VCs in Q4: nearly $14 billion invested in 814 deals

2014 is looking better and better for the venture capital space

We've already seen the evidence that 2014 was the best year for the venture capital space in a long time. But now it's looking like it might be even better than we thought.

Venture capital funds raised a total of nearly $33 billion, across 332 funds in 2014, according to a new report from Dow Jones VentureSource on Thursday. That would be an increase of 62% from the total amount raised in 2013, and a 27% increase the in number of funds.

Those numbers are even higher than the totals released by Thomson Reuters and the National Venture Capital Association (NVCA) earlier this week, which saw a total of $29.8 billion raised from 254 funds last year.

According to DowJones, a total of 85 funds raised $8.1 billion in the fourth quarter of last year, a 25% increase in the amount raised, and a 4% rise in number of funds, quarter-to-quarter. Again, these numbers trumped those from the NVCA, which recorded 75 funds and $5.6 billion.

When it came to the largest U.S. venture capital fund of the fourth quarter, Tiger Global Management led the pack by raising $2.5 billion and accounting for 31% of the total amount raised during the quarter.

Canaan Partners was a distant second, with $675 million raised, followed by Formation8 Partners with $500 million, Polaris Partners with $465 million and Vivo Capital with $427.65 million.

The report also looked at how much money was invested in 2014, with $52 billion going into 3,682 deals, a 4% decrease in the number of deals, but a 47% increase in the amount invested. Once again, DowJones has higher numbers than other sources; a CB Insights report cited $47.3 billion invested across 3,617 deals in 2014.

The DowJones report also report that, in the fourth quarter of 2014, there was $13.8 billion invested in 814 deals, a 20% decrease in the number of deals, but a 44% increase in the amount invested.

The sector that saw the largest number of deals was Consumer Services, with 159 deals and almost $3.8 billion invested. That accounted for 27% of total equity investment during the quarter.

Information Technology, meanwhile, raised $3.3 billion, up 52% year-to-year, across 245 deals, up 13%. Business and Financial Services saw $3.2 billion, a 4% increase, in 206 deals, a 23% drop from the same quarter in 2013.

The healthcare sector was also strong, raising $2.5 billion in 143 deals. (Which innovations are disrupting healthcare? Find out when Vator hosts Splash Health on Feb. 12 at Kaiser Center in Oakland. Get your tickets now!)

Looking at the full year of 2014, Business and Financial Services accounted for 26% share of investment with $13.7 billion; IT saw 24% with $12.3 billion; Consumer Services accounted for 23%, with $11.9 billion; and Healthcare was 21%, with $11 billion.

Mergers and acquisitions (M&As), they by 60% quarter-to-quarter, with 102 deals totaling $32 billion.

For the full year, 483 M&As were completed, and increase of 8% from the 449 completed during 2013 and 2% from the 473 seen during 2012. 

Initial public offering (IPO) activity increased by 134% in the fourth quarter, raising $3 billion from 21 companies. The largest IPO of the quarter was LendingClub, which completed an $870 million IPO.

2014 saw the highest number of US VC-backed IPOs since 2000, when 210 were completed. During 2014,105 companies garnered a total of $9.2 billion, an increase of 42% and 12% respectively.

(Image source: hnwmagazine.co)