Venture Financing Report – Q1 + April 2020 – Tip of the Iceberg?

With the onset of the COVID-19 crisis in March, we decided to include April data in our first 2020 report to better illustrate any early indicators of effects of the pandemic on the financing environment. Additionally, we have broken out specific statistics by month and industry (technology/life sciences/other) to offer more targeted insights. During the first four months of 2020, Cooley handled 465 disclosable deals representing more than $13.4 billion of invested capital. Median pre-money valuations remained relatively strong across deal stages, though valuations did decrease in Series C transactions. In a possible preview of future quarters, the percentage of down rounds increased to 16% of transactions during April, a level not seen since Q4 2016. Deal terms during the four month period were mixed. The percentage of deals using full participating liquidation preferences decreased to 7.4% of transactions in April, compared to 7.6% of transactions from January to March. However, there was a slight increase in the percentage of deals involving recapitalizations compared to prior quarters. This will be a data point to monitor in the coming months.

Visit Cooley GO to view the interactive visualization

This content is provided for general informational purposes only, and your access or use of the content does not create an attorney-client relationship between you or your organization and Cooley LLP, Cooley (UK) LLP, or any other affiliated practice or entity (collectively referred to as “Cooley”). By accessing this content, you agree that the information provided does not constitute legal or other professional advice. This content is not a substitute for obtaining legal advice from a qualified attorney licensed in your jurisdiction and you should not act or refrain from acting based on this content. This content may be changed without notice. It is not guaranteed to be complete, correct or up to date, and it may not reflect the most current legal developments. Prior results do not guarantee a similar outcome. Do not send any confidential information to Cooley, as we do not have any duty to keep any information you provide to us confidential. This content may be considered Attorney Advertising and is subject to our legal notices.