Cooley LLP is pleased to present our findings on venture financings for Q2 2013, which can be found by following the 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 quarter marked by an increase in early stage transactions compared to the prior quarter. In Q2 2013, over 41% of deals were Series A transactions. Median pre-money valuations were mixed, as Series B and C deals saw valuation increases, while Series A and D+ deals saw valuation declines. We also saw a decrease in up versus flat/down rounds from the prior quarter. Up rounds represented 66% of all financings in Q2. Additionally, the percentage of deals structured in tranches increased in Q2 and the percentage of recapitalization transactions also rose to over 8% of all deals. Deal terms in Q2 2013 continued a move away from the company-friendly terms we observed through much of 2012. We saw increases in the use of fully participating preferred provisions in later stage deals during the quarter. The utilization of pay-to-play provisions also spiked in Q2, compared to the prior quarter.

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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