Venture Pulse Q3 2017 | KPMG | IE

Global VC investment remains strong – KPMG Venture Pulse Q3 2017

KPMG Venture Pulse Q3 2017

The Q3 2017 edition of the Venture Pulse report produced by KPMG analyses the latest global trends in venture capital investment data and provides insights from both a global and regional perspective.

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KPMG Venture Pulse Q3 2017

Global VC investment remains strong – KPMG Venture Pulse Q3 2017

  • Fewer deals in Ireland in the year to date, but deals of higher value
  • 2017 trending to be the second best year of the decade in Ireland for VC investments

KPMG has published its Venture Pulse Q3 2017 report, tracking venture capital activity around the globe. Speaking about activity in the Irish market, Anna Scally, Partner, Head of Technology, and Media and Fintech Lead at KPMG in Ireland, said “In the first three quarters of 2017, Irish companies raised venture funding amounting to $462.44m – broadly in line with the position after three quarters last year. However, in line with the trend we are seeing globally, the average deal size was a lot larger with 71 companies being funded in the first three quarters of the year, versus 103 at this point last year. In this quarter specifically, $151.6m was raised by 11 companies. They included Future Finance, the Dublin based student specialist lender, who raised $58m. Cubic Telecom, which provides a global M2M connectivity platform, also raised $47m in the quarter. Pointy, a very exciting early stage company, which enables local retailers get their products online immediately, raised its Series A of $6m.

“By engaging in late-stage investment, VCs appear to be genuinely interested in building sustainable companies of scale. This is perhaps a change to the traditional model. It’s quite an exciting shift as its leading to a slate of larger, more sustainable VC-backed companies.” said Anna Scally.

Key KPMG Venture Pulse Q3’17 Global Highlights

  • Overall Global VC investment remains strong at $39.4 billion in Q3’17, holding strong with the number of mega-deals making up the top 10 list this quarter.
  • Global median deal size at every stage remained high. Median Series D+ deal pre-money valuation surges to $260 million in 2017 to date.
  • Corporate venture capital investment as a percentage of deal count remained high at 17.7 percent and is expected to stay strong through Q4’17 into 2018.
  • Global first-time venture financings were well off last year’s pace, declining from 5,142 deals and $17 billion in funds in 2016 to 2,736 deals and $9.7 billion so far in 2017.
  • Funding for the VR/AR sector has already surpassed 2016 totals ($1.56 billion) in the first three quarters of 2017, which saw $1.645 billion dollars in VC investment. This space is on track to explode in 2018.

 

Total venture capital investment globally reached US$39 billion in Q3’17, the fourth highest quarterly total capital invested since 2010, according to KPMG’s Venture Pulse Q3 2017. While total investment remains strong, the total number of deals dropped yet again, reaching levels not seen since 2011 as investors around the world continued down a disciplined path of investing, placing fewer bets on angel and seed round opportunities, and deploying higher amounts of capital to a more select group of companies. Following in the footsteps of Q2’17, the US continues to dominate VC investment, accounting for $21.5 billion, followed by Asia ($12.3 billion) and Europe ($4.7 billion).
 

Global trends reflected in Europe

The low volume, high valuation phenomenon continues in Europe, where the number of deals continues to drop, particular for early stage investments. Investors are becoming particularly selective with their funding options and are opting to back late-stage initiatives. This move is boosting the median value of these late- stage deals, as can be seen in the number of $100 million+ ventures. The UK bucked this trend, recording a near record $1.9 billion in capital invested. While deal volume continued to decline in concert with overall trends, several large financings boosted the UK to a stellar quarterly investment total. The top four European deals during Q3’17 combined for a total of more than $900 million dollars –with $385 million to Deliveroo, $240 million to Prodigy Finance, $169.5 million to Sound Cloud, and $165 million to Tricentis.

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About Venture Pulse

The Q3 2017 edition of the Venture Pulse report produced by KPMG analyses the latest global trends in venture capital investment data and provides insights from both a global and regional perspective.

*Note: all figures cited are in USD; data for the report provided by PitchBook.

For further information, contact:

Kelli O'Malley
Communications Manager, KPMG Ireland
kelli.omalley@kpmg.ie; (01)700 4169

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