Highlights from the Fenwick & West 2Q11 Venture Capital Survey

Each quarter the legal eagles at Fenwick & West run a great survey on the state of venture capital and write a brief report that rounds-up data from other sources and publishes their survey results.  Here are some quick highlights from the 2Q11 venture capital survey:

  • Total VC investment was $8.0B, a 20% increase compared to the $6.4B invested in 1Q11 per VentureSource.  Of this, $2.9B was invested in Silicon Valley.
  • 14 venture-backed companies went public in 2Q11, raising $1.7B.  In 1Q11 11 companies went public raising $700M, per VentureSource.
  • Venture capitalists raised $2.7B in funding in 2Q11, a 65% decline relative to the $7.6B raised in 1Q11, per Thompson/NCVA.
  • The Silicon Valley Venture Capitalist Confidence Index dropped to 3.66 out of 5.0, a sharp drop from the 3.91 recorded in 1Q11.  I added the red line to chart below which seems to indicate that confidence is about average since 1Q04.

  • 19% of financing rounds were series A, about normal for the past two years, somewhat contradicting the analysis in this recent TechCrunch story, The Series A Squeeze.  (Though it’s unclear how Fenwick handles seed fundings in their study.)
  • 61% of financing rounds were up-rounds, 14% were flat, and 25% were down.
  • The Fenwick & West VC Barometer, a measure of per-share pricing, was up 71%, with the software sector leading the way at 123% and internet / digital media at 115%.
  • 37% of rounds included senior liquidation preferences and, of those, 29% were multiple liquidation preferences.
  • 38% of rounds had participating preferences.
The full survey is available here.

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