US VC deal activity: Pwc report

US VC deal activity declines in Q1’20, but mega-rounds drive increase in funding US VC deals fall for the third consecutive quarter in Q1’20: Deal activity for US VC-backed companies falls 9% QoQ and 16% YoY. In March 2020, US deals decrease 22% YoY, with some of the decline likely attributable to the earlier COVID-19 pandemic.

Nonetheless, funding still rises 14% QoQ on the back of larger deals. . Nearly half of all US funding in Q1’20 comes from megarounds: Despite a slowdown in deals at the end of the quarter, 58 US companies raise rounds worth $100M or more in Q1’20, close to the record of 67 in Q2’19.

21 of these rounds took place in March 2020, suggesting COVID19’s impact may become more apparent in Q2’20.

The number of unicorn companies reaches a new high, but aggregate valuation is falling: The number of VC-backed startups valued at $1B+ continues to rise, hitting 204 private companies in Q1’20. However, aggregate valuation dips for the second consecutive quarter, to $624B.

Geographic Insights

Global deal activity and funding see YoY declines North America, Asia, and Europe see combined funding of $50B in Q1’20: Global VC funding falls 10% in Q1’20 compared to Q1’19. Asia sees the largest drop in funding, deal activity: Asia deal activity declines 20% YoY, compared to declines of 17% in North America and 10% in Europe, with some of the decline likely attributable to the earlier outbreak of COVID-19 pandemic.

Funding to startups in Asia falls 19% YoY. Atlanta, St. Louis, and Boston Metros hit eight-quarter highs for funding activity: Atlanta Metro funding increases to $540M in Q1’20, driven by two $200M+ mega-rounds, while St. Louis Metro funding reaches $412M. Boston Metro sees a 19% YoY increase in funding, rising to $3.5B.

The largest deals in the US all come from Silicon Valley: Despite a 12% YoY decrease in deal activity, the top five funding rounds in the US are all Silicon Valley startups that raised $450M+ each.

Q1’20 mega-round investments are off to a strong start Mega-rounds – Quarterly seasonality

US VC deal activity declines for the third consecutive quarter US deals and dollars – Quarterly

Deal activity in 2020 off to slowest start since Q1’13 US deals and dollars – Annual

45% of all deals in Q1’20 were mega-rounds Mega-rounds – Funding and share of deals

Internet startups continue to receive outsized financing Deals and dollars – US sectors

Total value of US unicorns dips despite 12 new unicorn births Unicorns – US aggregate unicorn valuation

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