VC Momentum Continues for Q2 2019

August 22, 2019

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With his pulse constantly on the Venture Capital market, EisnerAmper director Alan Wink examines Q2 2019. He tells us if we are on pace to match 2018’s record year, what’s on tap for the next quarter, and if this will go down as the year of the mega deal.

 


Transcript

Dave Plaskow: Hello and welcome to EisnerAmper’s podcast series. We're always interested in the latest trends and developments as well as any related business and accounting opportunities and challenges. Today we're taking a look at the venture capital landscape for the second quarter of 2019. I'm your host, Dave Plaskow, and with us, as always, is Alan Wink, a director for EisnerAmper’s capital markets. Alan, welcome and thanks for being here.
Alan Wink: Morning Dave. How are you?

DP: Good. Give us the headline for the second quarter of this year.
AW: I think there's a couple of headlines. Number one: investment continues at pretty high levels. Maybe not as at a high level as 2018, but certainly high. 66 billion invested through the first six months of 2019 puts us on track to have the second consecutive year of $100 billion-plus of Venture Capital investment. The real highlight of the second quarter was the exit market. There's already been $138 billion of VC-backed exit value in the second quarter of 2019, which really came about because of 34 VC-backed IPOs. If you look at the first six months of 2019, already $188 billion of exit value, which is already more than any other year in prior history. First six months greater than any year on record. I guess the third point about Q2 and the first half of 2019 is the continuing of the mega deal. Deals in excess of $100 million in investment value are still continuing to percolate. I think about 45% of dollars invested in the first six months in ‘19 were in mega deals.
DP: Okay. Any specific industries you're seeing?
AW:Let's look at exit value first. About 49% of the exit value was in the Uber deal. It was a huge deal for everyone. The mega deal is really happening across the board. You’re seeing a lot in the life sciences space. You're still seeing a lot in the tech industry.
DP: I'm reading that WeWork might go public in September.
AW:That's correct. There are already 14 venture-backed companies in IPO registration, which are going to go public probably in 2019. So I think the frothiness of the IPO market will continue at least through the end of this year, unless there's some event on the world stage that changes that. But I'm pretty optimistic it's going to continue for this year.
DP: Well, great. Alan, as always, thanks for your expertise and your insight.
AW:Thanks Dave. I look forward to talking next quarter.
DP: And thank you for listening to the EisnerAmper podcast series. Visit eisneramper.com for more information on this and a host of other topics, and join us for our next EisnerAmper podcast when we get down to business.

About Alan Wink

Mr. Wink assists clients with capital budgeting, capital structuring and capital sourcing. He has worked with many tech and life science companies on developing the appropriate capital structure for their position in the business life cycle.

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