US Venture Capitalists Invested $48.3 Billion in 4,356 Deals in 2014

US Venture capitalists invested $48.3 billion in 4,356 deals in 2014, which represented an increase of 61% in dollars and a 4% increase in deals over the prior year, according to the MoneyTree™ Report by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters.

Sector and Industry Analysis
The Software industry was the single largest investment sector for the year, with dollars rising 77% over 2013 to $19.8 billion, which was invested into 1,799 deals, a 10% rise in volume over the prior year and the highest level since 2000.
Dollars going into Software companies accounted for 41% of total venture capital investments in 2014, the highest percentage since the inception of the MoneyTree Report in 1995.
Biotechnology investment dollars rose 29% while volume decreased 4% in 2014 to $6.0 billion going into 470 deals, placing it as the second largest investment sector for the year in terms of dollars invested.
The Media and Entertainment sector accounted for the second largest number of deals in 2014 at 481, the third largest sector in terms of dollars invested with an annual total of $5.7 billion.
Overall, investments in 2014 in the Life Sciences sector (Biotechnology and Medical Devices combined) rose to the highest level since 2008 with $8.6 billion invested into 789 deals, a 29% increase in dollars but a 3% drop in deals compared 2013. Internet-specific companies experienced a 68% increase in dollars but a 6% drop in deals for the full year 2014 with $11.9 billion going into 1,005 rounds compared to 2013 when $7.1 billion went into 1,074 deals.

Stage of Development
Expansion Stage investments received the most investment dollars in 2014, increasing 102% to $19.8 billion which flowed into 1,156 deals, a 13% increase compared to the prior year. The average Expansion Stage deal was $17.1m compared to $9.6m in 2013.
Investments in Early Stage companies accounted for the most deals during 2014 with 2,165 deals capturing $15.8 billion. The average deal was $7.3 million, up from $4.8 million in 2013.
Seed Stage investments fell 29% in terms of dollars and 18% in deals with $719 million going into 192 companies in 2014, The average Seed Stage round was $3.7 million, down from $4.3 million in 2013.
In 2014, $12.0 billion was invested into 843 Later Stage deals, a 35% increase in dollars and a 6% increase in deals for the year. The average size of a Later Stage deal rose from $11.2 million in 2013 to $14.3 million in 2014.

First-Time Financings
First-time financings in 2014 rose 47% in dollars while the number of deals was flat compared to 2013, with $7.4 billion going into 1,409 companies. Industries that captured the highest total of first-time dollars and deals in 2014 were Software, Media and Entertainment and Biotechnology. 68% of first-time deals in 2014 were in the Early Stage of development, followed by the Expansion Stage of development at 14%, Seed Stage companies at 11% and Later Stage companies at 7%.



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