NVCA Data for VC Fundraising, M&A Markets and IPOs Released

The National Venture Capital Association (NVCA) released its data, available on its website, on VC fundraising and liquidity events for Q4 2011 and 2011 as a whole. The data showed another solid year in mergers and acquisitions and consistency in VC fundraising and an up-and-down year in initial public offerings with a glimmer of hope in Q4 IPO data.

In 2011, 169 venture capital funds raised $18.17 billion, which is a 32% increase compared with 2010. In Q4 2011, only 38 venture capital funds raised money (compared with 48 venture capital funds in Q4 2010), the lowest by quarter since Q3 2009. The trend of first-time fundraisers representing the greater percentage of total funds continued in 2011, with 29% of all funds being first-time fundraisers, compared with 30% in 2010, 24% in 2009 and 23% in 2008.

Fifty-two venture-backed companies went public in 2011, down from 75 in 2010, but up appreciably from the dog years of 2009 (12) and 2008 (6). Some would point to the average offer amount of $190 million, up from $101 million in 2010, as a real bright spot, but the average offer amount has been fairly volatile the last few years ($136 million, $78 million, $120 million and $89 million in 2009, 2008, 2007 and 2006, respectively) and the blockbuster Yandex and Zynga offerings likely inflated the 2011 average.

The NVCA also points out that the 11 Q4 2011 IPOs give hope for 2012, after only 5 IPOs in Q3.  Although admittedly small sample sizes, in both 2009 and 2010 there were also high numbers of offerings in Q2 and Q4, so the Q4 2011 performance may be a result of the seasonal business cycle rather than true improvement (although one can always hope).

The 2011 data tells a much more consistent growth story in the M&A markets. The total number remained consistent at 429 venture-backed M&A deals, as compared to 436 in 2010, and the average M&A deal size rose to $150 million in 2011 from $145 million in 2010. These numbers continue the upward climb from 2009 (273 deals, average deal of $136 million) and 2008 (348 deals, average deal of $116 million) and represent the rosiest of the data sets.

This post was authored by Founders Workbench.

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