硅谷银行-2019年Q1风险投资市场报告-2019.2-33页.pdf

State of the MarketsInside Views on the Health and Productivity of the Global Innovation EconomyFirst Quarter 20192 2State of the Markets:First Quarter 2019As Good as it Gets?With all the dire headlines,lets not forget the epic run that venture has been on.Were now approaching a full decade of compounding tailwinds,with low rates and abundant capital bringing in risk-incentivized asset managers from around the globe.Weve only just begun harvesting this decade of innovation investing.Yet some investors are left pondering:Is this as good as it gets?For starters,it appears we have entered into a new era of higher volatility in public markets.Trade turmoil,anti-globalization rhetoric and fears of a slowing global economy are also giving investors pause.And the US is no longer alone in shaping the future of technology or regulating its changing landscape.But much of what got us here will take us further.After a decade of support from private markets,the caliber of IPO candidates approaching 2019 is unmatched.The unicorns of today have raised nearly 4x the historical average for venture-backed tech companies at IPO.And new opportunities continue to open for entrepreneurs,as technology takes hold in long-unaffected industries.So while acknowledging the risks coming into focus,we also know that change and disruption are inherent to the venture economy.Its what we do.No matter what the future holds,its unlikely that innovation will be stifled.Bob BleeHead of Corporate FinanceSilicon Valley Bank State of the Markets:First Quarter 20193 3State of the Markets:First Quarter 20194Predictions:SVBs 2019 Outlook for Venture5US Venture:A Decade of Capital9IPO Conditions:Ample Opportunities,Few Takers14Exit Readiness:The Unicorn Generation19Emerging Sectors:Disrupting the Old Guard 23Global Venture:International Exits Shine27Geopolitical Tensions:Technology in the CrosshairsState of the Markets:First Quarter 20194 4SVBs Outlook for Venture in 20192018 ThemesCategory2019 PredictionDeal countsat the early stages fell for another year from their 2015 highs.Capital remained robust,however;the median Seed deal size reached$2M for the first time.Early StageEarly StageWithoutthe robust pool of Seed-funded companies from years past,SVB anticipates another year of steady capital in the early stages,despite declining deal counts.Recordswere shattered at the later stages,with nearly 200 venture deals of$100M+in the US in 2018.Median pre-money valuations for Series D+crossed$300M.Late StageLate Stage2018could well be an anomaly for mega-round activity without renewed support from SoftBank or sovereign wealth funds.Expect valuations in aggregate to slide.International startups took advantage of calm markets and strong valuations to list in 2018.The US,however,still has$500B worth of unicorns on paper waiting to be realized.ExitsExitsIfthe marquee names in venture set a positive sentiment early,2019could represent the tipping point between demand for private and public capital at the late stage.US venture firms secured more than$50B in committed capital,the highest total since the dot-com era.43%went to funds of$1B+,like Sequoias$8B Global Growth III.FundraisingFundraisingThe velocityof US venture firms fundraising efforts foreshadows another big year for capital commitments.2019 should top$40B,even with a decrease from 2018.Corporates participated in one-in-six US VC deals in 2018,with new CVC groups forming in old guard industries facing disruption late in the economic cycle.CorporatesCorporatesIf stock prices(and management teams)remain stable,CVCs will remain heavily involved.Look for nearly 1,000 tech venture deals to have corporate participation.Sources:PitchBook,S&P Capital IQ and SVB analysis.State of the Markets:First Quarter 2019Records were broken in 2018 as both ventureRecords were broken in 2018 as both venture-backed companies and their investors stockpiled backed companies and their investors stockpiled private capital.Will this be the year we finally see exits for many of the highprivate capital.Will this be the year we finally see exits for many of the high-profile startups profile startups built during this decade of prosperity?built during this decade of prosperity?State of the Markets:First Quarter 20195 5US Venture:A Decade of CapitalSizeable Cash Piles as Bull Run Breaks Records 6 6Notes:1)VC and PE dry powder as of 3/31/2018 with SVB estimates for amount expected for tech investment.2)Vision Fund dry powder remaining as of year-end.3)Cash includes cash and ST and LT investments,net ST and LT debt.Sources:LPL Research,Yahoo,S&P Capital IQ,PitchBook and SVB analysis.A decade of prosperity following the recovery from the Global Financial Crisis has left both A decade of prosperity following the recovery from the Global Financial Crisis has left both traditional and emerging investors flush with cash for venture investing.traditional and emerging investors flush with cash for venture investing.Longest S&P 500 Bull Market Runs Since 1945Duration of Bull Market(Years)$64B$80B$44B$123B$115B$55B$41B$6B$0B$25B$50B$75B$100B$125BAccumulated Net Cash:12/31/2018US VC1US PE10%50%100%150%200%250%300%350%400%450%0123456789June 1949-Aug 1956Oct 1974-Nov 1980Aug 1982-Aug 1987Oct 1990-Mar 2000Oct 2002-Oct 2007Mar 2009-PresentDot-Com BubbleDry PowderSB VF2Net Cash3Potential to be Invested in TechLikely to be Invested in TechCurrentCurrentState of the Markets:First Quarter 20197 7US Tech Venture:Median Round Size by SeriesUS Tech Venture:100th Largest DealState of the Markets:First Quarter 2019Sources:PitchBook and SVB analysis.2018201620142012201020102012201420162018$32M$40M$25M$63M$74M$60M$70M$100M$0.5M$7M$3M$10M$2M$18M$8M$30MStartups Are Better Capitalized Than EverThanks to riskThanks to risk-incentivized investors and their buckets of cash,capital raises at every stage have incentivized investors and their buckets of cash,capital raises at every stage have more than doubled since the beginning of this decade.In fact,in order to make the top 100 deals of more than doubled since the beginning of this decade.In fact,in order to make the top 100 deals of 2018,a startup would need to have raised a nine2018,a startup would need to have raised a nine-figure round.figure round.Series C:3.0 x Series B:2.5xSeries A:3.2xSeed:4.0 x0.0%1.0%2.0%3.0%4.0%5.0%6.0%2006 2007 2008 2009 201020112012201320142015201620172018State of the Markets:First Quarter 20198 8As Rates Rise,Tourist Investors May Pull BackUS Federal Funds:Target RateUS Tech Venture:$50M+Rounds by Source of CapitalNote:1)Estimate of capital contributed by rate-sensitive investors,which include asset managers,mutual funds,hedge funds,government and sovereign wealth funds and family offices.Sources:S&P Capital IQ,PitchBook and SVB estimates and analysis.US interest rates have begun their measured climb back to historical norms,thus changing the riskUS interest rates have begun their measured climb back to historical norms,thus changing the risk-return profile for financial assets.If rate hikes continue,venture capital could see a pull back from return profile for financial assets.If rate hikes continue,venture capital could see a pull back from raterate-sensitive,latesensitive,late-stage investors like mutual funds,hedge funds,and sovereign wealth funds.stage investors like mutual funds,hedge funds,and sovereign wealth funds.2006200820102012201420162018$0B$10B$20B$30B$40B2006200820102012201420162018Capital from Interest Rate-Sensitive Investors1Capital from Traditional Venture SourcesState of the Markets:First Quarter 20199 9IPO Conditions:Ample Opportunities,Few Takers 1010Fewer IPOs Even in Calmer ConditionsSources:S&P Capital IQ,PitchBook and SVB analysis.0204060801/1/20061/1/20081/1/20101/1/20121/1/20141/1/20161/1/20180510151H062H061H072H071H082H081H092H091H102H101H112H111H122H121H132H131H142H141H152H151H162H161H172H171H182H1820062006200720072008200820092009201020102011201120122012201320132014201420152015201620162017201720182018VIX CloseIPO Count20S&P 500 Volatility Index(Daily)vs.US Venture-Backed Tech IPOs(Semiannual):20062018Historically,Historically,high volatility high volatility has slowed the pace of venturehas slowed the pace of venture-backed tech IPOs,which rely not only on backed tech IPOs,which rely not only on first day pricing,but also on maintaining lofty valuations after a sixfirst day pricing,but also on maintaining lofty valuations after a six-month lockmonth lock-up.But with up.But with abundant private capital,2016abundant private capital,2016 2017 was an anomaly with relatively few IPOs despite calm markets.2017 was an anomaly with relatively few IPOs despite calm markets.State of the Markets:First Quarter 2019Days Above 20:470US Tech IPOs:12 Days Above 20:14US Tech IPOs:48Days Above 20:42US Tech IPOs:29-100%-50%0%50%100%150%200%Zscaler,Inc.(NasdaqGS:ZS)Anaplan,Inc.(NYSE:PLAN)DocuSign,Inc.(NasdaqGS:DOCU)Avalara,Inc.(NYSE:AVLR)Pivotal Software,Inc.(NYSE:PVTL)Pluralsight,Inc.(NasdaqGS:PS)Eventbrite,Inc.(NYSE:EB)Dropbox,Inc.(NasdaqGS:DBX)SVMK Inc.(NasdaqGS:SVMK)Domo,Inc.(NasdaqGM:DOMO)Valuation Relative to Last Private Valuation1:2018 US$1B+Tech IPOs1111Market Cap:Square and SnapNote:1)LPV is last private valuation from a priced venture equity round prior to IPO.Sources:S&P Capital IQ,PitchBook and SVB analysis.State of the Markets:First Quarter 2019Public and Private Investors Seeing Eye-to-Eye+357%ZSPLANAVLRPVTLPSEBDBXSVMKDOMODOCU$0B$5B$10B$15B$20B$25B$30B$35B$40B2017201820172018Snap LPV1Square LPV1Public investors have largely agreed with private investors when it comes to unicorn valuations.Public investors have largely agreed with private investors when it comes to unicorn valuations.Seven of the top ten billionSeven of the top ten billion-dollar debuts in 2018 priced and remained above their last private round.dollar debuts in 2018 priced and remained above their last private round.The IPO is just the beginning,as evidenced by Snap and Squares reversal over the last two years.The IPO is just the beginning,as evidenced by Snap and Squares reversal over the last two years.Value at IPOValue at 12/31/201812122018 SaaS Listings Price Above 20162017“Rule of 40”1Metrics from 20162018 SaaS IPOsDespite similarities to the IPO cohorts of earlier years Despite similarities to the IPO cohorts of earlier years including negative operating margins and including negative operating margins and similar revenue growth similar revenue growth the class of 2018 softwarethe class of 2018 software-asas-a a-service companies fetched superior service companies fetched superior valuations in an improved market environment.Multiples remained locked to topline growth.valuations in an improved market environment.Multiples remained locked to topline growth.State of the Markets:First Quarter 2019Notes:1)The“Rule of 40”is a guideline developed in 2015 for software-as-a-service companies to manage growth(approximated by revenue)in sacrifice of profitability(approximated by operating margin).Growth rate+profitability should exceed 40%.2)Revenue run rate=Most Recent Quarters Revenue x 4.3)Most recent quarter relative to year prior.Sources:Company SEC filings,S&P Capital IQ and SVB analysis.0%10%20%30%40%50%60%70%80%90%100%-80%-60%-40%-20%0%Revenue GrowthOperating Margin(Loss)IPO Rev.Run Rate Multiple2vs.YoY Rev.Growth3y=16.84x+4.76R=0.63y=10.70 x+3.79R=0.610 x5x10 x15x20 x25x0%20%40%60%80%100%2018201820162016 2017 2017 Revenue Growth at IPOESTCAVLRESTCEBTWLOTWLOOKTAMULEEBMULEOKTASMARSMARAVLR0%20%40%60%80%100%1NeitherDebtBothEquity0510152025303520102012201420162018Follow-On Capital Raises by Type:20102018 US Tech IPO Cohort11313Post-IPO Convertible Debt Raises by Year of Issuance:IPO Cohort1Percentage of IPO Cohort1to Have Completed Follow-On over TimeNote:1)IPO Cohort includes all venture-backed technology IPOs from 20102018.Sources:S&P Capital IQ,PitchBook and SVB analysis.State of the Markets:First Quarter 20190%20%40%60%80%100%123456The What,When and How of Post-IPO Capital RaisesOne of the primary benefits for publicly listed companies is permanent access to capital,whether in One of the primary benefits for publicly listed companies is permanent access to capital,whether in the form of additional equity or debt.2018 saw a flurry of recently listed companies opt for a the form of additional equity or debt.2018 saw a flurry of recently listed companies opt for a combination combination convertible debt issuances convertible debt issuances which raised more than$12B.which raised more than$12B.IPO+1 Yr.+2+3+4+5State of the Markets:First Quarter 20191414Exit Readiness:The Unicorn Generation1515Expect IPOs to Continue Their Capital ClimbMedian Equity Raised Prior to IPO and via IPO by US Venture-Backed Tech CompaniesBefore the flurry of private capital began in 2015,the average ventureBefore the flurry of private capital began in 2015,the average venture-backed tech company would backed tech company would raise$100M in private capital ahead of their$100M public offering.Looking at the current crop of raise$100M in private capital ahead of their$100M public offering.Looking at the current crop of US unicorns,more than 90%have already raised at least$100M in a single private financing.US unicorns,more than 90%have already raised at least$100M in a single private financing.Percentage That Raised a Private Venture Round of$50M+and$100M+Prior to IPOState of the Markets:First Quarter 2019Sources:CBInsights,PitchBook and SVB analysis.$0M$100M$200M$300M$400M201020122014201620182019Current US Unicorns0%25%50%75%100%201020122014201620182019Current US UnicornsCapital Raised Prior to IPOCapital Raised at IPO$50M+Round$100M+RoundUS Tech IPOs1:LTM2Rev.at IPO1616Revenue Growth Rates(YoY3)Percentage Profitable2at IPONotes:1)IPO cohort includes all venture-backed technology IPOs.2)Last 12 months prior to IPO date.3)Most recent quarter relative to year prior.Sources:PitchBook,S&P Capital IQ and SVB analysis.State of the Markets:First Quarter 2019Revenue Climbs,But Other Fundamentals Slide$85M$85M$185M$185M$0M$50M$100M$150M$200M$250M201020122014201620180%10%20%30%40%50%60%70%80%201020122014201620180%10%20%30%40%50%60%70%80%90%100%20102012201420162018With an abundance of capital at their disposal,ventureWith an abundance of capital at their disposal,venture-backed startups have more than doubled backed startups have more than doubled their average revenue base at IPO this decade.However,this scaling has come at the expense of their average revenue base at IPO this decade.However,this scaling has come at the expense of profitability and few have demonstrated significantly higher revenue growth at their debut.profitability and few have demonstrated significantly higher revenue growth at their debut.Middle 50%MedianEBITDAEBITNet IncomeMiddle 50%Median0 02 24 46 68101012+12+1717Note:1)Only includes US unicorns with valuations$3B+;logos represent valuations$5B+.Sources:PitchBook,CBInsights,The Wall Street Journal,S&P Capita