Last year saw the deployment of a whopping 221 $100M+ financings to VC-backed companies.
Fueled by this torrent of mega-rounds, a full 78 VC-backed private companies joined the unicorn club of companies with valuations of $1B+ in 2015. However, both mega-rounds and unicorn births fell off a cliff towards the close of the year, and investors have been even more reluctant to jump into these outsize deals as 2016 got underway.
We took a look at mega-round and unicorn activity as part of the KPMG and CB Insights Venture Pulse Report, built using CB Insights’ private company database.
Amid high-profile unicorn company layoffs, mutual fund markdowns and other setbacks, Q1’16 hit a 5-quarter low for new VC-backed unicorns. Just 5 new unicorns were minted, less than half that of any quarter in 2015.
New unicorns by continent
North America and Asia saw a dearth of new unicorns, while Europe did see a new unicorn after seeing none in the previous quarter. Europe’s new VC-backed unicorn was travel search engine Skyscanner. North America’s sole entrant was business solutions provider Anaplan, while Asia had three new unicorns in Q1’16, including Japan’s first unicorn in peer-to-peer marketplace Mercari.
The scramble to find the next unicorn saw investors open their checkbooks for mega-rounds throughout most of 2015.
However, these $100M+ equity financings remain depressed after falling off a cliff in Q4’15, with all major markets trending flat at best. Q1’16 saw $8.7B invested across 37 such deals, compared to $11.5B over 40 deals in Q4’15, and a whopping $20.1B across 71 deals in Q3’15.
Feature image credit: William Murphy/Flickr
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