Cooley Announces Banner Year for Venture Financing Transactions

Palo Alto – February 19, 2015 – Cooley has published its 2014 Venture Financing Report. The firm has publicly disclosed data from 540 of the financings on which it advised clients. Collectively, those transactions represented more than $9.5 billion of invested capital. Both the quantity of transactions and the collective dollars invested represented volumes not seen since the inception of the firm's Venture Financing Report over seven years ago. Powered by Tableau, the full report and other curated data can be viewed through the Cooley GO website.

A further analysis of the results yielded the following trends that have continued into 2015:

  • There was an increase in median pre-money valuations across all deal stages in 2014. Median valuations reached levels not seen in more than six years. Valuation increases were most pronounced in Series A deals, where median pre-money valuations hit $15 million in 2014. Series B transactions saw median pre-money valuations increase to $38 million. 
  • Series A transactions made up 44% of all financings in 2014, which was the highest level in more than six years. Cooley noted that a driver of this increase was the broader mix and sources of Series A funding available to entrepreneurs.
  • The percentage of up versus ?at/down rounds hit historical highs in 2014, as more than 80% of financings were up rounds.
  • During the year, basic deal terms reflected a company-friendly environment. The percentage of deals with a liquidation preference of 1x or less increased across all deal stages. The percentage of recapitalization transactions dropped to just 5% of deals during the year, and deals structured in tranches decreased to just 11% of transactions.

"The data graphics created by Tableau clearly depict the tremendous financing successes that growth companies had in 2014," said Craig Jacoby, partner and chair of Cooley's emerging companies group. He added that, "Cooley continues to see steady deal flow in Q1 of 2015."

A PDF version of the report can be viewed here.

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Cooley's lawyers solve legal issues for entrepreneurs, investors, financial institutions and established companies. Clients partner with Cooley on transformative deals, complex IP and regulatory matters, and high-stakes litigation, often where innovation meets the law.

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Related Contacts
Craig Jacoby Partner, San Francisco