First-Quarter VC Activity Buoyant at $12.1 Billion, & Top 10 Deals

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first quarter. Later-stage deals accounted for 22 percent of total deal volume.

In other highlights, the first-quarter MoneyTree Report shows:

—Software-related deals continue to get the biggest chunk of venture funding, with $5.1 billion going into 376 deals.  While that was a 12 percent increase from the $4.5 billion invested in the previous quarter (and a 5 percent decrease from the 395 deals), it was down from the first quarter of 2015, when VCs invested $5.6 billion invested in 456 software deals.

In a discrete classification of “Internet-specific” deals, VC firms invested $2.4 billion into 232 companies that are fundamentally dependent on the Internet.. That was down from the $3.1 billion (-24 percent) that went into 242 deals (-4 percent) in the fourth quarter of 2015.

Agrawal, who invests mostly in software-as-a-service and Internet companies for Battery Ventures, said software remains “a very strong macro driver” by enabling companies to realize cost savings through automation. “Migration to the cloud is still early, it only represents about 15 percent of the industry,” Agrawal said. “That means a whole lot of software is still being done the old-fashioned way.”

—Venture investments in life sciences startups (including both biotechnology and medical devices) amounted to $2.3 billion invested in 177 deals, and accounted for 19 percent of all venture capital deployed during the first quarter. VCs invested $1.8 billion into 118 biotech deals during the first quarter, marking an 11 percent increase from the $1.6 billion invested in the prior quarter. The deal count was 19 percent higher than the 99 deals done in the previous quarter.

—Media and Entertainment startups ranked third in terms of deployed capital, with $930 million invested in 109 deals.

First-Quarter Top 10 Deals, based on MoneyTree Report

LyftSan FranciscoSoftware$1 billion
Magic LeapDania, FLComputers & Peripherals$793.5 million
Sunnova EnergyHoustonIndustrial Energy$300 million
UberSan FranciscoSoftware$201.1 million
Flatiron HealthNew YorkSoftware$175 million
DomoAmerican Fork, UTSoftware$131 million
DoorDashSan FranciscoMedia & Entertainment$127 million
FuzeCambridge, MASoftware$111 million
BettermentNew YorkFinancial Services$100 million
Snagajob.comGlen Allen, VAMedia & Entertainment$100 million

 

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Bruce V. Bigelow was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Follow @bvbigelow

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