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Preqin Industry News

Venture capital funds had greater success at achieving, or surpassing, their initial target size in 2015, than at any point since 2006. Oliver Senchal takes a look at the latest news stories for venture capital funds closed and deals completed.

Venture Capital Fundraising Chart of the Month

The $51.1bn raised by venture capital funds in 2015 was Average Proportion of Target Size Achieved by Venture a post-crisis record for the strategy, surpassed only by the Capital Funds at Final Close, 2006 - 2016 YTD (As at 28 $52.6bn raised in 2008. Interestingly, only 337 venture capital January 2016) funds reached a ﬁ nal close – the lowest total since 2011 (324) and a noticeable decline compared with the 386 funds closed in 2014. This is in line with trends seen across the private capital 120% 114% landscape; relatively high amounts of capital were secured 102% 101% 103% by a lower number of vehicles reaching a ﬁ nal close, and 100% 97% 95% 97% 91% 91% 90% subsequently the average size of venture capital funds reached 82% a record high in 2015 ($180mn) – 18% higher than 2014. 80%

Furthermore, venture capital funds have been securing a larger 60% proportion of their initial targets at fi nal close, with funds closed in 2015 securing an average of 103% of their target size. Eleven 40% venture capital funds have closed in 2016 so far, securing an average of 114% of their initial target sizes. Among these, 20% Rocketship.vc Fund I reached a fi nal close in January, raising $40mn from investors and surpassing its $25mn target. The 0% fund seeks to make early stage venture capital investments in Size Achieved Proportion of Target Average 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 companies within the data science sector. YTD Year of Final Close Also reaching a fi nal close last month and surpassing their Source: Preqin Private Equity Online initial targets were iNovia IV and Sierra Ventures XI. iNovia IV secured 117% of its initial CAD 150mn target for start-up investments in the internet, digital media and communications Venture Capital Funds in Market industries, while Sierra Ventures XI secured 113% of its $150mn target for early stage investments in the telecom, technology There are currently 759 venture capital funds on the road, and communications sectors across North America and Asia. collectively seeking over $84bn in capital commitments from institutional investors. The largest of these, Invention Investment Venture Capital Deals Fund III, is targeting $3bn to make seed investments in US inventions and technologies that are at a particularly early stage of development. The largest primarily Europe-focused In January 2016, China-based e-commerce company Meituan- venture capital fund is Rocket Internet Capital Partners Fund, Dianping confi rmed that the fi rm raised $3.3bn of funding from targeting €1bn (c. $1.1bn) for late stage investments in internet DST Global, Trustbridge Partners, CPP Investment Board, businesses. The fund held a fi rst close in January 2016, Baillie Gifford, Sequoia Capital, Hillhouse Capital Management, securing 38.5% of its target size. China Development Bank Capital, Capital Today, Temasek Holdings, Tencent and other unspecifi ed investors. The round Targeting CNY 10bn (c. $1.5bn), SummitView IC Industry Fund values the company at $18bn. invests in global integrated circuit and semiconductor design companies, in an effort to help them expand their market Other large fi nancings last month included China-based portfolio share in China. Vital Capital Fund II is the largest fund focused companies, including the $1.216bn series B funding of fi nancial outside North America, Europe and Asia, targeting $500mn for services fi rm Shanghai Lujiazui International Financial Asset investment across a diverse range of industries in Sub-Saharan Exchange by COFCO Limited, Guotai Junan Securities, Bank Africa including agriculture, education, water, affordable of China Group Investment, China Minsheng Banking Corp and housing, healthcare and clean energy. The fund is managed by other unspecifi ed investors. JD Finance raised CNY 6.65bn in Switzerland-headquartered Vital Capital Investments. series A fi nancing (c. $1bn) from Harvest Fund Management, Sequoia Capital and Taiping Life Insurance. Do you have any news you would like to share with Outside China, US-headquartered Lyft, Inc. completed its the readers of Spotlight? Perhaps you’re about $1bn series F fi nancing round, with a $752.3mn investment to launch a new fund, have implemented a new from General Motors, Janus Capital Group, Rakuten Inc., Didi investment strategy, or are considering investments Kuaidi and Alibaba Group. UK-based Skyscanner Ltd. raised beyond your usual geographic focus? $192mn in funding from Artemis Ventures, Baillie Gifford, Khazanah Nasional Berhad, Scottish Equity Partners, Sequoia Capital, Vitruvian Partners and Yahoo Japan Corporation. Send your updates to [email protected] and we will endeavour to publish them in the next issue.

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