VOLUME 13, ISSUE 8 ■ NOVEMBER 2017 alternative assets. intelligent data. PRIVATE EQUITY & VENTURE CAPITAL SPOTLIGHT WOMEN IN VENTURE CAPITAL IN THIS ISSUE 21% of all venture capital employees are female. We focus on women-led venture capital fundraising and deal activity, and highlight recent developments in the industry, including Reid Hoffman’s #DecencyPledge movement FEATURE 3 amid recent sexual misconduct allegations. Women in Venture Find out more on page 3 Capital FEATURE 8 Compensation and Employment COMPENSATION AND INDUSTRY NEWS 10 EMPLOYMENT THE FACTS 78% ■ Japan-Based Private 12 of surveyed private capital firms increased the average Equity Investors firm-wide base salary in 2016/2017, and another 68% project a further increase in 2017/2018. ■ Venture Capital Fund 13 Performance Find out more on page 8 ■ Raising Private Equity 14 Funds of Funds ■ India-Based Deals and 15 Exits CONFERENCES 16 RECENTLY RELEASED: THE 2018 THE 2018 PREQIN PRIVATE PREQIN PRIVATE CAPITAL COMPENSATION AND EMPLOYMENT REVIEW CAPITAL COMPENSATION AND In association with: All data in this newsletter alternative assets. intelligent data. can be downloaded to EMPLOYMENT REVIEW Excel for free Order Your Copy Download Sample Pages Sign up to Spotlight, our free monthly newsletter, providing insights into performance, investors, deals and fundraising, powered by Preqin data: Alt Credit Intelligence European and US Fund Services Awards: Best Data and Information Provider | Africa Global Funds Awards 2016: Best Research and Data Provider | The Queen’s Award for Enterprise: International Trade | HedgeWeek Global Awards: Best Global Hedge SIGN UP Fund Research Provider | CAIA Corporate Recognition Award www.preqin.com/contact | [email protected] Global private equity fundraising Capstone Partners (www.csplp.com) is a leading independent placement agent focused on raising capital for private equity, credit, real assets and infrastructure firms. The Capstone team includes 35 experienced professionals in North America, Europe and Asia. Platte River Equity We congratulate the Platte River Equity team on the first and final closing of Platte River Equity IV, L.P. at its hard cap. www.csplp.com Americas — Europe — Middle East — Asia Pacific Securities placed through CSP Securities, LP Member FINRA/SIPC Authorised by FINMA WOMEN IN VENTURE CAPITAL WOMEN IN VENTURE CAPITAL Expanding on data featured in Preqin’s recently released Women in Alternative Assets report, we focus on women-owned venture capital firm activity and look at the recent developments and reactions regarding initiatives to improve the gender imbalance and misconduct allegations. ollowing recent allegations of Fig. 1: Annual Venture Capital Fundraising by Women-Owned Firms, 2007 - 2017 YTD Fdiscrimination within the venture (As at October 2017) capital industry, the issue of gender 30 3 balance has received renewed attention. 25 Raised Capital ($bn) Aggregate Women represent a mere 21% of all 25 24 2.4 venture capital employees, with the 2.1 largest proportion (36%) of women in 20 18 2 1.8 venture capital in junior-level positions, 1.5 15 15 13 followed by 29% in mid-level positions 12 12 1.0 and 11% in senior-level positions. The 9 9 10 8 1.0 1 proportions of female board members 7 No. of Funds Closed of Funds No. 0.8 0.6 are even smaller: just 6% of all venture 5 0.7 0.6 capital board representatives are women. 0.3 Geographically, the ratio of total women 0 0 employees in the industry lingers at around 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 YTD a fifth across all regions, although North Year of Final Close America has a greater percentage (13%) No. of Funds Closed Aggregate Capital Raised ($bn) of women in senior positions compared to Europe (9%). In this feature, we look at the Source: Preqin Venture Capital Online members of the industry working to raise industry standards of conduct, the impact capitalists have sounded a call for action. First Round Capital and General Catalyst of women deal-makers, the relationships of Reid Hoffman, LinkedIn co-founder and Partners, some in the industry argued institutional investors with women-owned partner at Greylock Partners, suggested that moral decency should not have to firms and women-led fundraising activity. that those in the industry adopt a set of be pledged, and others argued that the moral guidelines, which he has dubbed pledge alone is not enough to motivate DECENCY PLEDGE the “decency pledge”. While many firms change in the industry. In the wake of recent sexual misconduct quickly adopted the pledge, such as allegations, many prominent venture Sequoia Capital, Norwest Venture Partners, Fig. 2: Largest Women-Owned Venture Capital Funds in Market (As at October 2017) Primary Fund Target Fund Firm Vintage Type Geographic Focus Status Size ($mn) Baidu Capital Baidu Capital 2017 Expansion/Late Stage Asia First Close 2,950 AMBI Film Fund AMBI Pictures 2017 Venture Capital (All Stages) US Raising 200 Arbor Ventures Fund II Arbor Ventures 2017 Early Stage: Start-up Asia First Close 200 Ariadne Ecosystem Economics Fund Ariadne Capital 2017 Venture Capital (All Stages) Europe Raising 195 Aspect Ventures Fund II Aspect Ventures 2017 Early Stage US Raising 175 Glasswing Ventures Glasswing Ventures 2017 Early Stage US First Close 150 Hummer Winblad Venture Partners VII HWVP 2017 Venture Capital (All Stages) US Raising 125 iBionext Growth Fund iBionext 2016 Early Stage: Start-up Europe First Close 111 Agent Capital Fund I Agent Capital 2017 Venture Capital (All Stages) US Raising 100 iGlobe Platinum Fund II iGlobe Partners 2015 Early Stage Asia First Close 100 Imaginary Venture Capital Partners I Imaginary Ventures 2017 Early Stage Europe Raising 100 Nautilus Venture Partners Fund I Nautilus Venture Partners 2015 Venture Capital (All Stages) US First Close 100 Venture City Fund I Venture City 2017 Early Stage: Start-up US Raising 100 Source: Preqin Venture Capital Online 3 Private Equity & Venture Capital Spotlight | November 2017 © Preqin Ltd. 2017 / www.preqin.com WOMEN IN VENTURE CAPITAL The pledge states that when venture and entrepreneurs should not consider the way to a more inclusive and diverse capitalists are engaging with their funding offers. industry. XFactor Ventures, a pre-seed entrepreneurs, they have the same and seed stage fund, was created to help moral position to them as a manager to One example of this pledge in action make a difference for the next generation an employee or a college professor to a can be found in Y Combinator’s (YC) of female-led businesses. The firm has student. Moreover, once potential business long-standing tracking of investors eight female founders and nine female relationships are underway, the pursuit of with a history of poor conduct within investment partners, and has raised $3mn any romantic or sexual relationship must the YC network, known by some as the to make pre-seed and seed investments be forfeited. The pledge also maintains “Silicon Valley Blacklist,” and its more in 30 female-led companies over the next that industry peers have a duty to report recent anonymous submission system couple of years. XFactor Ventures is one of behaviour that is not up to standard and for YC network founders to report any the few firms in the industry that strives to that gender discrimination should be misconduct they have experienced have female representation on both the treated with zero tolerance; that fellow personally, observed themselves or been investment and founder side. venture capitalists should not do business told as a confidant of a victim. with peers who engage in discriminatory BBG Ventures is another example of a or predatory behaviour; and that WOMEN DRIVING CHANGE firm founded on the principles of driving institutional investors should not invest By incorporating gender diversity values and developing female talent in the with those particular individuals or firms, into their business models, firms are paving industry. Founded by Susan Lyne, the early Fig. 3: Most Active Female Board Representatives at Venture Fig. 4: Proportion of Venture Capital Deals Led by Female Capital-Backed Portfolio Companies, 2017 YTD Partners, 2010 - 2017 YTD (As at October 2017) No. of Board 10% Name Firm(s) 9.0% Seats 9% Cindy Padnos Illuminate Ventures 11 8% 7.2% Vani Kola Kalaari Capital 10 6.9% 7.1% 7% 6.4% 6.7% Hilary Gosher Insight Venture Partners 10 6.1% 6% SV Health Investors, Roche Venture Tracy Saxton 9 5% Fund, Pivotal BioVenture Partners 4% Wende Hutton Canaan Partners 9 of DealsProportion 3% Jenny Lee GGV Capital 8 2% Elaine Jones Pfizer Venture Investments 8 1% Dana Settle Greycroft Partners 7 0% Nilanjana Bhowmik Longworth Venture Partners 7 2010 2011 2012 2014 2015 2016 2017 YTD Stacey Bishop Scale Venture Partners 7 Source: Preqin Venture Capital Online Source: Preqin Venture Capital Online Fig. 5: Venture Capital Deals Led by Female Partners, Fig. 6: Women-Owned Venture Capital Firms: Deals by Portfolio 2010 - 2017 YTD (As at October 2017) Company Location (As at October 2017) 350 6 400 5 366 4.6 307 350 4.5 300 286 5.1 ($bn) Value Deal Aggregate 276 5 ($bn) Value Deal Aggregate 4 249 300 250 3.5 224 4 4.4 250 3.7 190 3 200 177 176 2.9 3 200 2.5 150 2.9 2.9 2.9 2 No. of Deals No. 150 2.0 2 of Deals No. 100 1.5 100 76 0.7 0.9 1 50 1 43 50 25 0.2 0.5 0 0 0 0 2010 2011 2012 2013 2014 2015 2016 2017 North America Europe Asia Rest of World YTD Location No. of Deals Aggregate Deal Size ($bn) No. of Deals Aggregate Deal Value ($bn) Source: Preqin Venture Capital Online Source: Preqin Venture Capital Online 4 Private Equity & Venture Capital Spotlight | November 2017 © Preqin Ltd.