Mega-rounds continuing to propel VC activity

Mega-rounds continuing to propel VC activity

In Q3’15, Asia led global mega-round deals activity compared to the US, Europe and other markets.

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As part of our Q3 Venture Pulse Report, developed in association with CB Insights, a global trend was noted; many VC investors continued to focus on bigger and bigger deals. In fact, during Q3-2015, the report found that large scale mega-rounds included over 60 rounds of funding over (RC) US$100 million and 10 rounds of funding over US$500 million. 

Asia led global mega-round deals activity compared to the US, Europe and other markets – primarily driven by VC investments in On Demand and e-Commerce companies. China-based Didi Kuadi led VC investment in the quarter – both in Asia and globally – bringing in over $3 billion (Series F funding) during two funding rounds. Didi Kuadi is a taxi hailing company targeting significant growth in the Asia Pacific region. Other significant mega-rounds in Asia went to Ele.me (US$630M – Series F) – a food delivery service in China, Snapdeal (US$500M – Corporate Minority) – an e-Commerce website based in India and GrabTaxi (US$350M – Series F) – a Singapore-based company managing a location-based taxi booking and dispatch app that caters to people primarily in Southeast Asia. 

Part of Asia’s attractiveness may be the result of VC investors looking at the region as a high growth market for disruptive business models that have quickly saturated the US and North American markets – such as food delivery and on demand companies, several of which received significant funding in Q3. 

At the same time, VC investors in North America are focusing more on identifying the next big industries ripe for disruption. A few examples include California–based Social Finance – a fin-tech company working to disrupt the lending models of big banks by offering student, personal and home loans that raised $1 billion in Series E funding and Palantir Technologies – a California based data and analytics company that raised $450 million in series I-II funding. 

In Europe, one of the top mega-rounds went to UK based Immunocore – a biotech firm focused on innovative cancer treatments – which raised US$320 million in Series A funding. Immunocore is a strong example of an emerging VC trend toward investments in biotech and health tech companies.

Looking forward, we expect this trend toward mega-round financing to continue for the next several quarters, especially with respect to late-stage mega-deals. For more information and insights into the global trend toward bigger and bigger deals, visit our Venture Pulse Report website.

 

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About the author

Tim Dümichen, Partner, KPMG in Germany

Since June 2008, Tim Dümichen has been working as a Partner in the Corporate Tax Department. He is also the head of the KPMG Enterprise Global Innovative Startups Network in Germany and provides services to more than 50 start-up companies. Among Tim’s clients are: SoundCloud Limited and Delivery Hero Holding Group.

Venture Pulse Blog

Blog series covering topics related to venture capital investment globally.

 
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Venture Pulse

Quarterly global report on VC trends published jointly by KPMG International and CB Insights.

 
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