U.S. Venture Activity Remains Steady as IPOs Rise in Second Quarter

cash, folding money,

Venture-backed IPOs staged something of a comeback during the second quarter, as 22 VC-backed startups went public with an aggregated valuation of about $9.6 billion. Healthcare companies made up about half of those IPOs, according to the venture-data tracking firm, CB Insights.

Still, it was a relatively modest period for VC activity. CB Insights says U.S. venture investments totaled $7 billion in 807 deals during the second quarter that ended June 30th.

VC activity was marginally better than the first three months of 2013, when venture firms invested $6.9 billion in 841 deals. The deal count has remained fairly consistent, though, with an average of 825 deals a quarter over the past five quarters, according to CB Insights data. The $7 billion invested during the three months  was down 14 percent from the second quarter of 2012, when VCs invested $8.1 billion in 812 deals.

Mergers and acquisition deals also were in line with the five-quarter trend, and CB Insights counted 105 M&A deals during the second quarter. There was a clear upswing in venture-backed IPOs, though, with Seattle’s Tableau Software (NYSE: [[ticker:DATA]]) ringing the bell as the biggest tech IPO.

Life sciences, biotech, and medical device companies (the category CB Insights calls healthcare) also showed signs of recovery, with notable IPOs including San Diego’s Receptos (NASDAQ: [[ticker:RCPT]]) and Ambit Biosciences (NASDAQ: [[ticker:AMBI]]); Cambridge, MA-based Epizyme (NASDAQ: [[ticker:EPZM]]); and two companies from Watertown, MA—Enanta Pharmaceuticals (NASDAQ:[[ticker:ENTA]]) and Tetraphase Pharmaceuticals (NASDAQ: [[ticker:TTPH]]).

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Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.