Monday, November 6, 2017

Cooley, LLP on the State Of Venture Capital In Q3 2017

Our Cooley boilerplate:
Cooley is one of the big dogs of the VC legal eagle biz. Something like a third of the unicorns on the WSJ's Billion Dollar Startup Club list have used Cooley for one purpose or another.
Additionally, 20 or 21 of the companies on the "Technology Review's 50 Smartest Companies 2017" list have been represented or counseled by the firm. As I said, one of the biggies.
From Cooley:

Q3 2017 – Valuations Continue a Remarkable Climb
In the third quarter of 2017, there were slightly lower deal volumes but higher aggregate dollars raised as compared to the prior quarter. Compared to Q3 2016, we saw a 21% increase in deal volume and a 151% increase in aggregate dollars raised. In Q3 2017, Cooley handled 210 disclosable deals representing more than $5.3 billion of invested capital. When aggregated across industries, our data pointed to a continued increase in median pre-money valuations across all deal stages, with the exception of seed stage deals. A small number of very large, later stage deals in Q3 drove the average median pre-money valuation for Series D+ transactions to $750 million, a level not seen in over eight years. Cooley handled four disclosable deals in the quarter with median pre-money valuations greater than $1 billion.

Deal terms continued to be company-friendly. The percentage of deals with no participating liquidation preferences increased from 83% in Q2 to 86% of transactions in Q3. Additionally, we witnessed a decrease in the percentage of deals structured in tranches, with just 8% of transactions containing this structure.

GO Visualize (powered by Tableau)

Welcome to Cooley GO Visualize, which allows you to drill down on trends gleaned from deals we’ve worked on with entrepreneurs. The data you see here will be updated in conjunction with our quarterly VC Financing Reports. We hope you’ll find this and other Cooley GO resources such as the Convertible Note Term Sheet Generator and our guidance in Raise helpful in navigating and accelerating your fundraising efforts....

If interested, we last linked to the firm in August's "Cooley, LLP on the State Of Venture Capital In Q2 2017" and before that in February's Cooley Trends In Venture Capital: "Q4 2016 – A Solid Close to a Strong Year of Financings".