By Rob Starr, Big4.com Content Manager
The MoneyTree™ Report by PricewaterhouseCoopers and the National Venture Capital Association based on data from Thomson Reuters highlighted a significant uptick in total investing in Q2, with the overall Venture Capture Investing eclipsing anything seen since Q4 2000 and Software capturing $7.3 billion.
Adding to the increasing momentum, there were 26 mega deals of $100 million or greater and another billion dollar investment that has been a high-water mark in four of the last five quarters with other deals reaching that lofty monetary amount.
Tom Ciccolella, US Venture Capital Leader at PwC, walked us through the findings.
“People like to say that Software is eating the world,” he said, “and I like to add it’s certainly
eating the MoneyTree Report.”
It’s a pattern that has been building thrust for some time. In fact, not only are these Software firms carrying on with the business of disrupting entrenched companies, in some cases they are creating new industries all together . The 30% increase in venture capital investment from the first quarter highlights the expectation that this juggernaut won’t be stopped anytime soon.
Ciccolella stresses that while the dollar amounts are usually the metric that grabs the headlines, the number of deals is an often overlooked set of markers that are just as critical.
“From my perspective, we’re at a good spot in terms of the number of deals,” he says adding the results are consistent with other quarters and that the bump that’s getting noticed in Q2 is fueled by other factors.
“I think there’s a couple of things that weigh in there. Predominantly, there’s the advent of the big or mega deal that’s anything over one hundred million dollars.”
Although AirBnb, Inc. was at the center of the biggest of the deals at $1,500,000,000 dollars, there were the usual suspects in Software like a Snapchat, Inc. and DocuSign, Inc. that were involved in these aforementioned multimillion dollar transactions. Ciccolella is quick to point out there were 26 of these deals in Q2 compared to 12 in the previous quarter and this trend that started in late 2013 or even early 2014, skewers the overall numbers.
“You’re talking about big dollars pushing up the overall dollars,” Ciccolella says.