Big Late-Stage Deals and Unicorns Drive U.S. Venture Activity Higher

cash, folding money,

over 50 percent of all U.S. venture-backed IPOs were in the healthcare sector during the quarter. The biggest IPO valuation for a U.S. company was San Mateo, CA-based GoPro, which was valued at roughly $3.6 billion when it went public late last month.

California continues to dominate the geographical stats, accounting for more than $8.9 billion (55 percent) of all capital invested nationwide, and 442, or 45 percent, of all deals in the quarter. Most of that venture activity was focused in Silicon Valley, though, with San Francisco and eight cities representing more than 300 deals and $6.9 billion in startup capital.

Yet, VC investments in New York also showed strong growth, reaching more than $1.1 billion for the quarter. Nearly 90 percent of that was invested in New York’s Internet and mobile sectors, and the Empire State’s share of deals (108) eclipsed Massachusetts for the tenth consecutive quarter.

VCs invested $393 million in 27 deals in Washington state during the quarter, and $139 million in 32 startups in Texas, according to CB Insights.

As usual, the Internet sector accounted for the single biggest chunk of venture capital in the quarter, with $5.6 billion (45 percent) going into 437 deals (41 percent) throughout the United States.

Venture investments in the mobile and telecom sector, driven by mega investments in such companies as Uber, Lyft, Apigee, and Kony, leaped to a record $2.59 billion—132 percent higher than the $1.1 billion high set in the third quarter of 2013.

The healthcare sector rebounded during the quarter, with over $2.7 billion going into 161 deals. Venture activity even picked up in the cleantech sector, with $777 million invested in 51 deals. That was a 67 percent increase in funding and a 28 percent rise in deals compared with the same quarter in 2013, when venture firms invested $465 million in 40 deals.

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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.