by Tableau)

Welcome to Cooley GO Visualize, which allows you to drill down on trends gleaned from deals we’ve worked on with entrepreneurs. The data you see here will be updated in conjunction with our quarterly VC Financing Reports. We hope you’ll find this and other Cooley GO resources such as the Convertible Note Term Sheet Generator and our guidance in Raise helpful in navigating and accelerating your fundraising efforts.

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