For about two years now, the VC industry has been in a pattern of decline as the hyper activity of 2014 and 2015 gradually deflated back to normal. Now for two quarters in a row, overall VC activity within the US has been on the upswing. Deal count at both the early and late stage has seen increases, undoubtedly helped out by the robust fundraising that has taken place in recent years. Companies are still finding it difficult to find an exit route, however, and the investment-to-exit ratio has pushed to the highest spread in the past decade. While we don't expect this generate negative consequences, it will be interesting to see if the average time to exit continues to lengthen, which could eventually have consequences for LPs.
The 2Q 2017 PitchBook-NVCA Venture Monitor takes a holistic view of the industry, sifting through deal, exit and fundraising datasets, with special sections covering corporate VC, growth equity and activity by region.
- Late-stage deal count is up 20% since 4Q 2016
- The number of completed exits in 2Q fell to the lowest figure since 2011
- Even after the record fundraising of 2016, VC vehicles have received more than $19 billion in commitments through June, though NEA's record largest $3.3 billion fund stands as an outlier