Global exits grow 28% year over year in Q3, but dip from Q2

There was not a single unicorn exit during the quarter, as 54 percent exited for less than $50M

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The amount of money being poured into companies all around the world is up this year, having already surpassed 2014's totals, but how is it looking from the other end, meaning companies that are exiting?

Perhaps not surprisingly, those numbers are up this year as well, according to the Q3 2015 Tech Exits Report from CB Insights, released on Monday. In fact, every quarter so far this year has seen at least 800 exits, while not one single other quarter had seen that many over the prior four years.

Overall tech exits declined 18 percent compared to the second quarter of 2015, dipping to 824 M&A deals and 9 IPO exits. However they were up 28 percent year year-over-year, and Q3’15 had the third-highest number of exits since the first quarter of 2011.

The quarter also saw a continuation of the unicorn drought, meaning a lack of billion dollar companies either having their IPOs or being acquired. It's a trend that we've been seeing for the entire year, and in this latest quarter there was not a single $1 billion exits. Not one. There weren’t any companies that exited for over $700M either, and only 5 exits greater than $500 million. In fact, the majority, 54 percent, exited for less than $50 million.

The United States had the most exits worldwide, and California was the state with the most, by far, with more exits than the next three states in the ranking, New York, Texas,and Massachusetts, combined. Those four states, along with Florida, each saw more than 20 tech exits in the quarter.   

Outside of the U.S., it was The United Kingdom leading all countries in exit activity during the quarter, Other countries that ranked high for exit activity in Q3’15 were India, Canada, Germany, and the 
Netherlands. 

During the third quarter, 82 percent of tech companies didn’t raise any institutional capital prior to exit. In the full-year 2014, that number was 73 percent of exited global tech companies.

Of those companies that were VC-backed, things were not looking so great. With 145 exits, including only 4 IPOs, a 19 percent quarter to quarter decline, VC-backed tech exits had their worst quarter since the second quarter of 2013. 

Again, despite big rounds and valuations, most exits were still early. 55 percent occurred after Seed or Series A investment, and  25 percent after a Series B or C. Only 13% of exits occurred after a Series D round or later. 

Of those companies that had raised funding, 59 percent had raised less than 10 million, and only three companies that had raised $100 million or more exited during the quarter.

Among top five biggest exits of the quarter were the IPOs of Teledoc, which raised $680 million, and Rapid7, which raised $605 million.

There were three acquisitions as well. They were Infor's acqusiition of GT Nexus for $675 million; Advance/Newhouse acquiring1010data for $500 million; and Axel Springer purchasing a majority stake in Business Insider for $442 million.

There were a total of 10 VC-backed exits that ranged between $100 million and $200 million during the third quarter of 2015.

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