2016


Best Investment in start-ups since the dot-com boom

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U.S. Venture Capital firms have raised $12.0Billion for 57 funds during the first quarter of 2016 translating into a 59% increase in dollar terms from last year´s first quarter and a 17% decrease in terms of the number of funds raised, according to the National Venture Capital Association (NVCA). This quarter investments has marked the best start to a year since the dot-com boom in 2001 and the strongest quarter since the 2nd quarter of 2006 when 79 funds raised $14.3Billion.

What is worth reflecting on is that the market considered 2015 to be the worst year for Tech IPOs since 2009: just 28 companies entered the U.S. public markets according to Dealogic compared to 62 in 2014 and 48 in 2013, 131 unicorns (companies valued at $1Billion or more by Venture Capitalists such as Uber, Xiaomi and Airbnb) opted to remain private for a longer period and half of the tech companies that went public have traded at below their IPO price.

Regardless, this data is surely good news for the Venture Capital industry that managed to gather the most money in a decade, money which will eventually need to get invested into American entrepreneurs businesses thus encouraging innovation.

Lyft, the American transportation network company that facilitates peer-to-peer ridesharing, completed a $1Billion financing round, seizing the largest deal of the quarter. Following, is the 3D computer-generated virtual reality start-up Magic Leap that raised $794Billion, and rounding the top 5 are Sunnova Enegry, Uber and Flatiron Health. The top 10 companies have raised 25% of total funds.

In terms of sectors, the most attractive was Software which gathered $5.1Billion, Biotechnology raised $1.8Billion whereas Media and Entertainment came in 3rd place with $930Million. More experienced start-ups were more successful in gaining more flows while early stage investments decreased by 18% in volume compared to the previous quarter.

 

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