Venture terms more bubbly than ever
The investment climate for the latest consumer Internet companies, dubbed “Web 2.0″ companies, remains bubbly, according to the latest survey by Silicon Valley law firm Fenwick & West.
Venture capitalists paid on average 69 percent more for their ownership of stock in companies receiving venture capital in the fourth quarter of last year, compared to the companies’ previous financing round.
This was the largest increase since the survey began. (See full results here.) The increase was driven mainly by nine financings during the quarter in which the stock price in the financing was at least three times higher than the prior round. Of these nine financings, most were “Web 2.0 and related fields,” the law firm found.
The survey analyzed the financing terms of 113 venture companies headquartered in the San Francisco Bay Area that raised money during the quarter. The survey lists other financing information, such as the prevalence of liquidation preferences, percentages of up rounds, and IPO and M&A activity.
[Disclosure: Fenwick & West is a sponsor of VentureBeat]
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About the Author, Matt Marshall
Matt launched VentureBeat in September of 2006, with the realization that no one else was covering the entrepreneurial and tech innovation scene with the velocity or depth that he was. Prior to founding VentureBeat, he covered venture capital for the San Jose Mercury News from 2001 to 2006. In 2002, Matt was awarded "Journalist of the Year" by the Northern California Society of Professional Journalists. Prior to working at the Merc, he was a correspondent for the Wall Street Journal in Bonn, Germany from 1995 to 1998, and a writer for the Washington Post in 1994. Matt holds a PhD in Government and an MA in German and European Studies from Georgetown University. In addition to VentureBeat, Matt is also the Executive Producer of DEMO, the leading launchpad event for emerging technologies.
