Editor’s note: Pitchbook and the National Venture Capital Association (NVCA) released venture capital data from the 4Q 2017 on Tuesday in their quarterly PitchBook-NVCA Venture Monitor report. After a series of articles from WRAL TechWire focused on parsing apart the data and what they say about trends in the Triangle, the state, and nation, we now compare the report with additional reports from Dow Jones and PwC/CB Insights released this week.

Two more reports compiling and analyzing venture capital activity were just released— PwC/CB Insights’ Q4 2017 MoneyTree Report and Dow Jones VentureSource. Both differ slightly from each other and the Pitchbook-NVCA report but identify the same overall key trends—over $70 billion in venture capital was invested in U.S. companies in 2017, most of the investments were made in large amounts in late-stage companies, and the number of seed deals dropped.

There’s some key differences and discrepancies between the reports too. For example, the PwC/CB Insights Money Tree report is a quarterly report for Q4 2017 and doesn’t provide data for all of 2017 while the other two reports provide both Q4 and all of 2017. And there’s a $72 million discrepancy between Dow Jones’ VentureSource report and the Pitchbook-NVCA Venture Monitor report when looking at the reported amount of capital invested in North Carolina-based companies.

The Dow Jones report says NC companies raised $884.16 million while the Pitchbook-NVCA report says they raised $956.31 million. The difference is a result of methodology—Colleen Schwartz, SVP of Communications at Dow Jones says Dow Jones counts “all equity transactions for firms that have received at least one institutional round of venture capital” which excludes companies that have only raised angel funds to date.

Understanding the differences is important so an accurate picture of the venture capital ecosystem can be assessed. However, the combination of all three reports provides a more robust picture of the market and trends than any one report provides on its own.

Dow Jones VentureSource Report

As previously noted, the major difference between the Dow Jones report and the Pitchbook-NVCA report is caused by a methodological difference. But other minor differences provide additional insights into 2017’s venture capital ecosystem not found in the Pitchbook-NVCA or the PwC/CB Insights report.

One big difference is the VentureSource report breaks industries into sub-categories for more granular analysis. For example, investments in “consumer goods” companies are tallied overall, then also broken down into four subcategories: food and beverage, household and office goods, personal goods, and vehicles and parts. Meanwhile, the NVCA data has one category, “consumer goods and recreation.” So, in any given quarter between 2010 and 2017, the data can show how many deals and how many funds were invested in a food and beverage company in NC.

The report also provides the median amount raised per industry nationwide, so any company who has raised funds can check their raise against the median amount in their industry to see how it compares. For instance, the median amount of VC raised by an IT company in 2017 was $6 million. For Healthcare companies it was $10.25 million, and for consumer goods it was $6 million.

Given that Pendo raised $25 million, it far outranked the median IT company raise, as did Micell Technologies whose $61.78 million raise far surpasses the healthcare median of $10.25 million. And Mati Energy’s $9.67 million raise overshoots the median consumer good raise by over $3 million.



PwC/CB Insights Q4 MoneyTree Report

This report, released quarterly, provides regional and global data on venture capital investments and trends for three continents— North America, Europe and Asia. It does not break down data by state, though. So, the report cannot be used to compare North Carolina or it’s regions to other regions or states.

The data is mostly consistent with the Pitchbook-NVCA data and identifies similar trends—the rise of mega-rounds, drop in seed deals, drop in total number of deals, and the increase of unicorns.



The report identifies additional themes too though. Funding to AI companies topped $1B each quarter in 2017, Asian and European funding increased, and global funding hit $164 billion—its highest since 2000.

It also ranks the U.S. sectors with the most investments—1) internet, 2) healthcare, 3) mobile/telecommunications, 4) software, 5) consumer products and services. Report authors then drill down into three sub-sectors on the rise: AI, cybersecurity, and genomics. In 2017, $5 billion was invested in AI companies, $3.6 billion in cybersecurity, and $2.5 billion in genomics companies.

Lyft made the top five list of largest deals of Q4 ‘17 twice. Once for their $500 million raise led by Baillie Gifford & Co and a second time for their $1 billion raise from capitalG (formerly Google Capital).

In Q4, the most active U.S. venture capital firms were all based in California and made between 14 and 32 investments.

Four of the largest global deals were in Chinese companies (three in Beijing, one in Shanghai). One Indian company, Olacabs, also made the top six list. Thanks to its $1 billion deal, Lyft was the sole U.S. company to make the top global deal list. For both lists, the companies were all categorized as “later stage” companies with one exception. China’s “China Internet Plus” categorized as an “expansion stage” company, raised $4 billion and tied with another Chinese company for the top global deal of Q4.

The report indicates Q4 saw the birth of four new U.S. unicorns including—the fintech company Affirm, cyber-security specialists Duo Security, the website platform Squarespace and the heart disease diagnosing company Heartflow. Bringing the total number of new unicorns birthed in 2017 to 22.

PwC/CB Insights notes the figure is up 57 percent from 2016, but has dropped significantly since what they dub as the “unicorn craze” of 2014-2015 when 78 new unicorns hit the scene.

But other sources cite different figures—Pitchbook reported 31 U.S. unicorns reached the billion dollar mark in 2017, while and Business Insider lists 23 in its count.

The status of one unicorn isn’t up for debate though. It’s clear from all the reports that Charlotte’s AvidXChange’s $300 million June raise pushed it past the $1 billion valuation mark and into the unicorn club—a big win for Charlotte and all of North Carolina.

Stay tuned for insight from some of the North Carolina investors and entrepreneurs who participated funding and fundraising in 2017.