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PitchBook Analyst Note: 2021 US Venture Capital Outlook

Q4 2020

PitchBook Analyst Note: 2021 US Venture Capital Outlook

December 11, 2020

PitchBook Analyst Note: 2021 US Venture Capital Outlook
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Our 2021 Venture Capital Outlook forecasts trends that will shape the US VC industry in the upcoming year and reviews our analysts' predictions from 2020.

2021 predictions:

  • Biotech & pharma VC deal activity will likely exceed $20 billion for the second consecutive year.
  • Established managers will increase proportion of overall VC fundraising to above 75% for the first time since 2012.
  • Number of SPAC IPOs will decline YoY in 2021, and fewer than 30% of 2020 SPACs will close an acquisition. 
  • More VC-backed exits over $1 billion will occur via direct listings rather than SPAC listings in 2021.
  • Proportion of late-stage VC deal value relative to IPO proceeds will continue to compress in 2021.
  • Bay Area will fall below 20% of US deal count for first time.
  • Nontraditionals will lead a record 1,600 early- and late-stage VC deals as venture becomes more ingrained in their investment strategy.
  • Venture debt issuance will continue a string of record years, surpassing 2,600 deals and $25 billion originated for the fourth consecutive year.