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Q1 2012 Venture Capital Report

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					                                                                                       Venture Capital Activity Report | Q1 2012




TABLE OF CONTENTS
QUARTER SUMMARY                                               2

QUARTERLY TRENDS                                              3

SECTOR REVIEW                                                 11
1      INTERNET                                               11

2      MOBILE & TELECOM                                       18

3      HEALTHCARE                                             25

4      GREEN / CLEAN TECH                                     32

GEOGRAPHIC REVIEW
1      CALIFORNIA                                             39

2      MASSACHUSETTS                                          45

3      NEW YORK                                               50

4      WASHINGTON                                             56

5      TEXAS                                                  61



DEFINITIONS & DATA INTEGRITY                                  66




    © 2010, CB Insights. All rights reserved. For more information about CB Insights, please email info@cbinsights.com.

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  2                                                                        Venture Capital Activity Report | Q1 2012


Q1 2012 – This Quarter in Venture Capital
VCs aggressively doing deals in Q1 2012, but the absence of mega VC deals put a
damper on funding levels as industry hit funding levels not seen since Q2 2010.
VCs weren’t hesitant to open up their wallets in Q1 2012 making 785 investments in the quarter – the 2nd most in the last
nine quarters. But despite the aggressive number of deals, the checks written were smaller than prior quarters as
institutional investors plowed $5.9 billion into companies – the lowest level of VC funding since Q2 2010.

Although this represents a 22% decline in funding from Q4 2012, we do not think that a single quarter dip in funding is in any
way symptomatic of any sort of correction or any sort of bubble bursting. Deal activity which we view as a better gauge of
investor sentiment remains strong. The funding dip is primarily the result of fewer VC mega deals in the quarter which as the
quarter illustrates can and do move numbers significantly up when present and down wildly when absent.

Note: Only deals in which VCs are participating are included. Companies which raise money from mutual or private equity funds or
corporations (unless it is their corporate venture arms) are not included. We recommend you review our definitions and methodology on
p. 66 to see what is included/excluded as there is a great amount of misinformation out there.

VCs Continue to Plant Their Seeds                                    Internet Deals Climb on Back of Seed Deals

  Seed investing hit a historical high with almost 1 of every           While internet funding fell 17%, deal volume grew 16%
  5 VC deals being an early stage seed VC investment.                   with a five quarter high for seed VC deals.
  These “call options” as we’ve referred to them in the past
  allow venture investors to invest minimal amounts in               Healthcare’s Flu Like Symptoms Continue
  companies (primarily tech) and get first access to invest in
  these companies should they show signs of going from                  After a strong Q4'11, VC funding to healthcare hit a five
  seed to something more substantial.                                   quarter low while deals stayed within their recent
                                                                        range. The sentiment and chatter around healthcare
  On the flipside, if the seed investment doesn’t work out,             continues to be mixed and so the sector will remain
  the firm has put little capital at risk. Increased capital            range-bound unless some catalyst, i.e., massive exit,
  efficiency in tech has made these types of seed                       regulatory change, etc. can spur it to move.
  investments increasingly popular and Q1 2012 starkly
  demonstrated this with 19% of deals being of the seed              NY Hits Five Quarter Funding Low. Uh Oh?
  variety.
                                                                        New York funding dipped but the state’s deal activity
The “Instagram Effect”                                                  stayed strong so we don’t think the decline is a problem
                                                                        (yet). NY remains a hub for early stage investment with
  For the first time, we’ve broken out mobile & telecom                 30% of deals in the seed stage and another 30%+ in the
  investment trends in this report – what we’re calling our             Series A stage.
  own little “Instagram Effect”. While mobile deal volume
  remained strong, funding dipped in Q1’12. Like most tech           Mass Sees Five Quarter Low on Deals & Dollars
  investment sectors, VCs are favoring small seed
  investments in the mobile sector. And since the                       Unlike NY, Mass fell on both deals and dollars. The gap
  Instagram acquisition by Facebook was announced when                  vs. NY on the tech front also seems to worsen for Mass
  Q1’12 was already in the books, we expect that the                    although the state continues to have a more balanced
  coming quarters will be interesting for the mobile sector as          attack with healthcare and green tech. If, however, there
  companies and investors try even more aggressively to                 is a coming wave of internet & mobile opportunities, is
  ride the mobile wave.                                                 Mass not positioned to capitalize on these opportunities?

Green Tech Sputters                                                  Washington Bucks National Trend – Funding Climbs

  With no mega deals and continued uncertain sentiment                  While national VC funding fell 22%, Washington actually
  green tech saw its lowest level of deals and funding in the           climbed 41% making it the only major VC recipient to
  last five quarters. Will something help Green Tech shake              register an increase in funding.
  its malaise in the coming quarters?
                                                                     California Leads but Sees Big Funding Dip.

                                                                        Cali funding dips 26% vs. Q4’11, but still leads the pack.

 www.cbinsights.com
 3                                               Venture Capital Activity Report | Q1 2012


$5.9B in 785 Deals – Strong Deal Activity; Few Mega Deals
After four straight quarters of $7B+ funding, Q1 2012 saw a steep drop in funding
dollars although deal activity stayed very strong.




www.cbinsights.com
4                                              Venture Capital Activity Report | Q1 2012


NY Jumps Ahead of Mass On Deal Share
After Q4’10 dip below Mass, NY snaps back to #2 on number of VC deals. Overall,
league tables for top states remain largely in-line with historical levels.




www.cbinsights.com
 5                                                Venture Capital Activity Report | Q1 2012


Cali, Mass, NY Take Lowest Share of Funding in Last 5 Qtrs
NY’s funding fell to a five quarter low while Washington registered it’s highest amount
of funding in the last five quarters.




www.cbinsights.com
 6                                              Venture Capital Activity Report | Q1 2012


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 7                                               Venture Capital Activity Report | Q1 2012


New Year Starts with Bang (At Least in Terms of Deals)
January 2012 continued the deal momentum seen in late 2011 with the month
registering the highest deal count in the last 18 months. Funding levels stayed
depressed throughout the quarter with few mega deals to buoy totals.




www.cbinsights.com
 8                                               Venture Capital Activity Report | Q1 2012


VCs Aggressively Plant Their Seeds in Q1 2012
Seed VC deals register five quarter high and help to push deal activity numbers for the
quarter higher. Funding distribution across series stays consistent with historical
patterns. In total, seed and Series A continue to make up almost 50% of deals.




www.cbinsights.com
 9                                                 Venture Capital Activity Report | Q1 2012


Healthcare Slips Back on Deals While Internet Grows
After an uptick in Q4’11, healthcare falls back on deals and maintains its historical
funding levels. Internet investments gain increased share of total VC deals.




www.cbinsights.com
10                                              Venture Capital Activity Report | Q1 2012


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11                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     INTERNET




www.cbinsights.com
12                                                Venture Capital Activity Report | Q1 2012


Internet Deals Way Up While Funding Hits Five Qtr Low
Without a massive Facebook, Twitter, etc mega-funding, internet dollars slip




                                                                                              Internet
significantly, but on the back of strong Seed and Series A activity, deals are way up.
Versus Q4’11, deals are up 15%. Relative to Q1’11, deals are up 14%.




www.cbinsights.com
13                                              Venture Capital Activity Report | Q1 2012


Mass Falls to Distant Third for Internet VC Deals
NY nearly triples Massachusetts on number of internet deals. Cali continues its




                                                                                            Internet
chokehold on the #1 position for both deals and funding.




                                                                Quarter Highlights

                                                                326 deals | $2,067M

                                                                Top Deals
                                                                 Yammer
                                                                 Lithium Technologies
                                                                 Code 42 Software
                                                                 Apptio
                                                                 Kinnser Software
                                                                 Trialpay


                                                                Top Cities
                                                                 San Francisco, CA
                                                                  47 deals | $447M
                                                                 Mountain View, CA
                                                                  14 deals | $173M
                                                                 New York, DC
                                                                  47 deals | $153M
                                                                 Austin, TX
                                                                  9 deals | $76M
                                                                 Santa Monica, CA
                                                                  5 deals | $65M
                                                                 Bellevue, WA
                                                                  2 deals | $58M
                                                                 Palo Alto, CA
                                                                  14 deals | $56M
                                                                 Emeryville, CA
                                                                  1 deals | $53M
                                                                 Minneapolis, MN
                                                                  1 deals | $53M
                                                                 Boulder, CO
                                                                  5 deals | $52M




www.cbinsights.com
14                                                Venture Capital Activity Report | Q1 2012


Mass Hits Five Quarter Low on Internet Deals
NY retains to the #2 spot for Internet, although loses significant share of funding to Cali




                                                                                              Internet
and others. Massachusetts falls to 5 quarter low on share of internet deals.




www.cbinsights.com
15                                               Venture Capital Activity Report | Q1 2012


Seed Internet Deals Soar. Series B Funding Gets Crunched.
Seed deals in web companies breaks out above already-record levels. Series A




                                                                                             Internet
funding sees five quarter high while internet Series B deals see a multi-quarter low.




www.cbinsights.com
16                                              Venture Capital Activity Report | Q1 2012


Big Data Pushes Business Intelligence into Deal Lead
Social internet companies, usually a big area of investment, fell several spots with




                                                                                            Internet
some atypical areas like Business Intelligence and Monitoring & Security jumping up to
the league tables.




www.cbinsights.com
17                                              Venture Capital Activity Report | Q1 2012


Early Stage Medians Remain Flat, Later Stage Uptick
Early stage Internet deal sizes remain fairly steady, while Series C and beyond see




                                                                                            Internet
uptick since last quarter.




www.cbinsights.com
18                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     MOBILE & TELECOM




www.cbinsights.com
19                                               Venture Capital Activity Report | Q1 2012


Mobile Deal Activity Stays Strong but Funding Dips
Funding falls to a five quarter low dropping 42% vs. Q4’11 and 29% vs. Q1’11 but deal




                                                                                             Mobile
activity stays steady. Q2’12 will be an interesting quarter to watch: will there be an
“Instagram Effect” on mobile funding and deal activity? (We expect there will be)




www.cbinsights.com
20                                               Venture Capital Activity Report | Q1 2012


Like Internet VC, Cali Dominates with NY 2nd in Mobile VC
NY is a distant 2nd to California in terms of both deals and dollars. Massachusetts and




                                                                                             Mobile
Washington also exhibit mobile VC strength in Q1’12.




                                                                 Quarter Highlights

                                                                 93 deals | $453M

                                                                 Top Deals
                                                                  BOKU
                                                                  Ruckus Wireless
                                                                  Jasper Wireless
                                                                  Ooma
                                                                  Verivo Software



                                                                 Top Cities
                                                                  San Francisco, CA
                                                                    8 deals | $62.91M
                                                                  Palo Alto, CA
                                                                    9 deals | $49.37M
                                                                  Mountain View, CA
                                                                    7 deals | $40.6M
                                                                  New York, NY
                                                                    10 deals | $39.37M
                                                                  Sunnyvale, CA
                                                                    3 deals | $25.75M
                                                                  Bellevue, WA
                                                                    2 deals | $22.8M
                                                                  Waltham, MA
                                                                    1 deals | $17M
                                                                  Boston, MA
                                                                    3 deals | $15.93M
                                                                  Denver, CO
                                                                    2 deals | $14M
                                                                  Sioux Falls, SD
                                                                    1 deals | $12M




www.cbinsights.com
21                                                  Venture Capital Activity Report | Q1 2012


Deal/Dollar Share In Line With Historical Levels
Washington and Colorado register healthy quarters for mobile deals and funding.




                                                                                                Mobile
Funding levels by state continue to swing wildly in mobile & telecom as the category is
still in its infancy, where a large deal can seismically shift the quarter’s funding totals.




www.cbinsights.com
22                                              Venture Capital Activity Report | Q1 2012


Seed VC Deals in Mobile Hit Five Quarter High
 Seed and Series A make up two-thirds of deals, highlighting the relative nascence of




                                                                                            Mobile
companies in mobile and the burgeoning interest in the mobile sector. Series B and C
see lowest portion of financing dollars in the last five quarters.




www.cbinsights.com
23                                               Venture Capital Activity Report | Q1 2012


Mobile Advertising, Gaming and Application Dev Win Deals
Deal and dollar distribution remains diverse with numerous sub-industries within




                                                                                             Mobile
mobile garnering funding. The “land grab” is still on within mobile as category leaders
are still being determined across a wide variety of mobile focus areas.




www.cbinsights.com
24                                              Venture Capital Activity Report | Q1 2012


Early Stage Median Deal Sizes Stay Flat
No clear trend for mobile investment medians is discernible. While early stage deal




                                                                                            Mobile
medians have stayed mostly range bound, Series B and Series C medians have
dropped while Series D and later-stage Series E+ have ticked up.




www.cbinsights.com
25                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     HEALTHCARE




www.cbinsights.com
26                                                Venture Capital Activity Report | Q1 2012


Healthcare Hits 5-Quarter Funding Low, Seeks Lifeline




                                                                                              Healthcare
Healthcare follows up its strongest quarter in funding over the previous five quarters
with its weakest one since 2010. Deal volume reverts to familiar levels.




www.cbinsights.com
27                                            Venture Capital Activity Report | Q1 2012


Cali and Mass Remain Healthcare Breadwinners




                                                                                          Healthcare
California and Massachusetts combine for 46% of deal share and 61% of funding
dollars. Beyond the top two, the field remains diverse as usual.




                                                              Quarter Highlights

                                                              153 deals | $1,449M

                                                              Top Deals
                                                               Warp Drive Bio
                                                               Sientra
                                                               Ariosa Diagnostics
                                                               Apollo Endosurgery
                                                               Mevion Medical Systems



                                                              Top Cities
                                                               Boston, MA
                                                                 2 deals | $128M
                                                               San Diego, CA
                                                                 6 deals | $90M
                                                               Redwood City, CA
                                                                 4 deals | $86M
                                                               Santa Barbara, CA
                                                                 1 deals | $65M
                                                               San Jose, CA
                                                                 2 deals | $65M
                                                               Cambridge, MA
                                                                 7 deals | $53M
                                                               La Jolla, CA
                                                                 2 deals | $50M
                                                               Austin, TX
                                                                 2 deals | $48M
                                                               Littleton, MA
                                                                 1 deals | $45M
                                                               Ann Arbor, MI
                                                                 3 deals | $37M




www.cbinsights.com
28                                                 Venture Capital Activity Report | Q1 2012


California Loses Deal Share for the 5th Straight Quarter




                                                                                               Healthcare
The field continues to chip away at California’s lead in deal share, as California falls to
27% of Healthcare deal flow – a 10% drop since Q1 2011. Meanwhile, Mass and Cali
both lose a bit of funding share as well.




www.cbinsights.com
29                                              Venture Capital Activity Report | Q1 2012


Seed Jumps Significantly, but Overall Early Stage Dips




                                                                                            Healthcare
Seed deals double their share since Q4 2011, owning 14% of overall dealflow.
However, Series A takes a step back in terms of both deals and dollars, netting an
overall drop in early stage Healthcare activity.




www.cbinsights.com
30                                               Venture Capital Activity Report | Q1 2012


Usual Suspects: Medical Devices, Pharma, Biotech Own Q1




                                                                                             Healthcare
Medical devices stays atop the charts in terms of both deals and dollars, followed up
by Biotech and Pharma, respectively.




www.cbinsights.com
31                                              Venture Capital Activity Report | Q1 2012


Healthcare Medians Continue to Drop in Q1




                                                                                            Healthcare
Following a trend in recent quarters, Healthcare median deal sizes drop almost across
the board, with the sole exception in Series E+ which saw a significant bump.




www.cbinsights.com
32                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     GREEN & CLEAN TECH




www.cbinsights.com
33                                                Venture Capital Activity Report | Q1 2012


Double Whammy – Green Tech Deals & Funding Hit Lows
Q1 2012 sees funding and deal levels drop 40% and 18% respectively from Q4’11 with




                                                                                              Green
both measures hitting five quarter lows. The absence of green tech mega deals hurt
funding totals, but it’s the drop in deal activity that is probably most worth tracking.




www.cbinsights.com
34                                               Venture Capital Activity Report | Q1 2012


Cali, Mass Dominate. Unusual Suspect, Illinois Enters Fray
Cali remains the overwhelming leader in terms of Green Tech deals and dollars. Mass




                                                                                             Green
maintains its #2 spot. Lack of mega deals doesn’t cause any wild gyrations among state
funding shares. Illinois sees a diverse array of renewables and energy efficiency deals
pushing them into green tech limelight.


                                                                 Quarter Highlights

                                                                 56 deals | $763M

                                                                 Top Deals
                                                                  SolarCity
                                                                  Joule Unlimited
                                                                  LanzaTech
                                                                  MiaSole
                                                                  Renmatix


                                                                 Top Cities
                                                                  San Mateo, CA
                                                                    1 deals | $81M
                                                                  Bedford, MA
                                                                    1 deals | $70M
                                                                  Roselle, IL
                                                                    1 deals | $56M
                                                                  Santa Clara, CA
                                                                    1 deals | $55M
                                                                  King of Prussia, PA
                                                                    1 deals | $50M
                                                                  San Jose, CA
                                                                    3 deals | $39M
                                                                  San Diego, CA
                                                                    3 deals | $38M
                                                                  Sunnyvale, CA
                                                                    2 deals | $34M
                                                                  Houston, TX
                                                                    2 deals | $32M
                                                                  Livermore, CA
                                                                    1 deals | $25M




www.cbinsights.com
35                                                Venture Capital Activity Report | Q1 2012


Cali, Mass Take Almost $7 of Every $10 Green Tech Dollars
Besides Illinois’ ascent into deal and funding league tables, the rest of the share




                                                                                              Green
breakdowns by states for deals & funding are in line with historical averages.




www.cbinsights.com
36                                              Venture Capital Activity Report | Q1 2012


Early Stage Green Tech Deals Hit 5-Quarter Low
After Q4’11’s early stage investment peak, Q1’12 sees early stage clean tech deal




                                                                                            Green
share fall of a cliff. Series C stage investments clean up on the funding front in
Q1’12.




www.cbinsights.com
37                                              Venture Capital Activity Report | Q1 2012


Energy Efficiency Climbs to Five Quarter High on Deals
Renewables retain top spot on deals and dollars, but energy efficiency technology




                                                                                            Green
continues to see strong deal activity.




www.cbinsights.com
38                                              Venture Capital Activity Report | Q1 2012


Green Tech Median Generally Declining
With sector sentiment remaining mixed, median values across different stages all




                                                                                            Green
decline as compared to Q1 2011.




www.cbinsights.com
39                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     CALIFORNIA




www.cbinsights.com
40                                                         Venture Capital Activity Report | Q1 2012


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41                                               Venture Capital Activity Report | Q1 2012


What’s Wrong With This Picture? Cali Stumbles
California’s funding level drops 26% versus Q4 2011 and 27% versus a year ago,




                                                                                             California
leading the precipitous drop in overall venture funding experienced in Q1. On the
bright side, deal volume remains strong.




www.cbinsights.com
42                                             Venture Capital Activity Report | Q1 2012


Lack of Mega-Deals Responsible for Q1 Cali Flop




                                                                                           California
Whereas Q4 2011 saw 4 deals of at least $100M each in California, The Golden
State’s largest deal this quarter is Yammer at $85 million.




                                                               Quarter Highlights

                                                               309 deals | $2,857M

                                                               Top Sector
                                                                 # of Deals – Internet
                                                                 $ of Funding – Internet

                                                               Top Deals
                                                                Yammer
                                                                SolarCity
                                                                Sientra
                                                                Appirio
                                                                MiaSole


                                                               Top Cities
                                                               San Francisco
                                                                64 deals | $555M
                                                               Mountain View
                                                                26 deals | $315M
                                                               San Mateo
                                                                12 deals | $189M
                                                               Redwood City
                                                                11 deals | $158M
                                                               San Diego
                                                                12 deals | $146M
                                                               San Jose
                                                                15 deals | $143M
                                                               Santa Clara
                                                                8 deals | $142M
                                                               Palo Alto
                                                                30 deals | $138M
                                                               Santa Monica
                                                                8 deals | $110M
                                                               Sunnyvale
                                                                12 deals | $95M




www.cbinsights.com
43                                                 Venture Capital Activity Report | Q1 2012


Healthcare & Internet Combine for Nearly 60% of Funding
Healthcare loses a bit of share in terms of both deals and dollars, but overall Internet




                                                                                               California
and Healthcare continue to hold the two top spots in California in terms of venture
funding.




www.cbinsights.com
44                                                Venture Capital Activity Report | Q1 2012


Seed Continues to Grow Share of Deal Volume in Cali
Overall early stage sees a bump in share of deal volume as Seed grabs 17% of overall




                                                                                              California
dealflow in California. In terms of funding, however, later stage deals continue to exert
pressure, with Series C and beyond taking two thirds of funding.




www.cbinsights.com
45                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     MASSACHUSETTS




www.cbinsights.com
46                                              Venture Capital Activity Report | Q1 2012




                                                                                            Massachusetts
Mass Continues Roller Coaster Ride, This Time Down
Turmoil in Boston isn’t isolated to the Red Sox as Massachusetts experiences a 5-
quarter low in terms of both VC deals and dollars.




www.cbinsights.com
47                                                Venture Capital Activity Report | Q1 2012




                                                                                                Massachusetts
Healthcare Continues Dominance in Mass, Internet #2
Healthcare and Internet continue their hold on the top two spots in terms of both deals
and dollars. Energy is a convincing #3 in terms of funding.




                                                                  Quarter Highlights

                                                                  76 deals | $650M

                                                                  Top Sector
                                                                    # of Deals – Healthcare
                                                                    $ of Funding - Healthcare

                                                                  Top Deals
                                                                   Warp Drive Bio
                                                                   Joule Unlimited
                                                                   Mevion Medical Systems
                                                                   Neolane
                                                                   RaNA Therapeutics

                                                                  Top Cities
                                                                   Boston
                                                                     12 deals | $166M
                                                                   Waltham
                                                                     10 deals | $88M
                                                                   Cambridge
                                                                     14 deals | $78M
                                                                   Bedford
                                                                     3 deals | $77M
                                                                   Littleton
                                                                     1 deals | $45M
                                                                   Newton
                                                                     2 deals | $28M
                                                                   Lexington
                                                                     3 deals | $25M
                                                                   Medford
                                                                     1 deals | $20M
                                                                   Winchester
                                                                     1 deals | $15M
                                                                   Woburn
                                                                     1 deals | $15M




www.cbinsights.com
48                                              Venture Capital Activity Report | Q1 2012

Overall Dip in Mass Doesn’t Affect the Mix




                                                                                            Massachusetts
Deal and dollar distribution in Massachusetts remains largely unchanged since Q4
2011, with Healthcare and Internet remaining atop the board.




www.cbinsights.com
49                                              Venture Capital Activity Report | Q1 2012




                                                                                            Massachusetts
Seed Deals Rally, but Overall Early Stage Loses Ground
Seed takes 16% over overall deal flow in Massachusetts, but overall early stage (Seed +
Series A) dips dramatically since Q4 in terms of funding.




www.cbinsights.com
50                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     NEW YORK




www.cbinsights.com
51                                             Venture Capital Activity Report | Q1 2012


NY Hits Five Quarter Funding Low; Deals Stay Strong




                                                                                           New York
NY funding falls 41% vs. Q4’11 and 25% vs. Q1’11 while VC deals actually climb 11%
sequentially and 13% quarter-over-quarter.




www.cbinsights.com
52                                              Venture Capital Activity Report | Q1 2012


Get Started for Free with CB Insights
Basic membership on CB Insights is free. Just visit http://www.cbinsights.com. Or
connect with us via any of the following.




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                Follow us @cbinsights            Click here to receive our weekly
                                                 dealflow newsletter.




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                                                 212-292-3148
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www.cbinsights.com
53                                               Venture Capital Activity Report | Q1 2012


Internet Still Rules, but Mobile and Healthcare Show Life




                                                                                             New York
Internet continues to command the lion’s share of deals and dollars, but Mobile deals
register volume and Financial consumes serious dollars in Q1.




                                                                 Quarter Highlights

                                                                 81 deals | $335M

                                                                 Top Sector
                                                                   # of Deals – Internet
                                                                   $ of Funding - Internet

                                                                 Top Deals
                                                                  Capital Access Network
                                                                  Aereo
                                                                  KEMP Technologies
                                                                  Buzzfeed
                                                                  Peek

                                                                 Top Cities
                                                                  New York
                                                                    66 deals | $243M
                                                                  Scarsdale
                                                                    1 deals | $30M
                                                                  Long Island City
                                                                    2 deals | $22M
                                                                  Yaphank
                                                                    1 deals | $16M
                                                                  Ithaca
                                                                    1 deals | $6M




www.cbinsights.com
54                                                 Venture Capital Activity Report | Q1 2012


Internet and Mobile are 82% of Deals and 67% of Funding




                                                                                               New York
Internet deals jump back in Q1’12. When aggregated with mobile and other tech
investments, it is clear that NY’s VC ecosystem future is tethered to the fate of tech.




www.cbinsights.com
55                                              Venture Capital Activity Report | Q1 2012


NY Early Stage Investments Jump Even More




                                                                                            New York
 Following Q4’11’s strong early stage performance, Q1’12 sees 63% of deals going to
Seed and Series A transactions. NY’s presence as an early stage investment hub
continues to grow.




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56                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     WASHINGTON




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57                                               Venture Capital Activity Report | Q1 2012


Washington Bucks the Trend, Sees 5-Quarter Funding High




                                                                                             Washington
Washington fights off the national swoon, and instead experiences a five-quarter high
with $206 million in VC funding. Deal volume also sees an uptick since Q4.




www.cbinsights.com
58                                                Venture Capital Activity Report | Q1 2012


Mobile & Telecom Jumps to #2 Spot in Washington




                                                                                              Washington
Internet and Healthcare, which traditionally occupy the top two spots are joined by Mobile
& Telecom which sees a strong quarter.




                                                                  Quarter Highlights

                                                                  28 deals | $206M

                                                                  Top Sector
                                                                    # of Deals – Internet
                                                                    $ of Funding - Internet

                                                                  Top Deals
                                                                   CrowdStrike
                                                                   Opscode
                                                                   Spoken Communications
                                                                   FinSphere
                                                                   Meteor Entertainment


                                                                  Top Cities
                                                                   Bellevue
                                                                     6 deals | $89M
                                                                   Seattle
                                                                     16 deals | $78M
                                                                   Kirkland
                                                                     1 deals | $26M
                                                                   Liberty Lake
                                                                     1 deals | $5M
                                                                   Issaquah
                                                                     1 deals | $3M
                                                                   Olympia
                                                                     1 deals | $3M




www.cbinsights.com
59                                              Venture Capital Activity Report | Q1 2012


Healthcare Loses Ground to Internet and Mobile & Telecom




                                                                                            Washington
Healthcare, which experienced an incredibly strong Q4 2011 in Washington, comes
back to earth as Mobile & Telecom grabs the #2 spot in terms of deals and dollars.




www.cbinsights.com
60                                                Venture Capital Activity Report | Q1 2012


Early Stage Investing Inches Backward, but Remains Strong




                                                                                              Washington
Seed and Series A lose a bit of ground, but still combine for over 50% of overall deal
volume and 33% of funding in Washington.




www.cbinsights.com
61                             Venture Capital Activity Report | Q1 2012




     Q1 2012 Venture Capital

     TEXAS




www.cbinsights.com
62                                               Venture Capital Activity Report | Q1 2012


Funding Falls, but Overall Texas See a Strong Quarter




                                                                                             Texas
Deal volume in Texas experiences a five-quarter high, while funding dips, but remains
strong.




www.cbinsights.com
63                                              Venture Capital Activity Report | Q1 2012


Healthcare Grabs Texas’ Top Spot




                                                                                              Texas
The merry-go-round continues in Texas with Healthcare owning the top spot this
quarter in terms of both deals and dollars.




                                                                Quarter Highlights

                                                                39 deals | $336M

                                                                Top Sector
                                                                  # of Deals – Internet
                                                                  $ of Funding – Healthcare

                                                                Top Deals
                                                                 Apollo Endosurgery
                                                                 Kinnser Software
                                                                 Pivot 3
                                                                 Bellicum Pharmaceuticals
                                                                 Glori Energy

                                                                Top Cities
                                                                 Austin
                                                                   21 deals | $201M
                                                                 Houston
                                                                   8 deals | $88M
                                                                 San Antonio
                                                                   3 deals | $22M
                                                                 Fort Worth
                                                                   1 deals | $10M
                                                                 Richardson
                                                                   1 deals | $6M
                                                                 Anna
                                                                   1 deals | $4M
                                                                 Dallas
                                                                   1 deals | $3M
                                                                 McKinney
                                                                   1 deals | $1M
                                                                 Plano
                                                                   1 deals | $1M
                                                                 El Paso
                                                                   1 deals | $1M




www.cbinsights.com
64                                               Venture Capital Activity Report | Q1 2012


Energy Registers Another Relatively Week Quarter




                                                                                             Texas
Texas, a state traditionally known as a hotbed for Energy investment, sees an
incredibly diverse quarter with Healthcare and Internet leading the way.




www.cbinsights.com
65                                               Venture Capital Activity Report | Q1 2012

Seed Continues to Gain Ground in Texas




                                                                                             Texas
Seed VC deal volume sees five-quarter high with 11% of overall deal volume.
However, Series A share of volume dips, netting overall drop in early stage deal share.




www.cbinsights.com
66                                                                     Venture Capital Activity Report | Q1 2012


Definitions – Ensuring Data Integrity
What’s Included in our Quarterly Venture Capital Numbers? What is not?

Given the importance of venture capital in spurring innovation and entrepreneurship, measuring venture capital activity
accurately is important. We encourage you to review the methodology and definitions employed by us to better
understand the numbers presented in this report. If you have any questions about our definitions or methodological
principles, we encourage you to reach out to us directly.


 What is included?                                              What is excluded?

• Equity financings into emerging companies.                    • Angel investment. These are not included in
  Funding must come from venture capital firms including          numbers unless an investment round included Angels
  corporate venture groups.                                       investing alongside a venture capital firm or corporate
• Fundings of only private companies. Public                      venture group.
  companies of any kind on any exchange (including Pink         • No contingent funding. If a company receives a
  Sheets) are excluded from our numbers even if they              commitment for $20M subject to hitting certain
  received investment by a venture firm(s)                        milestones but first gets $8M, only the $8M is included
• Companies must be headquartered in the USA. Our                 in our data.
  geographic data is based on the city and state where the      • No business development/R&D arrangements
  company receiving investment is headquartered. If a             whether transferable into equity now, later or
  company has a satellite office/presence in multiple cities      never. If a company signs a $300M R&D partnership
  or was founded in a particular city but has moved its HQ,       with a larger corporation, this is not equity financing
  our results reflect only this HQ address.                       nor is it from venture capital firms. As a result, it is not
• Only include the investment made in the quarter for             included.
  tranched investments. If a company does a second              • Buyouts, Consolidations and Recapitalizations.
  closing of its Series B round for $5M and previously had        All three of these of transaction types are commonly
  closed $2M in a prior quarter, only the $5M is reflected        employed by private equity firms and are tracked by
  in our results.                                                 CB Insights. However, they are excluded for the
• Round #s reflect what has closed – not what is                  purposes of this report. Private equity investments into
  intended. If a company indicates the closing of $5M out         companies which may have received venture capital
  of a desired raise of $15M, our numbers reflect only the        investment prior are also not included.
  amount which has closed.                                      • Private placements. These investments also known
• Only verifiable fundings are included. Fundings are             as PIPEs (Private Investment in Public Equities) even
  verified via (1) various federal & state regulatory filings     if made by a venture capital firm(s) are not included.
  (2) direct confirmation with firm or investor or (3) press    • Debt/loans of any kind. Venture debt or any kind of
  release.                                                        debt/loan issued to emerging, startup companies even
• Funding close date matters. Fundings are provided               if included as an additional part of an equity financing
  based on funding close date and not on announcement             is not included. If a company receives $3M with $2M
  date.                                                           from venture investors and $1M in debt, only the $2M
                                                                  is included in these statistics.
                                                                • Government funding. Grants, loans, equity
                                                                  financings by the federal government, state agencies
                                                                  or public-private partnerships to emerging, startup
                                                                  companies are not included. Strictly venture or
                                                                  corporate venture outfits.
                                                                • Incubator investments. Investments of money as
                                                                  equity or debt and/or services by incubators are not
                                                                  included.
                                                                • Strategic corporate investments. Corporations
                                                                  making strategic investments in companies but not as
                                                                  part of a specific organized venture group are not
                                                                  included.



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67                                                         Venture Capital Activity Report | Q1 2012


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68                                              Venture Capital Activity Report | Q1 2012


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Description: Q1 2012 Venture capital activity registered $5.9 billion invested in 785 companies.