Venture Financing Report - 2011 Year in Review

2011 Venture Financing in Review - A Year of Rising Valuations
March 1, 2012

Cooley LLP is pleased to present our findings on venture financings for 2011, which can be found by clicking on the PDF link below. This report provides a summary of data reflecting our experience in venture capital financing terms and trends. Information is taken from transactions in which Cooley served as counsel to either the issuing company or the investors.

Overall, our data pointed to a year marked by increasing valuations across all deal stages. In 2011, we saw aggregate dollars raised reach a level not seen in the last five years. As mentioned, median pre-money valuations increased across all deal stages and we saw a significant increase in up versus flat/down rounds. Up rounds represented 69% of all financings in 2011, a level not seen since 2007. Additionally, the percentage of recapitalization transactions fell in 2011, as well as the number of tranched deals. Deal terms also mirrored the financing statistics. We observed decreases in the use of fully participating preferred and pay-to-play provisions in 2011 compared to the prior year.

We hope you find this Report informative. Please let us know what other information you would find useful by contacting any of the Cooley partners listed at the end of the report or your local Cooley counsel.

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