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Cooley Report Reviews Fourth Quarter and 2010 Venture Capital Financing Trends


March 29, 2011 - Palo Alto, CA

Cooley LLP today released its most recent report on venture capital financing trends. The report analyzes Cooley's venture capital transactions nationwide that closed during the fourth quarter of 2010, with comparisons to the first three quarters of 2010 as well as prior years.

Highlights from 2010 include:

  • Overall deal volume in 2010 reached 407 deals, a level not seen over the last five years.
  • All series of financings saw an increase in median pre-money valuations over the prior year. This was especially pronounced in later-stage deals. There was a sizable increase in the number and percentage of deals with a median pre-money valuation of more than $100 million.
  • The percentage of up rounds increased over 2009, with a significant increase in the fourth quarter. Seventy-two percent of all fourth quarter financings were up rounds.
  • There was a decrease in deals with pay-to-play provisions to just ten percent, a level not seen since 2007.

"The slow but steady growth we saw in 2010, and the continued growth thus far in 2011, leads us to be optimistic about financing trends continuing to improve," said Craig Jacoby, head of Cooley's Emerging Companies practice.

Cooley's Private Company Financings Report is published quarterly and is based on private company transactions in which Cooley served as counsel to either the issuing company or the investors. The analysis in this report is based on 407 deals completed in 2010 across the United States, totaling approximately $4.6 billion. A complete version of the report is available here: www.cooley.com/venture-financing-report-q4-2010.

About Cooley LLP

Cooley's 650 attorneys have an entrepreneurial spirit and deep, substantive experience, and are committed to solving clients' most challenging legal matters. From small companies with big ideas to international enterprises with diverse legal needs, Cooley has the breadth of legal resources to enable companies of all sizes to seize opportunities in today's global marketplace. The Firm represents clients across a broad array of dynamic industry sectors, including technology, life sciences, venture capital, clean energy, real estate and retail.

The Firm has full-service offices in major business and technology centers nationwide: Palo Alto, CA, New York, NY, San Diego, CA, San Francisco, CA, Reston, VA, Broomfield, CO, Washington, DC, Boston, MA and Seattle, WA.

Ashley Kanigher
Email Contact
415-693-2003

MarketWire

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