Venture-backed IPO activity topped 2012's tally by 55% spurred by the healthcare sector. But the top 10 largest venture-backed exits were dominated by high-profile tech IPOs including Twitter and FireEye.
The venture capital industry saw a mixed year on the exit front in 2013. While venture-backed IPO activity topped 2012’s tally by 55%, there was no upward momentum in venture-backed M&A levels which slipped 5% on a year-over-year basis. Notably, the IPO boom was driven by a strong year for healthcare IPOs. In total, the 38 venture-backed U.S. healthcare firms that went public combined to take 52% of all U.S. headquartered venture-backed IPOs last year.
Geographically, all three of the largest states for venture-backed financing saw fewer overall venture-backed exits in 2013, with Massachusetts seeing the largest drop at 30%. As the data shows, healthcare firms including Epizyme and Foundation Medicine took all of Massachusetts’ venture-backed IPOs while zero went to tech (the lack of tech IPOs may be one reason why Mass. has had a lackluster ability to attract new tech VCs into its ecosystem.) Interestingly, Washington saw a 92% rise in venture-backed exits on a year-over-year basis including Zulily and Tableau’s IPOs.
While tech IPO totals actually fell 7% in 2013 on a year-over-year basis, the top 10 largest venture-backed exits were dominated by high-profile tech offerings. In fact, the tech sector claimed all five of the largest venture-backed exits by valuation at the time of exit led by Twitter, Zulily and Veeva Systems, which was also the most capital-efficient venture-backed exit of the year. Just one M&A exit, Yahoo’s $1.1B acquisition of Tumblr, made the top 10 – and was one of just three disclosed venture-backed acquisitions valued at over $1B in 2013 (the other being FireEye’s acquisition of Mandiant and Monsanto’s acquisition of The Climate Corporation). Please note that The Climate Corporation exit was rumored to be valued at $930 million to $1.1 billion.
Data Integrity Note: This list does not include private equity transactions or acquisitions that took place after an initial public offering. Exit valuations are taken from time of the IPO and/or acquisition.
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