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Laxman Pai, Opalesque Asia: Following a strong 2019, venture capital deal flow in the US slowed in Q1 2020 as COVID-19 introduced practical challenges for dealmakers, said a study.
A total of 963 deals were completed in the US for an aggregate $27bn in Q1 2020, a 19% decline from 1,191 deals in Q1 2019, said a study by Preqin and the First Republic.
"With social distancing and travel restrictions imposed across the US to contain the spread of COVID-19, many business meetings were canceled," the report pointed out.
Despite the slowdown in activity, some large deals were still completed in Q1. The five largest transactions accounted for 23% ($6.1bn) of the aggregate value of venture capital deals in the quarter.
These included the $2.25bn financing round held by Waymo LLC, a developer of self-driving car technology which began as the Google Self-Driving Car Project in 2009.
Early-stage investments (Series A and earlier) accounted for half of all venture capital deals completed in the US in Q1 2020. Series B and Series D and later investments constituted the joint largest share (21%) of aggregate deal value among financing rounds.
Information technology was the most active industry for US-based venture capital investment in the quarter, representing 54% of all deals and 40% of total deal value.
Exit activity increases compared with the prior year
In Q1 2020, there were 147 venture capital-backed exits for US-based companies, valued at an aggreg...................... To view our full article Click here
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