MoneyTree Report Q3 20192 Executive summary Q3 2019 US VC funding levels and deal activity fall in Q319 US VC funding remains elevated despite falling in Q319: US VC-backed companies raise $26B in Q319, a 15% decline compared to Q219. Deal activity fall 16% to 1,304 transactions. $100M+ rounds fall from record levels as prominent unicorns exit: 55 VC deals raise $100M or more in Q319, a sharp decline from a record 67 in Q219. US technology companies continue IPO surge: 22 US VC- backed tech companies exit in IPOs in Q319, following a highly elevated 33 in Q219. Number of US unicorns sets new record despite recent IPOs: As of Q319, there are 180 private VC-backed US companies valued at $1B+. Despite a number of prominent VC-backed IPOs, the number of US-based unicorns remains at record highs. Global funding levels and deal activity fall in Q319 as Asia stays steady North America, Asia, and Europe combined funding hits $50B in Q319: Global VC funding falls 7% in Q319, to $52B being raised over 3,420 deals. Asia deal activity rises amid falling global deal activity: Funding remains steady in Asia at $15B in Q319, but deal activity rises slightly to 1,271 transactions. Bay Area funding and deal activity fall sharply in Q319: Bay Area VC sees a 19% quarterly decline to $12B in Q319. Deal activity also falls to 388 transactions, compared to 479 in Q219. New York Metro sees slight uptick in funding amid falling deal activity: New York Metro funding rises 2% to $4B in Q319. Deals fall sharply to 189 transactions, an 18% decline compared to Q219. Geographic Insights US InsightsSource: PwC / CB Insights MoneyTree Report Q3 2019 3 1,487 1,616 1,712 1,528 1,429 1,425 1,555 1,304 20.3 23.3 25.0 29.5 39.4 26.4 30.3 25.9 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 US deals and dollars Quarterly US VC funding levels and deal activity fall in Q319 Record funding (all-time) Investments ($B) # of dealsSource: PwC / CB Insights MoneyTree Report Q3 2019 4 2000 2005 2010 2015 2019 YTD 8,297 1,894 3,423 6,313 6,285 4,284 US deals and dollars Annual 2019 YTD US funding is strong following a record 2018 $119 $83 Record funding (all-time) Investments ($B) # of deals $117 Record funding (this decade)Source: PwC / CB Insights MoneyTree Report Q3 2019 5 US funding Quarterly seasonality US funding YTD tracking above the past six years $8.2 $12.3 $18.9 $16.6 $16.2 $23.3 $26.4 $9.0 $16.9 $20.9 $18.8 $19.8 $25.0 $30.3 $9.2 $13.9 $20.8 $15.8 $21.6 $29.5 $25.9 $10.2 $17.6 $17.6 $12.3 $20.3 $39.4 2013 2014 2015 2016 2017 2018 2019 YTD Record annual funding (this decade) Q3 Q2 Q1 Q4 Total Investments ($B): $36.6 $117.2 $77.8 $63.5 $78.2 $60.7 $82.6Source: PwC / CB Insights MoneyTree Report Q3 2019 6 Deal activity by round Deal activity down in all funding stages in Q319 Note: All deals include additional round types 1,267 All deals 468 95 44 309 SeriesA 97 Series C 41 Series E+ 1,304 328 Seed 246 Q114 Q115 Q116 Q117 Q118 Q119Source: PwC / CB Insights MoneyTree Report Q3 2019 7 Q114 Q115 Q116 Q117 Q118 Q119 Series A $12.0M $8.0M $2.1M $2.0M Seed Median deal size by round Series E+ median deal size hits $100M in Q319 $100M Series C $0.6M $11.4M $3.8M $9.0M $6.3M Note: Overall median includes additional round types Series E+ $25.0MSource: PwC / CB Insights MoneyTree Report Q3 2019 8 35 34 50 55 52 49 67 55 Mega-rounds Investments and deal counts Mega-rounds remain elevated despite fall from record Q219 $7.6 $8.0 $8.5 $14.6 $24.9 $12.1 $13.9 $12.7 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Record mega-rounds (all-time) Record mega-round investments (all-time) Mega-round investments ($B) # of Mega-rounds Note: Mega-rounds are $100M deals or largerSource: PwC / CB Insights MoneyTree Report Q3 2019 9 38% 34% 34% 50% 63% 46% 46% 49% Mega-rounds Funding and share of deals Mega-round investments increase to nearly half of all deals $7.6 $8.0 $8.5 $14.6 $24.9 $12.1 $13.9 $12.7 $11.5 $12.5 $12.3 $12.3 $14.7 $15.8 $13.9 $13.2 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Record mega-round share (all-time) Mega-round investments ($B) Non mega-round investments ($B) Mega-round share Note: Mega-rounds are $100M deals or largerSource: PwC / CB Insights MoneyTree Report Q3 2019 10 Mega-rounds Quarterly seasonality US $100M+ rounds are still on track to set records again $1.2 $2.9 $6.9 $4.3 $4.4 $8.0 $12.1 $0.9 $4.4 $7.3 $7.4 $7.0 $8.5 $13.9 $0.8 $3.4 $7.8 $4.9 $9.0 $14.6 $12.7 $1.2 $6.9 $6.2 $2.3 $7.6 $24.9 2013 2014 2015 2016 2017 2018 2019 YTD Record annual mega-round funding (all-time) Record quarterly mega-round funding (all-time) $4.1 $56.1 $28.1 $18.9 $28.2 $17.6 $38.7 Note: Mega-rounds are $100M deals or larger Q3 Q2 Q1 Q4 Total Investments ($B):Source: PwC / CB Insights MoneyTree Report Q3 2019 11 Sector Deals Funding 1 Internet $10.0B 2 Healthcare $4.9B 3 Mobile & Telecommunications $2.9B 4 Software (non-internet/mobile) $2.0B 5 Consumer Products & Services $0.6B 68 132 151 180 537 Deals and dollars US sectors Internet startups continue to receive outsized financing12 Source: PwC / CB Insights MoneyTree Report Q3 2019 Top 10 Verticals by deal activity Seven Internet verticals dominate deal activity #1 Healthcare > Biotechnology #2 Internet > SaaS > Monitoring & Security #3 Internet > SaaS > BI, Analytics & Performance Mgmt #4 Internet > SaaS > Accounting & Finance #5 Internet > eCommerce > Marketplace #6 Healthcare > Drug Development #7 Internet > SaaS > Healthcare #8 Consumer Products & Services > Consumer Electronics #9 On Premise Software > Healthcare Software #9 Internet > SaaS > HR & Workforce Management #10 Mobile > SaaS > Health & Wellness #10 Internet > SaaS > Health & Wellness13 Source: PwC / CB Insights MoneyTree Report Q3 2019 Top 10 Verticals by investments Four verticals spike due to large single deals this quarter #1 Healthcare > Biotechnology #2 Internet > SaaS > Accounting & Finance #3 Internet > SaaS > BI, Analytics & Performance Management #4 Computer Hardware & Services > IT Services #5 Business Products & Services > Advertising, Marketing & PR #6 Internet > SaaS > Monitoring & Security #7 Healthcare > Drug Development #8 Healthcare > Medical Facilities & Services > Medical Practitioners #9 Internet > eCommerce > Marketplace #10 Healthcare > Medical Facilities & Services > HospitalsSource: PwC / CB Insights MoneyTree Report Q3 2019 14 Largest US deals of Q319 Q319 sees one US-based $1B+ funding round Company Investment Round Select investors Vertical 1 OpenAI San Francisco, CA $1.00B Other Microsoft Computer Hardware & Services IT Services 2 Authentic Brands New York, NY $875M Private Equity BlackRock Business Products & Services Advertising Marketing & PR 3 Radiology Partners El Segundo, CA $700M Growth Equity Starr Investment Holdings Healthcare Medical Facilities & Services Medical Practitioners 4 Allied Pacific of California Hawthorne, CA $545M Other Northern Light Venture Capital, s28 Capital Healthcare Medical Facilities & Services Hospitals 4 Utility Technologies San Francisco, CA $525M Series E+ CPP Investment Board, Sequoia Capital, Silver Lake Partners Software (non-internet/mobile) Multimedia & GraphicsSource: PwC / CB Insights MoneyTree Report Q3 2019 15 Top 5 funded US companies Q319 The top funded companies retain their positions in Q319 Company Funding Vertical Emerging areas Select investors 1 Juul Labs San Francisco, CA $13.6B Consumer Products & Services Consumer Electronics Consumer Hardware Coatue Management, D1 Capital Partners, Tiger Global Management 2 WeWork New York, NY $6.6B Business Product & Services Facilities Co-Working & Co-Living Spaces T. Rowe Price, Benchmark Capital, SoftBank Group 3 Airbnb San Francisco, CA $3.6B Internet E-Commerce Travel On-Demand Sequoia Capital, Andreessen Horowitz, Greylock Partners, General Catalyst 4 SpaceX Hawthorne, CA $2.9B Industrial Aerospace & Defense Space Tech Founders Fund, Threshold Ventures, Fidelity Investments, Google 5 Magic Leap Plantation, FL $2.6B Software (non-internet/mobile) Scientific, Engineering Software AR/VR Alibaba Group, Fidelity Investments, GoogleSource: PwC / CB Insights MoneyTree Report Q3 2019 16 Unicorns New US VC-backed unicorns by quarter $100M+ mega-rounds give birth to several new unicorns 8 7 9 19 23 16 20 17 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Record new unicorns (all-time) Note: Unicorns are startups valued at $1B or more US VC-backed unicorn birthsSource: PwC / CB Insights MoneyTree Report Q3 2019 17 111 117 120 128 145 158 169 180 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Record population (all-time) US unicorn population US unicorn population climbs to a new record in Q319 Unicorn population count (US) Note: Unicorns are startups valued at $1B or moreSource: PwC / CB Insights MoneyTree Report Q3 2019 18 $379.6 $408.3 $416.2 $477.2 $586.5 $612.0 $577.5 $621.2 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Record aggregate unicorn valuation (all-time) Unicorn valuations ($B) Note: Unicorns are startups valued at $1B or more Unicorns US aggregate unicorn valuation Total value of US unicorns rebounds to a new record in Q319Source: PwC / CB Insights MoneyTree Report Q3 2019 19 Company Valuation Vertical Emerging areas Select investors 1 Juul Labs San Francisco, CA $50.0B Consumer Products & Services Consumer Electronics Consumer Hardware Coatue Management, D1 Capital Partners, Tiger Global Management 2 WeWork New York, NY $47.0B Business Product & Services Facilities Co-Working & Co-Living Spaces T. Rowe Price, Benchmark Capital, Softbank Group 3 Stripe San Francisco, CA $35.3B Internet Software & Services Payments Fin Tech Khosla Ventures, Lowercase Capital, capital 4 Airbnb San Francisco, CA $35.0B Internet E-Commerce Travel On-Demand Sequoia Capital, Andreessen Horowitz, Greylock Partners, General Catalyst 5 SpaceX Hawthorne, CA $33.3B Industrial Aerospace & Defense Space Tech Founders Fund, Threshold Ventures, Fidelity Investments, Google Top 5 highest valued US unicorns Q319 Stripe surpasses Airbnb and SpaceX with a $35.3B valuation Note: Most recently disclosed valuations associated with a funding round are includedSource: PwC / CB Insights MoneyTree Report Q3 2019 20 6.7 6.5 6.8 6.2 7.1 6.3 7.5 6.6 160 170 177 165 187 164 166 163 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 US M&A exits Quarterly M&A exits and time-to-liquidation decline slightly in Q319 Note: Median years to liquidate from first funding Record exits (all-time) M&A exits YearsSource: PwC / CB Insights MoneyTree Report Q3 2019 21 8.6 4.5 6.7 7.1 7.0 5.4 7.3 7.5 25 13 32 25 17 15 33 22 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 9th fastest (this century) 8th highest (ever) IPO activity Years to IPO US IPOs Quarterly US IPO exits dip after record Q219, time-to-IPO remains flat Note: Median years to liquidate from first fundingSource: PwC / CB Insights MoneyTree Report Q3 2019 22 6.7 6.5 6.8 6.2 7.1 6.3 7.5 6.6 8.6 4.5 6.7 7.1 7.0 5.4 7.3 7.5 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 M&A exits and IPOs Time-to-exit IPO exits take longer than M&A by nearly a year Years to IPO Years to M&A Note: Median years to liquidate from first fundingSource: PwC / CB Insights MoneyTree Report Q3 2019 23 160 170 177 165 187 164 166 163 25 13 32 25 17 15 33 22 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 M&A exits and IPOs Number of exits Q319 IPO exits see larger decline than M&A exits IPO exits M&A exitsSource: PwC / CB Insights MoneyTree Report Q3 2019 24 Top 5 M&A exits of Q319 Internet and Healthcare sectors dominate top deals Company Last round Valuation Verticals Select prior investors Buyer 1 Morphe San Francisco, CA Growth Equity $2.2B Consumer Products & Services Personal Personal Care Products Summit Partners General Atlantic 2 SignalFX San Mateo, CA Series E $1.1B Internet Internet Software & Services Monitoring & Security Andreessen Horowitz, CRV Splunk 3 BlueRock Therapeutics Cambridge, MA Incubator/ Accelerator $1.0B Healthcare Biotechnology JLabs, Bayer, Versant Ventures Bayer 3 Acquia Boston, MA Other $1.0B Internet Internet Software & Services Customer Relationship Management New Enterprise Associates, Goldman Sachs, Sigma Prime Ventures Vista Equity Partners 3 Semma Therapeutics Cambridge, MA Series B $1.0B Healthcare Biotechnology ARCH Venture Partners, F-Prime Capital Vertex Pharmaceut icalsSource: PwC / CB Insights MoneyTree Report Q3 2019 25 Top 5 IPOs of Q3 2019 New York takes the top two IPOs of Q319 Company Last round Valuation Verticals Select prior investors 1 Peloton New York, NY Series F $8.1B Internet Internet Software & Services Health & Wellness Tiger Global, 2x Consumer Products Growth Partners, Balyasny Asset Management 2 Datadog New York, NY Series D $7.8B Internet Internet Software & Services Business Intelligence Amplify Partners, Battery Ventures, IA Ventures 3 10X Genomics Pleasanton, CA Series D $3.6B Healthcare Biotechnology Vital Venture Capital, Foresite Capital, Paladin Capital Group 4 Medallia San Francisco, CA Series E $2.6B Internet Internet Software & Services Business Intelligence Sequoia Capital, RGM Capital, Wasatch Advisors 5 Livongo Health Mountain View, CA Series E $2.5B Mobile & Telecommunications Mobile Software & Services Health & Wellness 7wire Ventures, Slow Ventures, General Catalyst26 Source: PwC / CB Insights MoneyTree Report Q3 2019 Top 10 Metros by deal activity Six Top 10 Metros see over 15% drops in deal activity #1 San Jose-San Francisco-Oakland, CA #2 New York-Newark, NY-NJ-CT-PA #3 Los-Angeles-Long Beach, CA #4 Boston-Worcester-Providence, MA-RI-NH-CT #5 Seattle-Tacoma, WA #6 Denver-Aurora, CO #7 Chicago-Naperville, IL-IN-WI #8 San Diego-Carlsbad, CA #9 Washington-Baltimore-Arlington, DC-MD-VA-WV-PA #10 Austin-Round Rock, TX27 Source: PwC / CB Insights MoneyTree Report Q3 2019 Top 10 Metros by investments Three Top 10 Metros see investments drop over 10% #1 San Jose-San Francisco-Oakland, CA #2 New York-Newark, NY-NJ-CT-PA #3 Los-Angeles-Long Beach, CA #4 Boston-Worcester-Providence, MA-RI-NH-CT #5 San Diego-Carlsbad, CA #6 Seattle-Tacoma, WA #7 Philadelphia-Reading-Camden, PA-NJ-DE-MD #8 Chicago-Naperville, IL-IN-WI #9 Columbus-Marion-Zanesville, OH #10 AtlantaAthens-Clarke CountySandy Springs, GASource: PwC / CB Insights MoneyTree Report Q3 2019 28 457 543 526 448 435 387 479 388 $8.8 $11.1 $10.4 $14.0 $25.4 $12.3 $14.2 $11.5 Q417 Q118 Q218 Q318 Q418 Q119 Q219 Q319 Investments ($B) # of deals Silicon Valley deals and dollars Quarterly Q319 deal activity and investments decline compared to Q219Source: PwC / CB Insights MoneyTree Report Q3 2019 29 Top Silicon Valley deals Silicon Valley still raises six $300M or greater rounds Company Investment Round Select investors Vertical 1 OpenAI San Francisco, CA $1.00B Other Microsoft Comput