But we can do even better, so here’s the word-free version for you visual learners:

Feel free to drop me an email1 with feedback or notes about this round of quarterly reports. I’m tempted to cut back on our volume a bit, as the number of pieces is getting to be a bit much (click the image below to see the full stack). At the same time, I am hugely in favor of getting as many numbers and notes live as we can. We’ll want to look back at the data when things fall apart.

Regardless, we are done for this cycle. Thanks for reading.

But we’re feeling good as there was a lot to听uncover. The global report detailed record investment in the venture world. Our North American report was chock-full of staggering figures. In fact, most everything we put out concerning the quarter seemed stuffed with superlatives, local maximums, and all-time highs.

With all the words finally out, it’s time to publish our regular roundup of charts and tables. We’ll begin this time, as always, with the images from our US and Canada focused report from our own Joanna Glasner.

Here’s the packet:

As 2018 drew to a close, SA国际传媒 News reported on a year of superlatives. With technology impacting a broader set of industries, we鈥檝e seen unprecedented funding amounts in 2018 (projected to be up 56 percent YoY), along with a rise in supergiant rounds. Nearly $40 billion was invested in companies with at least one female founder, representing 17 percent of invested dollars in the year.

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Let鈥檚 take a more nuanced look at how female-founded startups fared this investment cycle.

Supergiant $100 Million Plus Rounds

Let’s take a look at a subset of that topline number.

Of the almost $40 billion raised by women in 2018, 50 known rounds were above the $100 million mark for this year, making up for 65 percent ($26.2 billion) of the dollar amounts raised by companies with at least one female founder.

In contrast, male-only founded companies raised 338 rounds above $100 million at $103 billion (53 percent) of dollars raised by male-only teams.

Global Venture Dollar Volume

In 2018, $38.9 billion was invested in companies with a female founder, representing 17 percent of venture dollars funded globally. Investments in 2018 came close to doubling the amount recorded in 2017, a year that saw $19.8 billion invested into companies with at least one female founder.

2018 is at an all-time high for investment dollars into female-founded tech companies.

So how does this compare to 2017 in terms of percentage of total raised funds by startups with at least one female founder when compared to male-only founded startups?

Even though the dollar amounts close to doubled year over year, 2018 shows only a three percentage point increase in the share of venture capital raised by companies with at least one female founder over 2017, which was at 14 percent. The disappointing percentage increase is due to the overall expansion in investment dollars in tech startups for 2018.

It is also worth noting that female-founded raised an enormous $14 billion round in 2018. Were it not for Ant Financial, 2018 would would have recorded a lower percentage of total venture dollars going to companies with at least one female founder compared to the two preceding years’ results of 14 and 13 percent, respectively.

Global Venture Deal Volume

Though dollar amounts into startups with at least one female founder have gone up, reported round counts have fallen. In 2018 1,106 rounds went to companies with at least one female founder, making up 14 percent of all venture rounds with known founders. It鈥檚 a modest decline from 2017, which recorded 15 percent of total deal volume going to female-founded startups.

Female-Only Founded Startups Raise Fewer Dollars

The median funding amount for female-only founded startups is consistently below male-only founded teams, as well as male and female co-founded startups. Across the board, however, all founding teams have seen median dollar amounts go up.

From 2015 through 2017, male and female co-founded startups medians were either higher or equal to male-founded startups, suggesting that it is female-only founded startups that face greater challenges when it comes to fundraising.

Notable Fourth Quarter Fundings In Female-Founded Startups

December is typically a slow month for venture investing; however, a significant number of financings closing at the tail end of 2018.

The Wing

One investment that came in under the wire is co-founded by CEO and COO . The Series C funding of $75 million raised in December was led by of with participation from with . Prior investors include that led the Series A and in the seed round. The Wing, a membership-based organization for women (and now ) who are seeking a coworking space, is utilizing the recently raised funding to expand to new locales, including West Hollywood, London, Toronto, Seattle, Chicago, and Boston. Many of its investors are also women.

Minted

Another December financing went to , a social design marketplace company, founded by CEO and President . Minted raised a $208 million Series E round. The company sells graphic design, stationery, art, and home decor from a global design community. The round was led by PE firms and . Previous lead investor from Series A to D include , , , and .

Zume Pizza

Co-founded by CEO and President , Zume Pizza raised a $375 million Series C from the . Zume Pizza is developing next-generation food delivery, with its robotic pizza maker, along with food trucks with ovens that deliver freshly made pizza on the go. Early investors include and

Most Active Venture Investors In Female-Founded Startups

tops the list with 24 investments in female-founded companies. Next up are , , and , with each investing in 15 companies last year with female founders. The investor with this highest percent is with 9 investments at 64 percent of their portfolio. , , , and all had 30 percent or higher invested in female-founded teams in 2018.

Editorial note: This SA国际传媒-sourced report relies on firm and community-provided data to rank investors by seed investments. Due to reporting delays and the relatively opaque nature of private capital, this list may exclude certain investors and investments. SA国际传媒 News is continually examining how it gathers and reports on this data. Moving forward, we’re updating the process by which this chart was created.

Global Seed Dollar Volume

19 percent of 2018鈥檚 reported seed-stage deal volume went to companies with a female founder, the most in the past five years.

In 2018, six percent of total known seed-stage dollar volume went to female-only founded startups, and 14 percent to startups with both male and female co-founders.

Global Seed Deal Volume

At the earliest stages of investment, female-founded startups are making incremental gains year-over-year鈥攁ccounting for nearly a quarter of known seed-stage deals made in 2018. This is a particularly important stage to see improvement in, as it establishes the baseline of deals made that could later turn into early-stage and late-stage startups. It鈥檚 important to note, however, that seed-stage dealmaking has been contracting since 2017, as SA国际传媒 News鈥檚 Q4 2018 VC report noted.

Looking Forward

While 2018 is at an all-time high for investment dollars into female-founded startups, there is still a ways to go with female founders raising only 17 percent of investment dollars. A couple of notable VCs had advice for women when fundraising.

鈥淚n my experience, female founders are much less likely to make an ask at the end of meetings with VCs, so my biggest piece of advice is don’t leave without making a clear and actionable ask! Know what the next steps are and what the partner might need to get to a quick decision.鈥� said of Upfront Ventures.

of Forerunner Ventures, who raised a $360 million dollar Fund IV in 2018, has the following advice: 鈥淥wn your ambitions. Seek what you need to achieve the best version of your plan and find a partner who believes in you, your mission, and aligns with your goals.鈥�

Notes On The Data

The charts and information in this report is based off of reported data in SA国际传媒. In other words, it鈥檚 based off of publicly disclosed rounds included in SA国际传媒 dataset.

SA国际传媒鈥檚 dataset is constantly expanding, but there are gaps. A company may not have founders listed on its SA国际传媒 profile. Or SA国际传媒 might not have a gender listed for founders that are attached to the person鈥檚 SA国际传媒 profile. (Note: In addition to 鈥渕ale鈥� and 鈥渇emale,鈥� SA国际传媒 has over two dozen other gender tags.)

SA国际传媒, like all databases of private-market transactions, has a documented pattern of reporting delays. It can sometimes take between weeks to months for some rounds to be announced publicly and subsequently get added to SA国际传媒. This is especially the case for seed and early-stage deals, which are often raised by companies before the company launches a product or otherwise gets much outside media coverage which surfaces information about the company鈥檚 funding history. More data will be added to SA国际传媒 over time and some of the numbers in this report may shift slightly.

Correction: SA国际传媒 News鈥檚 chart titled 鈥�2018鈥檚 Most Active Seed Investors In Female-Founded Startups鈥� has been removed due to data inconsistencies discovered by readers. News will revisit its processes behind this data pull in future quarterly reports.

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In this venture report on Asia Pacific, we鈥檒l look at how the region fared in an increasingly unsure economic climate, taking an up-close look at its driving force: Mainland China.

The Numbers

Before we get to the doom and gloom, let鈥檚 look at how the Asia Pacific鈥檚 fourth quarter and full-year 2018 venture results compared to their predecessors.

According to SA国际传媒 data, which is indicative of industry trends, venture capitalists invested roughly $138 billion in Asia-Pacific startups last year. 1

According to the chart above, which includes preceding years, 2018鈥檚 figure is more than 100 percent increase from 2017鈥檚 own venture total. On the deal end, more than 5,000 known rounds were reported, a nearly 50 percent year-over-year increase in deal volume in the region overall.

With rounds up half and dollars up double, there were some big rounds to contend with. In 2018, supergiant deals鈥攖hose worth $100 million or more鈥攇rew by around 75 percent year-over-year to 237.

While it鈥檚 clear that 2018 was a watershed year for the region, let鈥檚 take a closer look at how it panned out on a quarter-by-quarter basis:

While our first chart paints the picture of a booming venture capital economy, the second depicts a markedly different environment. Venture deal and dollar volume decreased by almost 30 percent from Q3 to Q4 2018, nearly shrinking to its year-ago quarter totals.

Don鈥檛 think that the chart shows that the startup markets of Asia Pacific are falling in sync.

China represented more than 60 percent of the total venture dollar and deal volume in the region in Q4 2018, according to SA国际传媒 data. That made it heavily influential in shaping the data above. For example, known deal and dollar volume in Southeast Asia (which doesn鈥檛 include China) increased over the quarterly periods detailed above, including a massive for Indonesia-based Go-Jek spiking the region鈥檚 Q4 total to around $4.1 billion.

Next, let鈥檚 observe how China, specifically, performed on a quarterly basis in 2018.

It鈥檚 important to note that the Q2 2018 known dollar volume total for China was significantly boosted by a banked by (the fintech arm of Alibaba).

Let鈥檚 dive more deeply into China, as its venture results drive the region鈥檚 own.

Breaking Down The Deals

In Q4 2018, seed, early, and late-stage deal volume all decreased quarter-over-quarter. Seed-stage deals represented about 38 percent of deals of known type while commanding just 3 percent of the VC dollar volume of deals of known size and type.

Meanwhile, early-stage deals, like the for Hangzhou-based electric vehicle maker , or the $200 million deal for Starbucks鈥檚 quickly growing competitor , represented about 50 percent of all deals of known type, raking in about 33 percent of the dollar volume among deals of known size and type.

Late stage deals represented the remaining 12 percent of deal volume and a staggering 64 percent of dollar volume for deals of known type and size. The average late-stage round totaled about $167 million. That represents a slight increase over Q3 2018鈥檚 $140 million average, and a decrease of nearly 30 percent from Q2 2018鈥檚 high of $217 million if the Ant Financial round is taken out of consideration.

Keeping a tally of the number of supergiant rounds, SA国际传媒 recorded 39 of more than $100 million rounds in Q4 2018. In both Q2 and Q3 2018, 56 rounds of over $100 million were recorded, while China made off with 38 supergiant rounds in Q1 2018, and 39 in Q4 2017. Here, again, we see a peak in the middle of 2018, and a slope down to the year鈥檚 end.

There are signs that efforts to curb the potential effects of a slowing economy will further that trend.

Looking Forward

Consumer , rising , and 鈥攖hose are just a few metrics that have contributed to a among individuals, entrepreneurs, and investors in China.

A government-encouraged push for entrepreneurship and startup growth led to a surge in the interest of banks and other state-owned institutions in playing a hand in the venture scene in recent years. But, as and others have reported, that encouragement brought a spike in fundraising for possibly inexperienced venture fund directors.

Under-regulated shadow banks, , and noticeably high valuations鈥攃ombined with other pressures like rising debt in the country鈥攍ed the government to more stringent financing and asset management last year.

, the VP of investments at the , told SA国际传媒 News that he believes the shift that occurred in 2018 was likely the result of those financing policies.

鈥淒ue to the tightening of financing policies for the [private equity and] VC industry, many RMB funds encountered difficulties in raising money from LPs [like] banks and financial institutions in 2018,鈥� Yu wrote in an email, adding that the 鈥渟cale back鈥� will likely continue in 2019.

Further, he noted that the combination of those policy changes along with expectations that global stock markets may continue to underperform this year will make it difficult for VCs to afford such high valuations.

鈥淗eavily funded [or heavily] valued startups will still be able to live up to their previous valuations,鈥� Yu wrote. 鈥淏ut it will be more difficult to ask for a higher valuation in their next rounds of financing.鈥�

If there鈥檚 a smaller pot of gold and anticipation that returns through a public exit will be less lucrative, that means that supergiant rounds like those mentioned above will likely be less common. And in an atmosphere that has been referred to as a funding winter, consolidation of industries may continue. This is particularly the case for those in the electric vehicle industry, where government subsidies that have warmed investor and entrepreneurial interest have started to scale back.

And if the stock market in China keeps significant pressure on China鈥檚 big tech market caps, it could be the case that now-infamous large corporate investments by players like Baidu, Alibaba, and Tencent in startups in China become less common. , managing partner at Beijing-based , told SA国际传媒 News that she believes revenue interests may occupy corporate attention.

鈥淲e are likely to see less investment activities across the board this year in China not just due to the falling share prices of tech giants but also the slow growth of the macroeconomic condition,鈥� Cheng wrote in an email. 鈥淐orporations will need to improve their bottom lines and will have less to spend on investments as a result.鈥�

That slowing economic condition could also mean that the companies may scale back from pursuing global growth through investment in startups in emerging economies in Southeast Asia and India. However,, general partner at in Singapore, told SA国际传媒 News that while VCs are scaling back in China, he believes fluctuations in venture capital funding in emerging markets like Southeast Asia will likely be short-lived.

鈥淢ore capital is being reallocated out of traditional asset classes into alternatives, and within alternatives, from hedge funds into [private equity] and VC,鈥� Harnal explained in an email. 鈥淚n Southeast Asia, most family office wealth is significantly over-allocated stocks, bonds, and real estate, but that is quickly changing as they familiarize themselves with VC as an asset class and increase their exposure.鈥�

China has helped lead the world of tech and VC in 2018 that brought major venture capital gains, but a slowing economy, ongoing trade tensions, and stumbling global markets foreshadow a less optimistic future. China鈥檚 government has a history of addressing domestic issues with precipitous policies that have engendered long-term . If the country is challenged by a recession, we鈥檒l have to see if 鈥渃apitalism with Chinese characteristics鈥� will keep its economy afloat, or whether the venture community and the country鈥檚 2025 goals will drown with it.

Methodology Notes

Companies considered in this section only include those that have listed geographical locations on SA国际传媒. Companies in the Asia-Pacific include Mainland China, Hong Kong, Macao, Taiwan, South Korea, North Korea, Japan, Mongolia, Philippines, Indonesia, Myanmar, Laos, Thailand, Cambodia, Singapore, Malaysia, Vietnam, Australia, New Zealand, Bhutan, Bangladesh, British Indian Ocean Territory, Indonesia, Maldives, India, Nepal, Pakistan, and Sri Lanka.

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Our editorial bent is more clear cut: How much money is going into startups? Who is putting that money in? And what trends can we suss out about the health of the market over time?

So let鈥檚 talk about the state of AI startups and how much capital is being raised. Here’s what I can tell you: funding totals for AI startups are growing year-over-year; I just don鈥檛 know precisely how quickly. Regardless, startups are certainly raising massive sums of money off the buzzword.

To make that point, here are just a few of the biggest rounds announced and recorded by SA国际传媒 in 2018:

1. , a China-based startup that is quite good at tracking your face wherever it may be, raised a $1 billion Series D round. It was the largest round of the year in the AI category, according to SA国际传媒. But what’s more mind-blowing is that the company raised a total of $2.2 billion in just one year across three rounds. A picture is worth a thousand words, but a face is worth billions of dollars.
2. , another China-based startup focusing on robotics, raised an $820 million Series C. Just a cursory look at its website, however, makes UBTech appear to be a high-end toymaker rather than an AI innovator.
3. And biotech startup , which “manufactures microbes for Fortune 500 companies,” according to SA国际传媒, raised a $400 million Series C.

Now, this is the part I normally include a chart and 400 words of copy to contextualize the AI market. But if you read the above descriptions closely, you’ll see our problem: What the hell does 鈥淎I鈥� mean?

Take Zymergen as an example. SA国际传媒 tags it with the AI marker. Bloomberg, citing data from CB Insights, . But if you were making the decision, would you demarcate it as an AI company?

窜测尘别谤驳别苍鈥檚 doesn’t employ the phrase. Rather, it uses buzzwords commonly associated with AI鈥攎achine learning, automation. 窜测尘别谤驳别苍鈥檚 home page, technology page, and careers page are devoid of the term.

Instead, the company focuses on molecular technology. Artificial intelligence is not, in fact, what Zymergen is selling. We also know that Zymergen uses some AI-related tools to help it understand its datasets (check its jobs page for more). But is that enough to call it an AI startup? I don鈥檛 think so. I would call it biotech.

That brings us back to the data. In the spirit of transparency, CB Insights reports a 72 percent boost in 2018 AI investment over 2017 funding totals. SA国际传媒 data pegs 2018’s AI funding totals at a more modest 38 percent increase over the preceding year.

So we know that AI fundraising for private companies is growing. The two numbers make that plain. But it鈥檚 increasingly clear to me after nearly two years of staring at AI funding rounds that there’s no market consensus over exactly what counts as an AI startup. Bloomberg in its coverage of CB Insights鈥� report doesn鈥檛 offer a definition. What would yours be?1

If you don鈥檛 have one, don鈥檛 worry; you鈥檙e not alone. Professionals y debate what AI actually means, and who actually deserves the classification. There鈥檚 no taxonomy like how we classify animals, for startups. It鈥檚 flexible, and with PR, you can bend perception past reality.

I have a suspicion there are startups who overstate their proximity to AI. For instance, is employing Amazon鈥檚 services in your back end enough to call yourself an AI startup? I would say no. But after perusing SA国际传媒 data, you can see plenty of startups that classify themselves on such slippery grounds.

And the problem we鈥檙e encountering rhymes well with a broader definitional crisis: What exactly is a tech company? In the case of Blue Apron, public investors certainly differed with private investors over the definition, as Alex Wilhelm has touched on before.

So what I can tell you is that AI startup funding is up. By how much? A good amount. But the precise figure is hard to pin down until we all agree what counts as an AI startup.

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As covered in SA国际传媒 News’s global VC report reviewing Q4 and the rest of 2018, projected deal volume rose by 32 percent and projected dollar volume jumped 55 percent since 2017. For all of 2018, SA国际传媒 projects that well over $300 billion was invested in equity funding rounds across all stages of the venture-backed company lifecycle. (This figure includes an estimate of transactions that were finalized in 2018, but won’t be publicized or added to SA国际传媒 until later. More on how SA国际传媒 projects data can be found at the end of that report.)

Is the market mostly buoyed by the billions raised by the biggest private tech companies, or is a rising tide in this extended aquatic metaphor raising all ships? In other words, is the bulk of the capital going to only a handful of the largest rounds? That鈥檚 what the numbers show.

In the global VC pool, capital is definitely sloshing toward rounds totaling $100 million or more. In the chart below, you can see what percent of reported global VC dollar volume was raised in 鈥渟upergiant鈥� rounds versus deals of smaller size.

In the year, over 56 percent of worldwide dollar volume can be attributed to supergiant rounds. With 61 percent of reported capital coming from supergiants in the final quarter, Q4 2018 has the highest concentration of supergiant dollar volume of any single quarter on record.

Big Money Weighs On The Market

Following that same theme, the calendar year 2018 is the most concentrated year on record. In the chart below, we show how much capital was raised in non-supergiant (<$100M) venture rounds over the past decade. (It鈥檚 basically the bottom part of the first chart, with the data is aggregated over a longer period of time.)

For the first time in at least a decade (and likely ever) supergiant, $100 million+ VC rounds accounted for a majority of reported capital raised. So in summary: Q4 2018 had the highest share of supergiant VC dollar volume on record, and 2018 was the most concentrated year on record.

On the one hand, the results are not surprising, considering that the biggest-ever VC round (a preposterously large raised by ) and several rivals for that top spot were closed last year. That big rounds made a big splash. It was the year of multi-billion dollar global growth funds, SoftBank, and scooter CEOs worth supergiant sums, at least on paper. But was it good for the smaller players too?

Seed and early-stage deal and dollar volume were both up in 2018, but then again so is everything toward the end of a bull market cycle. The question is, when the bottom falls out, between supergiant and more normal-sized rounds, which has the farthest to fall?

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As a reporter who鈥檚 been covering the Texas VC market for a while, I鈥檝e been waiting for the city to catch up to the hype. While it鈥檚 not there yet, we鈥檝e got some encouraging numbers for the fourth quarter and 2018 as a whole to share.

It looks like after a bumpy third quarter, funding in Austin rebounded in Q4 and the Texas capital can continue wearing its unofficial crown as 鈥渒ing of Texas VC鈥� for another year. Houston had a relatively good end to 2018 as well, topping Dallas鈥� reported funding amounts for the second quarter in a row.

Let鈥檚 get into specifics.

The nearly $300 million in reported venture funding raised by Austin startups was the highest Q4 total since 2014, clocking in 45 percent greater than the $206.2 million raised in 2017鈥檚 final quarter, according to SA国际传媒 data. Notably, the number of reported deals, though, was far lower: 39 in Q4 2018 compared to 61 in the 2017 fourth quarter.

Apparent deal volume declines may not be cause for alarm, though. There is a historical pattern of reporting delays for private-market investment transactions. Especially in the case of seed and early-stage deals, which may be small in check size but great in number, it can sometimes take several calendar quarters for details of those transactions to surface publicly and ultimately get added to SA国际传媒.

Higher VC dollar volume signals that Austin鈥檚 venture ecosystem must be maturing as we clearly saw larger deals. It was also a big improvement (82 percent higher to be exact) over the $165 million in reported venture funding that Austin startups brought in across the 2018 third quarter.

Mobile edtech startup $47 million marked the quarter鈥檚 largest deal.

On an annual basis, Austin companies raised at least $1.29 billion in 2018. Because of reporting delays, that number is likely higher, but nonetheless that鈥檚 28 percent higher than the $1.01 billion raised in 2017. SaaS provider s $64 million was the city鈥檚 largest known raise in 2018.

I talked to Austin-based co-founder and partner to get his thoughts on the local funding scene. The firm is reportedly in the midst of closing a 听fund. Shamapant declined to comment on its status.

However, he did tell me that his firm made four new investments in 2018, all in Austin-based companies, in addition to participating in a number of follow-on rounds. About two-thirds of LiveOak鈥檚 portfolio consists of Austin companies. Overall, the firm is exclusively focused on investing in Texas. Investments typically range anywhere between $1.5 million to $4 million on an initial round with the firm targeting somewhere between 15 and 25 percent of ownership. Generally, Shamapant said, LiveOak is much more 鈥渆ntrepreneur-driven than industry-driven.鈥�

鈥淥f the four investments we made in 2018, each was led by a repeat entrepreneur that had exited before,鈥� he said.

LiveOak also saw a couple of exits during the year, including being by partner for $210 million.

Texas鈥檚 performance as a whole was slightly better than 2017. For the year, startups across the state raised a total of $2.3 billion with Austin companies hauling in the majority (54.6 percent) of known funding. This compares to $2.19 billion raised in 2017.

The fourth quarter was relatively weak, though, overall for the state compared to the first two quarters of the year. However, on the positive side, the $549.3 million in known funding raised was 49 percent higher than the $367.7 million raised by Texas startups in the third quarter.

(Please note that for our Texas coverage we use reported, not projected, data. This means that reporting lag鈥攆rom funding events to public knowledge鈥攈as a higher impact than in our more geographically broad quarterly reports.)

Houston Chases Austin And Dallas

Although Houston still came in behind Austin and Dallas in terms of total funding for the year, it did manage to gain ground on a quarterly basis.

In both the third and fourth quarters of 2018, Houston startups surpassed Dallas counterparts when it came to raising venture funds. Houston also nearly caught up to Austin in the third quarter, a rare occurrence.

In the fourth quarter, Houston startups brought in $121.4 million across just 11 known deals, compared to Dallas startups only bringing in $101 million across twice as many deals鈥攕ignaling more early-stage funding took place in Dallas. A notable fourth-quarter Houston deal was the by oil and gas shop , which was also the largest deal in the city for the year as a whole.

For 2018, Houston companies raised $372.8 million across 77 known deals. That means dollars raised climbed an impressive 45 percent compared to $257.7 million across 95 deals in 2017.

Even Austin-based startup shops are paying attention to Houston. I reached out to 鈥檚 (CF) co-founder to find out why his popular and growing accelerator set up shop (and hired a team) in Houston during the fourth quarter.

He said the move was part of the that CF launched last year, which was a mission to connect entrepreneurs, family office investors, and big corporations in Texas.

鈥淚t鈥檚 producing great entrepreneurs with great businesses,鈥� he said, adding that CF invested in multiple Houston companies in 2018 and expects to do more investing in the city in 2019.

Houston’s 鈥渙bvious鈥� strengths as a startup market include being the US headquarters of most energy companies as well as home to the Texas Medical Center and its member companies, according to Baer. He also cited the city鈥檚 standing as the fourth-largest in the country, and the fact that it has one of the nation鈥檚 . But Baer鈥檚 also realistic about its ability to compete with Austin when it comes to its startup and venture scene.

鈥淗ouston is a great city, but it will take many years to build up a great startup ecosystem that rivals Austin,鈥� Baer conceded. 鈥淭here is no reason why it can’t happen and it’s worth the investment, but it does take time.鈥�

And while he applauds the work of 鈥渟trong VC leader鈥� Mercury Fund, he acknowledges that Houston 鈥渏ust needs more of them.鈥�

鈥淗owever, this is not a Houston problem. Very few cities have more than a few VCs,鈥� Baer told SA国际传媒 News. 鈥淲hat Houston has that most places don’t is a lot of corporate VCs. Almost every energy company headquartered in Houston has a venture arm. They tend to fund companies that are Series B and later鈥� so not the seed-stage stuff that is so popular in Austin and they do it all over the world, not just in Houston.鈥�

Meanwhile, Dallas startups rebounded some from a weak third quarter, yet total funding in the fourth quarter was lower than the first two quarters of the year. As mentioned above, companies in Dallas brought in $101 million across 22 known deals in Q4 2018. That was a disappointing 66 percent lower than the $300 million raised in Q4 2017, but a marked improvement over the 2018 Q3 quarter that saw just $41.9 million raised.

As an indicator of just how weak Dallas鈥檚 Q4 was, the largest deal over that three-month period was a $10 million by , a fundraising platform. The city鈥檚 largest funding took place in the second quarter when fintech startup announced a $90 million .

鈥� senior associate perception of the VC funding landscape in Dallas is on par with our findings. He noted that previous quarters and 2017 felt 鈥渕uch more active.鈥�

鈥淒allas was fairly slow in Q4,鈥� he said. 鈥淲e saw mostly follow-on investments occur with previously-funded Dallas based startups, and not a whole lot of investment in new companies.鈥�

Of the deals that were made in the city, he points out that e-commerce platform combinedwas one of the largest.

鈥淢obility and retail were the hottest sectors,鈥� he told SA国际传媒 News. 鈥淪urprisingly, we didn鈥檛 see a whole lot of traditional AI and SaaS activity in Q4.鈥�

His firm, which primarily invests in US and India-based companies in the mobile, cloud, and big data sectors, led a Series A in an undisclosed Dallas-based AI and SaaS company that will be announced later this month.

Looking ahead, Sharma hopes to see more funding in Dallas in 2019.

鈥淚 think there is a great new crop of early stage companies that are progressing well, and some of these are getting ready for Series A and B investments in 2019,鈥� he said. 鈥淚 think retail will continue to stay as a hot sector, and mobility will continue to pick up. From our investment thesis, we are excited to see more B2B enabling startups continue to make traction and get funding.鈥�

Texas In The Macro

While 2018 was a good year for Texas startups seeking capital, there is room for that to change, even if that change won’t be felt immediately.

鈥淚 think, at a macro level, activity was very strong as the year was quite hectic, both in terms of new company financings as well as follow-ons for portfolio companies,鈥� Shamapant told SA国际传媒 News. 鈥�2019 seems to be pointing towards a continuation of that right now.鈥�

However, he鈥檚 generally also realistic about the impact that the recent public market upheaval might have on private investing.

鈥淚 did private investing in the last two negative cycles,鈥� Shamapant told SA国际传媒 News. 鈥淯sually, there鈥檚 a lag between the two. In general, I think spend at all companies, when they see the public markets gyrate, gets to be more controlled. Plus, fully financed companies might not care about public market valuations over the next 18 months, but they will have to face the impact when they do come back to market.鈥�

鈥淭his is especially true of later stage companies,鈥� he continued. 鈥淪o you鈥檒l probably see some adjustments on valuations on those companies. Brand new investments are going to be relatively better insulated as long as they work on being capital efficient. Later stage companies are going to bear the brunt of it.鈥�

I, for one, am eager to see just how much closer Austin will get to living up to the hype surrounding it. I think the key here is patience and time. In the meantime, we鈥檒l see if both Austin and Houston continue to gain traction despite all the public market turmoil, and if Dallas can get out of its apparent slump.

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So, let鈥檚 cut to the chase: The bull run continues. Projected funding (see Methodology notes) for U.S. and Canadian startups was up across all stages on a quarter-over-quarter and year-over-year basis, driven by a surge in supergiant rounds.

For Q4 of 2018, venture and growth investors put an eye-popping $41.4 billion to work in U.S. and Canadian startups, according to SA国际传媒 projections.1 That鈥檚 a rise of 18 percent from the prior quarter and a jump of more than 50 percent from year-ago levels.

The full-year numbers also show a massive spike in investment. SA国际传媒 projects that investors put a staggering $136 billion into startups in all of 2018. That鈥檚 an increase of 41.5 percent from 2017 levels and the highest annual total in the history of the SA国际传媒 dataset.

Still, not everything in startup-land was looking quite so rosy. While venture capitalists outdid themselves pouring money into deals, their record for generating exits was less impressive. Tech IPOs were largely stagnant in Q4, and VCs notched just one multi-billion-dollar M&A exit during the quarter with SAP鈥檚 $8 billion purchase of Qualtrics.

Below, we break down the key data points and trends for the fourth quarter and full year, replete, as usual, with plenty of charts.

Q4 Mantra: Spend, Spend, Spend

Let鈥檚 start with the Q4 numbers. As mentioned previously, it was a spendy three months, and startups from seed through growth stage shared in the largess.

Looking at investment levels over the past five quarters in the chart below, the uptrend is quite clear. Total spending just keeps going up:

Now, let鈥檚 break down the quarterly numbers by stage.

Late Stage

Late-stage Q4 totals were particularly high. Of the projected $41.4 billion invested in the fourth quarter, about 52 percent, or $21.7 billion, went to late-stage deals (Series C and beyond, plus other round types). That鈥檚 a rise of 18 percent in dollar terms from the prior quarter and up a remarkable 53 percent from year-ago levels.

There were some unusually large late-stage rounds in the mix for Q4, including on record valued at $100 million or more. Recipients of some of the biggest rounds included grocery delivery service , spacetech pioneer , data warehousing provider , and custom microbe developer .

Round counts ticked up as well. A projected total of 318 startups announced late-stage financings in Q4, up 7 percent from the preceding quarter and 39 percent from year-ago levels.

In the chart below, we detail late-stage investment and round counts over the past five quarters:

Technology Growth

Meanwhile, technology growth2 investment, the most volatile stage in the SA国际传媒 dataset due to the small number of deals, showed the largest percentage rise. Projected total investment in Q4 of 2018 was $4.3 billion, more than double Q3 levels.

That said, most of the Q4 total came from a single deal: a $3 billion SoftBank investment in . We have more details for tech growth deal making for the past five quarters in the chart below:

Early Stage

Venture investment at the early stage (Series A and B, plus a subset of other round types) did not show the same sharp rise as late and tech growth stage in Q4. Nonetheless, investment levels were up from both prior quarter and year-ago levels.

In all, investors put a projected $14 billion to work in U.S. and Canadian early-stage startups in Q4. That鈥檚 a rise of 11 percent from the third quarter and 26 percent from the same period a year ago.

A plethora of extra-large rounds boosted the totals. At least closed Series A and B rounds of $100 million or more, including $385 million for car leasing startup and $300 million for healthcare plan provider .

While investors backed bigger early stage deals, they didn鈥檛 close a lot more rounds, at least not quarter-over-quarter. Projected fourth quarter round counts totaled just over 1,400, up incrementally from Q3, and a rise of over 20 percent from year-ago levels.

In the chart below, we lay out early-stage numbers and round counts over the past five quarters:

Seed

Investment in seed stage startups hit its highest total in five quarters in Q4. SA国际传媒 projects that investors put $1.76 billion into just over 1,800 startups in the just-ended quarter.

The boost in seed-stage investment resulted from bigger deals, not more of them. 听In dollar terms, investments were up 27 percent from the prior quarter and 30 percent from year-ago levels. However, projected round counts dipped some, falling about 13 percent from Q3 levels.

In the chart below, we lay out the projected seed-stage investment totals and round counts for the past five quarters:

2018 Was Very Spendy Too

Now let鈥檚 turn to the full-year numbers for 2018. As noted earlier, it was a year of extraordinarily high startup investment levels, the highest since SA国际传媒 began tracking this stuff.

In all, SA国际传媒 projects that investors put just over $136 billion into U.S. and Canadian startups during the calendar year, with the largest chunk going to late-stage deals. Supergiant financings lifted the totals, with at least of $100 million or more announced in 2018.

In the chart below, we compare 2018 funding totals by stage to the prior four years. It shows 听funding levels hitting multi-year highs across stages:

The late-stage funding totals for 2018 warrant particular attention. Over the course of the year, investors put an unprecedented $71 billion into venture deals at Series C and later, led by enormous rounds for construction tech unicorn , , and Instacart.

Round Counts

As total investment soared in 2018, deal counts rose as well, but by a smaller degree. SA国际传媒 projects around 14,800 rounds closed in the course of the year across all stages, up about 20 percent from 2017. We compare total counts by stage for the past five years in greater detail in the chart below:

Most Active Investors

While startups are raising more money, they鈥檙e largely raising it from the same firms that backed them when typical round sizes were much smaller.

A SA国际传媒 compilation of the most active investors in early and late-stage startups shows familiar names topping the lists.

In the chart below, we look at the most active early-stage investors, based on reported data, topped by , and followed by (NEA) and :

Next, we look at the most active late-stage investors (again, based on reported data), a list also led by well-known firms including NEA, and .

(Not) Heading For The Exits

Thus far, our number-crunching for Q4 and 2018 has featured a lot of upbeat trend lines about growing investments. As we turn to exits, however, the picture gets murkier.

While there were some big exits in the just-ended quarter and the past year, the money investors took out of their existing investments doesn鈥檛 appear to come close to rivaling the sums put into new ones.

Q4, in particular, was a slow period for technology IPOs, with just : , , and . Biotech offerings fared better, with about a from VC-funded companies.

There were several good-sized acquisitions of venture-backed companies as well in Q4, albeit only one blockbuster deal: SAP鈥檚 $8 billion purchase of , a profitable enterprise software provider that had been on the verge of going public. The second-largest M&A deal of the quarter was Blackberry鈥檚 $1.5 billion purchase of cybersecurity startup , followed by Autodesk鈥檚 purchase of construction software developer .

As for 2018 as a whole, investors churned out a number of big exits, including IPOs of unicorns like , , and 听. Biotech IPOs rolled out a brisk pace. 听And M&A chugged along, with an estimated involving venture-backed companies. Of those, Qualtrics and (acquired by Microsoft for $7.5 billion) commanded the largest sums.

Conclusion

So, investment levels for 2018 were off the charts. Given that, one could make a case that the startup fundraising environment this past year showed a lot of traits associated with cyclical peaks. Also, given the less buoyant public market environment over the past few months, one could also make a case that a private market pullback is likely to follow.

That said, there鈥檚 still a lot of dry powder in venture firm coffers, thanks to a blockbuster fundraising year. There鈥檚 also plenty of excitement in startup circles around expectations for a herd of unicorns stampeding to exit in coming months. Uber and Lyft have already filed for IPOs, while Pinterest and Slack are reportedly planning to do so shortly.

What does that mean for the year ahead? After closing out 2018 as the year of the supergiant funding round, investors are now hoping 2019 will be the year of the supergiant exit. Of course, we鈥檒l have to wait and see.

Methodology

About Projected Data

There is often a delay between when a venture capital deal is closed, and when it鈥檚 publicly reported and captured by SA国际传媒. Accordingly, SA国际传媒 compensates for this pattern of delays by scaling reported (e.g. currently known and recorded in SA国际传媒) data up in proportion to historical patterns of undercounting and late reporting.

Glossary of Funding Terms

For reporting purposes, SA国际传媒 aggregates its funding data into “stages,” reflecting the different phases of private company development. Rounds are classified by stage according to the following sets of rules.

• Angel & Seed-stage is comprised of seed, pre-seed, and angel rounds. SA国际传媒 also includes venture rounds of unknown series, transactions of undisclosed type, and convertible notes totaling $1 million (USD or as-converted USD equivalent) or less. Equity crowdfunding rounds with no listed dollar value, as well as those totaling less than $5 million, are also counted as seed-stage.
• Early stage is comprised of Series A and Series B rounds, as well as other round types. SA国际传媒 includes venture rounds of unknown series, transactions of undisclosed type, and convertible notes totaling between $1,000,001 and $15,000,000. Convertible note rounds with missing dollar values are also counted as early-stage.
• Late stage is comprised of Series C, Series D, Series E, and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, transactions of undisclosed type, and convertible notes of $15,000,001 or more.
• Technology growth is a private equity round raised by a company that has previously raised a “venture” round. (So, basically, any round from the previously-defined stages.)

Note: Fundings denoted by SA国际传媒 as corporate rounds are not included in SA国际传媒 stage classification metrics and therefore do not get included in annual and quarterly startup investment totals. In some instances, this will impact totals to a significant degree. (In Q4 of 2018, for instance, SA国际传媒 did not include the $13 billion Altria investment in e-cigarette maker Juul as a venture round.)

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Like with our Q4 2018 global investment report, which covered the money going into startups, this piece鈥攆ocusing on money coming out of the same companies鈥攆eatures a couple of takeaway points to make this report just a little more digestible.

• Bullish Key Finding. The IPO market was fairly robust throughout much of 2018. Additionally, dollar volume generated from M&A of venture-backed companies topped 2017鈥檚 totals, indicating that the average transaction size is going up.
• Bearish Key Finding. Acquisitions of venture-backed companies continued sliding downhill, producing the first year-to-year decline in a long time. Also, public market volatility doesn鈥檛 bode well for a handful of companies hoping to jump through the IPO window in 2019.

Money Out

There are three primary ways shareholders (investors, founders, and employees) are able to get money out of a private company: by selling that company to another, by taking the company public in an initial public offering (IPO), or through a sale of stock through the secondary market.

Venture-Backed Acquisitions

One of the most common routes to a financial 鈥渆xit鈥� is through mergers and acquisitions. If a company is bought for cash or stock in a public company, shareholders might get some of those proceeds, depending on the terms of the deal and the seniority of any given shareholder.

In the chart below, we show reported venture-backed startup M&A activity over time. This is based on reported data aggregated by SA国际传媒.

Before continuing, keep in mind that there are sometimes reporting delays for acquisitions, and acquisitions that took place in the past are added to SA国际传媒 regularly. In other words, these numbers may be subject to change over time. At the same time, they shouldn鈥檛 shift much. Bigger deals tend to be reported and added to SA国际传媒 in close to real time.

Reported exit deal volume led a slow but steady march downward throughout the final quarter of 2018, as the chart above shows. The impact of this trend is finally being felt on a larger timescale. Of all the M&A events captured by SA国际传媒 in 2018, 1,376 were for companies with known VC backing. That鈥檚 down from 1,429 deals reported in 2017.

Reported dollar volume grew since Q3. Some of the nearly $20 billion gain is no doubt attributable to buyouts of companies like , which . Qualtrics had over the course of prior to its acquisition.

Annual dollar volume is up relative to last year, with just under $158 billion getting cleared in 2018, compared to $146.3 billion in reported M&A dollar volume in 2017.

And here are some of the biggest highlights from the year.

Let鈥檚 take a look at the other primary way shareholders can cash in their equity.

Initial Public Offerings

Getting your private company listed on a public exchange, typically via an initial public offering, is the second main path to liquidity. There are some that have gone public through alternate means, most notably , which completed a direct listing in April, a move that SA国际传媒 News documented prodigiously.

The IPO market in 2018, on the whole, was fairly robust. But it was slightly less active in the final quarter of the year. A few U.S. tech companies floated shares, but only at the beginning of the quarter. Between October 2 and October 5, freelance marketplace , search and analytics company , and enterprise SaaS platform , all went public. Following that crazy week, a few China-based companies debuted on U.S. markets, but offerings from the likes of and underperformed expectations. Q4鈥檚 may have tempered or delayed other companies鈥� bids to go public.

Here鈥檚 a selection of some of the biggest IPOs by venture-backed companies throughout 2018.

And here鈥檚 an even more comprehensive list of companies that have gone public in 2018.

Secondary Market Transactions

The third main route to liquidity is by selling shares on the secondary market. We鈥檙e not going to go into too much depth here, because often go unreported, and there isn鈥檛 enough data available to suss out many trends in this facet of the market.

There is considerable friction involved in these transactions. Assuming the company stockholder is able to navigate the applicable securities laws and shareholder covenants that may be unique to that company, there鈥檚 still the fact that secondary markets aren鈥檛 very liquid, and there are regulatory hurdles prospective buyers must clear to acquire those shares.

This being said, as companies raise more capital from private markets, they can take more time to go public. Accordingly, in 2018 many companies initiated secondary sales and to give some shareholders the ability to cash out. As one example, in May, Uber shareholders with more than 1,000 shares were given the opportunity to sell up to $10 million worth of stock as part of a involving investment firms , , and , according to reporting from and .

Looking Ahead To 2019

All eyes will be on ride-hailing giants and , both of which filed initial IPO paperwork with the SEC in mid-December.1 With between the two competitors, any public offering, even a lackluster one, could bring a major cash windfall to each company鈥檚 investors.

Following the success of Spotify鈥檚 direct listing, more companies may pursue that route in 2019. In December, that ( in total backing) and ($1.2 billion in total backing) may list their shares directly on public exchanges, largely cutting out the investment banks that traditionally underwrite initial public offerings.

There are plenty of other companies that might go public in 2019. As of October 2018, was in talks with JP Morgan Chase and other investment banks to underwrite an IPO. Also as of October, was in talks to go public in 2019. , , , and others are also potentially in the running.

But if stock market volatility continues, it鈥檚 possible that some, but not all, of these 2019 IPOs may be put on ice until conditions improve. Here鈥檚 to hoping that doesn鈥檛 give investors cold feet.

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This report from SA国际传媒 News will assess the state of the global venture capital market in the last quarter of 2018, and in the year as a whole. Like always, we鈥檒l do so primarily through the lens of data.

We will cover SA国际传媒鈥檚 projections of how鈥攁nd how much鈥攖he global venture capital ecosystem invested in Q4 2018 and throughout the year as a whole. We鈥檒l then evaluate how that result compares to both Q3 2018 and Q4 2017, giving us perspective on sequential quarter and year-over-year performance. (More about how those projections are calculated, and how rounds get classified into stages, can be found in the Methodology section at the end.)

IPOs and M&A will be covered in a separate report to be published following this one.

Before getting into the thick of SA国际传媒 News鈥檚 global investment report, here鈥檚 something to whet your appetite.

2018: Last Year In Three Charts

In 2018, venture capital got bigger and continued to expand globally.

SA国际传媒 News documented an emerging trend in VC: the tendency for some companies to raise $100 million or more in a single round of outside funding. Just like shine brightest and stretch the fabric of space and time, supergiant venture rounds of $100 million or more dominate the headlines and bend the fundraising curve for founders and investors alike.

In the chart below, we鈥檝e plotted the count of reported supergiant venture rounds in 2014 through 2018, broken out by month. It looks like the July peak of over 60 supergiant deals remains the local maximum.

It鈥檚 easy to see that supergiant rounds have become more numerous. But what might be less clear, from the above chart alone, is just how much money these companies command. Below, we plotted the share of reported venture capital raised in supergiant rounds over that same timeframe, this time aggregating by quarter. (Note: this doesn鈥檛 account for money raised in deals from 2018 that are added to SA国际传媒 after publication.)

In all of 2018, over 56 percent of the reported capital raised by private tech companies was closed in supergiant venture funding rounds. Reported data in SA国际传媒 indicates that Q4 2018 was the most concentrated in years, with 61 percent of VC funding coming from nine, ten, and eleven-figure transactions.

SA国际传媒 News previously reported on the ratio of supergiant deals closed by China-based companies, as compared to their counterparts in the U.S. Back in August, U.S. and Chinese companies were basically neck-and-neck, but it appears as though China鈥檚 Q4 economic slowdown stymied growth in this metric. Reported data shows that U.S. companies raised 64 supergiant funding rounds in Q3 and 63 in Q4. According to reported figured in SA国际传媒, Chinese companies raised 56 supergiant rounds in Q3, but just 39 in Q4. Meanwhile, companies based outside the world鈥檚 two largest economies raised 40 supergiant rounds in Q4, compared to 28 in Q3.

In the first and second quarters of 2018, Chinese VC dollar volume surpassed the United States for the first time. But international growth and a contraction in China put U.S. companies back at the top of the international ranks.

In Q4, China-based companies raised just over 21 percent of the reported funding during the quarter, relative to the 53 percent netted by U.S. companies.

It鈥檚 uncertain whether 2019 will (or even can) top 2018, but the globalization of VC is here to stay. At least for the time being, though, the status quo prevails: U.S. startups remain at the top of the global VC-raising heap.

Money In

• Bullish Key Finding. Full-year deal and dollar volume eclipsed 2017 by wide margins.
• Bearish Key Finding. On a quarter-by-quarter basis, venture funding activity appears to be leveling off or decreasing across some stages.

Pace of Dealmaking

If the last section felt like a salad course, here鈥檚 where we start the main dish.

The number of venture capital deals struck during a given period of time tells us how fast the market is moving. Q4 brought the pace down from ludicrous speed to merely insanely fast.

Note that these numbers are divided up by stage. A 鈥渟tage鈥� of funding is comprised of several types of rounds, classified according to a set of criteria defined by SA国际传媒.

For example, 鈥渆arly stage鈥� includes:

• Series A and Series B rounds (regardless of size).
• Venture rounds of unknown series, convertible notes, and rounds of undisclosed type, so long as they鈥檙e between $1,000,001 and $15,000,000 or USD equivalent (in the case of foreign currencies).
• Equity crowdfunding rounds between $5,000,001 and $15,000,000.

Collectively, those subsets are aggregated into a single stage. Similarly, seed and late-stage, as well as technology growth rounds, have their own set of classification rules. You can read more about those in the Methodology section at the end.

SA国际传媒 projects that a total of 8,607 venture deals were struck in Q4 2018 worldwide, down 3.55 percent from last quarter鈥檚 total of 8,924 deals.1 That鈥檚 off about 6 percent from Q2鈥檚 highs, which isn鈥檛 much by standards of this venture market, where bigger moves happen regularly. For example, total deal volume surged up 24 percent between the first and second quarters of the year.

It was, in part, that explosion in projected deal volume, led by angel and seed-stage, that propelled venture deal volume to such great heights in 2018.

With just over 34,000 deals projected for all of 2018, last year was the most active on record. Overall deal volume jumped by over 32 percent since 2017.

There鈥檚 an important note to make about these projections. When SA国际传媒 News pulled data for this report on January 1, 2019, SA国际传媒 had recorded a total of 21,865 deals for all of 2018. Based on historic patterns of venture deal reporting, SA国际传媒鈥檚 projections try to compensate for the deals that have likely been struck but haven鈥檛 yet been publicly disclosed or added to SA国际传媒. These projections are applied to the most recent SA国际传媒鈥檚 projections indicate that slightly over 12,000 deals will be back-filled into 2018 over time. A lot of those will be angel and seed-stage deals, with are typically the slowest to be reported. More information about reported versus projected data can be found at the end of this report.

It鈥檚 easy to see that growth in deal volume was largely driven by angel and seed-stage deals. You鈥檒l see why in a later section when we approach the market stage by stage.

Projected VC Dollar Volume

If deal volume is like a speedometer, dollar volume is better thought of as a pressure gauge. This measure of capital throughput tells us how companies (and their backers) view the market.

A market awash in cash points to both optimism (after all, investors believe their capital will earn a good return even at this late stage of the market cycle) but, also, a more competitive business climate. As industries develop and established players dig their trenches, it takes increasingly large amounts of money to get a leg up on the competition.

SA国际传媒 projects that overall dollar volume is up, once again, in the final quarter of the year. Data in the chart below is subdivided by stage.

Note that SA国际传媒 doesn鈥檛 incorporate the 鈥淐orporate Round鈥� type into its projections. Accordingly, in November 2018, which SA国际传媒 classifies as a corporate round, is not counted in the chart below.

A resurgence in late-stage venture funding drove the global market鈥檚 dollar volume totals higher in the final quarter of 2018. SA国际传媒 projects that roughly $91.4 billion was invested in Q4, up about 2.4 percent from Q3.

This rounds out two solid years of quarter-over-quarter growth. According to SA国际传媒 data, global dollar volume figures increased every quarter since Q4 2016. Zooming out to annual numbers for a moment, the results of that consistent growth become readily apparent.

In 2018, private companies raised over three times as much capital as they did just four years prior. Data in the chart below is broken out by stage.

On an annual timescale, all three main stages of venture funding saw major growth in dollar volume. (Money shifted out of technology growth-stage deals for reasons we鈥檒l highlight later.) Growth in early and late-stage dollar volume drove most of the overall gains.

Here too we鈥檇 like to explain a bit how the projections were calculated. As of January 1, 2019, SA国际传媒 had recorded $293 billion in venture funding. However, SA国际传媒 projects that $48.56 billion worth of venture investment deals that occurred in 2018 will be added over time.

Recall that this is subdivided by 鈥渟tage,鈥� which includes more than neatly-labeled rounds following the typical 鈥淪eries [sequential letter]鈥� naming convention. Because they include rounds of unknown round series and unknown funding types, this 鈥渟tage鈥� definition is quite expansive.2 SA国际传媒 recorded $293 billion worth of deals in 2018 when aggregated by stage. By comparison, SA国际传媒 captured roughly $205 billion worth of neatly-labeled seed, angel, and rounds from Series A onward during the year. We report projections based on stage as it provides a broader look at the global venture market than what can be readily apportioned into neat buckets.

Most Active Lead Investors In 2018

In venture funding rounds with more than one investor involved, typically there will be one (but sometimes more) firm that invests the bulk of the capital and steers most of the negotiations in a given deal. Let鈥檚 take a look at which firms were the most active throughout 2018.

The chart below shows the investors which are reported to have led the most rounds. For most deals in SA国际传媒 with investor information included, the data designates which investors led a round, versus those which just participated or followed-on.

In the set of 2018 venture rounds, we identified nearly 6,800 unique investors which led a deal last year. Of these, here are the firms which led the most rounds.

Note that the above data is subject to change as more rounds get added to SA国际传媒 over time. There鈥檚 strong representation from the U.S. and China, and some representation for Chile (via ) and the United Kingdom (by way of the ). There is a very long tail of investors which led fewer than 33 deals in 2018, and that鈥檚 where more of the geographic diversity can be found.

Stage-By-Stage Analysis of Q4 2018 VC Funding Trends

In this section, we鈥檒l take a look at each stage in turn, getting into the nitty-gritty details. As usual, we start 鈥渃lose to the metal鈥� with angel and seed-stage deals.

For more about how SA国际传媒 classifies rounds by stage, check out the Methodology section at the end.

Angel And Seed-Stage Deals

What angel and seed-stage deals lack in size, they make up for in number. In Q4 2018, angel and seed-stage activity accounted for approximately 59 percent of all deal volume, but just five percent of total dollar volume. Those ratios are representative of 2018 as a whole. (More information about what types of rounds get counted in this stage can be found in the Methodology section at the end.)

Although 2018 as a whole was a year of phenomenal growth, SA国际传媒 projections indicate that things cooled down a bit in Q4.

Between Q3 and Q4, both deal and dollar volume declined somewhat. A pull-back is inevitable after a period of consistent growth. But, this being said, a contraction here may indicate increased caution on behalf of investors on the riskiest end of the capital pool.

But an end-of-year slowdown doesn鈥檛 do much to dent the annual numbers. According to projections from SA国际传媒, approximately 20,250 angel and seed-stage transactions took place in 2018, a significant jump from 2014-2017鈥攄uring which time aggregate seed-stage deal volume ranged between roughly 14,100 and 15,700 deals. Yearly totals for angel and seed-stage dollar volume also rose markedly. For the entirety of 2018, SA国际传媒 projections indicate that $14.94 billion was invested in seed-stage deals. That鈥檚 an over 50 percent increase from 2017鈥檚 total of $9.717 billion.

A good chunk of that growth can be attributed to increasingly large sums raised by angel and seed-stage ventures.

It鈥檚 not just deal and dollar volume that grew so significantly. Seed-stage rounds鈥攚hich also include angel funding, pre-seed deals, and other funding types鈥攇rew larger over the course of 2018.

SA国际传媒 data included over 7,500 unique investors which led or participated in angel or seed-stage rounds last year. Here are most active among them.

There aren鈥檛 many surprises here in the overall makeup of this list, and it includes many different types of investors, all of which seek stakes in seed-stage startups.

Accelerator programs take most of the top spots; after all, it鈥檚 a model designed to deploy capital at scale. For example, 鈥檚 鈥渄emo day鈥� for its Summer 2018 batch , and its Winter 2018 batch . and run multiple sessions around the world every year. bills itself as 鈥渢he accelerator VC.鈥�

In addition to these, though, there are government-backed programs intended to kickstart innovation. Hungarian , for example, continued investing much of the it raised across funds in 2017. , which offers international entrepreneurs work visas and equity-free funding, in 2018, after several quiet years. Add in university-based initiatives like the , an equity crowdfunding platform like , a few seed-focused funds, and that rounds out the basic set of institutional investors involved at this stage.

Of course, there鈥檚 also the largely incalculable amount of money solo founders and fledgling companies raised from individual angel investors and through informal 鈥渇riends and family [and fools]鈥� rounds. Those small but numerous transactions are difficult to track, but they no doubt add up.

Early-Stage Deals

Early-stage companies raise more money than their seed-stage counterparts. In Q4 2018, early-stage deal volume accounted for approximately 33 percent of all deal volume and 32 percent of total dollar volume. Those ratios are at the low end of 2018 as a whole. For example, a Q3 pullback in late-stage investment meant early-stage deals accounted for an even third of deal volume but 39 percent of dollar volume.

And like with seed-stage deals, there was a quarterly decline in dollar volume.

That鈥檚 because Q3 was extraordinary. Notice how dollar volume grew steadily by $2-4 billion, per quarter, over most of the past year鈥攚ith the exception of the $7.2 billion jump from Q2 to Q3. Q4鈥檚 dollar volume results are a reversion to the mean. Deal volume is projected to be basically flat after a down quarter in Q3 but is still near historically high levels.

2018 was a record-setting year in early-stage venture. According to projections from SA国际传媒, approximately 11,250 early-stage transactions took place in 2018, worldwide, another significant jump from 2014-2017. Yearly totals for early-stage dollar volume also went up. SA国际传媒 projections indicate that $117.65 billion was invested in early-stage deals over the course of 2018. That鈥檚 an over 57 percent upswing from 2017鈥檚 total of $74.9 billion.

There were certainly more deals in 2018, but they weren鈥檛 necessarily that much bigger than they have been in the immediate past.

Early-stage rounds are larger than they were a year ago, but by a narrower margin than seed-stage deals.

Over 8,500 unique investors contributed to early-stage funding rounds in 2018. And here are the most active early-stage investors, worldwide, in the last year.

It鈥檚 in these ranks that we start to see the increasingly dominant role China-based investors are occupying on the world stage. Many of the institutional investors listed above are either headquartered in China, or are investing capital from Chinese limited partners. Beijing-based 鈥攚hich this year saw portfolio companies , , and (among ) exit鈥攖ops out the annual ranks. China-based offshoots of U.S. venture capital franchises, like and , struck more deals than their American counterparts. This is a material shift from 2017, when the only China-connected firm to crack the top ten rankings was , a cross-border firm with offices in the U.S. and China.

Late-Stage Deals

Late-stage reigned. In Q4 2018, late-stage deal volume accounted for just 7 percent of all deal volume, but 55 percent of total dollar volume. As previously mentioned, due to variation in market conditions this year, late-stage deal volume accounted for as much as 61 percent of dollar volume in Q2, and as little as 51 percent in Q3.

At least part of that quarterly variability can be accounted for by the enormity of the largest rounds at this stage. For example, raised by China-based in June remains the largest-ever venture capital transaction to date. That boosted Q2鈥檚 numbers significantly. Not all rounds need to be that gigantic to shift dollar volume results; a cluster of merely huge nine and ten-figure rounds can change the shape of the market. Q4 appears to carry on a steady upward trend in both late-stage deal and dollar volume.

Now let鈥檚 look at 2018 as a whole. According to projections from SA国际传媒, approximately 2,330 late-stage transactions took place in 2018. That鈥檚 an over 40 percent jump from 2017鈥檚 projected total of just over 1,600 deals. Yearly totals for late-stage dollar volume rose. For the entirety of 2018, SA国际传媒 projections indicate that a staggering $192.2 billion was invested in late-stage deals, worldwide. Jumping over 80 percent, 2018鈥檚 late-stage deals hauled in nearly twice 2017鈥檚 total of $104.9 billion.

In 2018, more money was invested in late-stage ventures than the entire global VC market invested in 2016 (approximately $168 billion, total). Late-stage rounds are bigger now than a couple of years ago, but on the whole they haven鈥檛 grown much over the past several quarters.

Despite some movement on a quarterly basis, late-stage venture rounds are roughly the same size as they were during the same period in 2017 before the supergiant round phenomenon came to a head in the late summer of 2018.

More than 3,200 unique investors participated in late-stage venture deals in 2018. Here are the most active among them.

As with ranks of early-stage investors, international representation is strong here.

There are U.S. and Chinese funds, as well as , which is backed by the government of Singapore. The is nominally led by , CEO of Japan-based . Its main office is in London, but it鈥檚 legally domiciled in Jersey (that鈥檚 Old Jersey, a small island off Great Britain with convenient tax structuring). The nearly $100 billion Vision Fund invests capital from global technology giants like , , , and , as well as sovereign wealth from Abu Dhabi and, perhaps problematically, Saudi Arabia.

Many of the U.S.-based firms listed above have country-specific offshoots, expanding the scope of the global venture capital industry. Take , for example, which has subsidiary investment firms in and (each of which manages billions of dollars), on top of a possibly $8 billion global growth fund that Sequoia Capital is raising itself.

Also notable is all the corporate investors, which isn鈥檛 surprising considering how much corporate venture capital (CVC) grew over the past couple of years. SA国际传媒 News has covered several of these investors this year. We profiled Tencent and Alibaba鈥檚 investment efforts back in January. And in a profile of corporate venture capital (CVC) investments, SA国际传媒 News plotted out Goldman Sachs鈥檚 rise to the top of the most-active CVC charts.

Technology Growth Deals

Since Q4 2017, SA国际传媒 has defined technology growth rounds as the set of private equity deals raised by companies with prior venture backing. from November is a great example of a 鈥渢echnology growth鈥� deal. (To learn more about the old definition of technology growth and why SA国际传媒 changed it, check out the Q4 2017 Global Report.)

Because technology growth deals are relatively few and far between and vary so much in size, sussing out trends from deal and dollar volume is difficult. However, in general, the same market forces driving fundraising at the latter end of the late-stage spectrum apply here.

Shifts in the late-stage market may finally be having an effect. SA国际传媒 projections indicate that throughout the whole of 2018, roughly $16.76 billion was invested in technology growth deals, down by 78 percent from 2017鈥檚 total of $29.86 billion. This being said, projected technology growth-stage deal volume is up 24 percent, from 147 transactions in 2017 to 194 transactions in 2018.

Previously venture-backed companies raised less in pre-IPO private equity rounds, but mostly because VCs are increasingly raising growth-stage funds to fuel companies further into the business lifecycle. In other words, dollar volume shifted away from tech growth rounds to late-stage as better-capitalized VCs now have the financial wherewithal to invest at a scale previously accessible to big-dollar PE firms.

As mentioned earlier, it鈥檚 tough to tell too much from the numbers, because there aren鈥檛 a lot of these deals. Nonetheless, it鈥檚 worth noting that the median deal size has now crept into supergiant territory.

Though SA国际传媒 News doesn鈥檛 typically cover a lot of private equity transactions, which are rarely cut-and-dry. Our coverage of a two-part $35 million PE deal with Tango Card (itself a tech growth deal) highlights that. This being said, we did cover some other technology growth deals in 2018. We profiled WP Engine, which raised a $250 million private equity round at the beginning of the year, and we also touched on Tanium鈥檚 $175 million PE deal back in May.

And with that, we close out the Money In. Now the challenge will be getting that money out. That鈥檚 what we鈥檒l cover in a follow-up companion report focused on liquidity.

Conclusion

It鈥檚 going to be difficult to top 2018. And there鈥檚 a lot to suggest that the best times may be in the rearview mirror. After close to a decade of post-Great Recession boom times, some sort of serious slowdown is all but guaranteed sometime in the next few years. Will 2019 be that year? Maybe.

The Federal Reserve is signaling intent to hike interest rates in 2019, and public stock market volatility is spiking on global uncertainty. A lot of how the global economy will proceed depends on some key political decisions: the Brexit negotiations in the U.K., how the U.S. and China move past the detente in the ongoing trade war, and what, if any, consequences members of the U.S. executive branch may face for prior actions.

As global growth is , some of the biggest winners of this past market cycle are expected to graduate to public markets. Though, the question of what鈥檚 going to be left to fund after a lot of folks try to find an exit is probably more of a 2020 challenge, barring calamity.

Methodology

The data contained in this report comes directly from SA国际传媒, and in two varieties: projected data and reported data.

SA国际传媒 uses projections for global and U.S. trend analysis. Projections are based on historical patterns in late reporting, which are most pronounced at the earliest stages of venture activity. Using projected data helps prevent undercounting or reporting skewed trends that only correct over time. All projected values are noted accordingly.

Certain metrics, like mean and median reported round sizes, were generated using only reported data. Unlike with projected data, SA国际传媒 calculates these kinds of metrics based only on the data it currently has. Just like with projected data, reported data will be properly indicated.

Please note that all funding values are given in U.S. dollars unless otherwise noted. SA国际传媒 converts foreign currencies to US dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs, and other financial events as reported. Even if those events were added to SA国际传媒 long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of Funding Terms

For reporting purposes, SA国际传媒 aggregates its funding data into “stages,” reflecting the different phases of private company development. Rounds are classified by stage according to the following sets of rules.

• Angel & Seed-stage is comprised of seed, pre-seed, and angel rounds. SA国际传媒 also includes venture rounds of unknown series, transactions of undisclosed type, and convertible notes totaling $1 million (USD or as-converted USD equivalent) or less. Equity crowdfunding rounds with no listed dollar value, as well as those totaling less than $5 million, are also counted as seed-stage.
• Early stage is comprised of Series A and Series B rounds, as well as other round types. SA国际传媒 includes venture rounds of unknown series, transactions of undisclosed type, and convertible notes totaling between $1,000,001 and $15,000,000. Convertible note rounds with missing dollar values are also counted as early-stage.
• Late stage is comprised of Series C, Series D, Series E, and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, transactions of undisclosed type, and convertible notes of $15,000,001 or more.
• Technology growth is a private equity round raised by a company that has previously raised a “venture” round. (So, basically, any round from the previously-defined stages.)

Note: Fundings denoted by SA国际传媒 as corporate rounds are not included in SA国际传媒 stage classification metrics and therefore do not get included in annual and quarterly startup investment totals. In some instances, this will impact totals to a significant degree. (In Q4 of 2018, for instance, SA国际传媒 did not include the $13 billion Altria investment in e-cigarette maker Juul as a venture round.)

Illustration:听