Late Stage Venture Capital Financings Reach Record High in 2015

by Adam Jackson

  • 30 Jun 2016
  • PE
  • VC

Preqin’s Private Equity Online shows that there have been 2,721 late stage venture capital financings, defined as series D or later, announced globally since 2007, with an aggregate value of $110bn. Between 2007 and 2015, appetite for late stage financings has remained relatively consistent in terms of the total number of financings, with a low of 269 in 2010 and a high of 305 in 2014. However, aggregate deal value has experienced a significant increase over the past two years, rising 153% from $8.9bn in 2013 to $22.4bn in 2014. This influx was due in part to several large financing rounds completed in 2014, including two $1.2bn financings for Uber Technologies, as well as the $3bn in late stage financing received by Xiaomi in the same year.

Aggregate deal value continued to rise going into 2015, despite a decrease in the total number of recorded financing rounds. Between 2014 and 2015, the total number of financings decreased by 3% from 305 to 295; however, this was not reflected in aggregate value, which saw a 21% increase from $22.4bn to a record $27.2bn over the period. Uber Technologies was once again a significant contributor, with two $1bn late stage financing rounds, while Social Finance and SpaceX each raised $1bn.

North America is the most prominent region in terms of late stage venture capital financings, with 2,212 financings completed since 2007 for an aggregate $80bn. Despite North America recording the vast majority of late stage financing value since 2007, the South Asian region has the highest average ($101mn) for late stage financing, followed by Greater China ($88mn), compared with an average $36mn for late stage North American venture capital deals.

Late stage transactions in the internet sector represent 27% of the value of all venture capital financings since 2007 ($30bn), the highest amount secured for any industry. The healthcare industry, the most prominent sector in terms of the number of financings since 2007, has contributed $20bn (18% of the total) in late stage financing through 727 venture capital deals. The business services industry records the highest average late stage financing value ($93mn) since 2007, despite only contributing 4% of the total value.

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