THE 2016 GLOBAL TECH EXITS REPORTA comprehensive, data-driven look at global tech exits, including M&A, IPO trends, and much more
The technology market intelligence platform.
CB Insights software lets you predict, discuss, and
communicate emerging technology trends using data in ways that are beyond human cognition.
www.cbinsights.com 2
www.cbinsights.com 3See what other customers have to say at http://www.cbinsights.com/customer-love
A FEW OF OUR HAPPY CUSTOMERS
The most publicly reference-able customers of anyone in the industry
Pat Grady
Sequoia Capital, Partner
“Think of the fundamental value chain of venture capital … If we play the clock forward, the finding and assessing of investments will be almost entirely done by technology, not human beings. And the company that is today positioned to be the market leader in that evolution is CB Insights."
www.cbinsights.com 4
From the NY Times to Bloomberg, CB Insights data is used by hundreds of
leading media outlets every week
“ACCORDING TO CB INSIGHTS…”
CB INSIGHTS NEWS MENTIONS PER YEAR
62 9 16
211
490
1200
2200
2010 2011 2012 2013 2014 2015 2016
www.cbinsights.com 5
TABLE OF CONTENTS
# SECTION
6 Summary
7 Global Trends
14 Geographic Recaps
19 VC-Backed Trends
30 League Tables
SUMMARY OF FINDINGS
www.cbinsights.com 6
TOTAL TECH EXITS DROPPED IN 2016, BUT IPOs UP: Globally, there were 3260 M&A exits and 98 IPOs in 2016. Total tech exits saw a 4% decline over 2015, which saw 3421 M&A exits and 90 IPOs. Overall, exit activity was up in the second half of 2016 with 1726 exits compared to 1632 exits in the first half of 2016.
US IPO ACTIVITY UP IN THE SECOND HALF OF 2016: In 2016, there were 1650+ M&A exits and 25 IPOs in the US. IPO activity increased in the second half of 2016 with 17 US tech IPOs compared to the first half of 2016 which saw 8 tech IPOs. Conversely, M&A activity saw a drop in the second half of 2016 with 793 M&A tech deals in the US compared to 862 in the year’s first half.
SV ANGEL LEADS ALL VCs IN TECH EXITS: In 2016, SV Angel led all venture capital firms in the number of exits. SV Angel backed tech companies like Cruise Automation, Twilio, and Vurb. Other VCs in the top 5 include 500 Startups, Andreessen Horowitz, and Norwest Venture Partners.
GOOGLE WAS THE MOST ACTIVE ACQUIRER IN 2016: Google made several tech acquisitions in 2016 including Eyefluence and API.AI, among several others. Salesforce and Accenture tied for the number 2 spot followed by J2 Global, which bought companies including Offers.com and Web24.
UNICORN BIRTHS DECLINE, UNICORN EXITS INCREASE IN 2016: There were 18 $1B+ tech exits in 2016 including The Dollar Shave Club, Cruise Automation, and Jet, among several others. That’s up over 2015 which saw just 12 tech exits of $1B+. However, unicorn births have significantly declined in 2016 with just 25 companies gaining $1B+ valuations, a 68% decline year-over-year compared to 2015.
IPOs OF VC-BACKED COMPANIES TRENDING HIGHER: Among the subset of VC-backed IPOs, H2’16 (22) also saw an increase over H1’16 (13) with startups like Nutanix, Coupa Software, and Quantenna Communications going public. In total, there were 62global technology IPOs in the second half of 2016 compared to 36 IPOs in the first half of 2016.
INTEL CAPITAL MOST ACTIVE CORPORATE AGAIN IN 2016: Intel Capital saw the most tech exits among all corporates and corporate venture investors. The investor saw exits in iControl Networks, Impinj, and Nexmo, among others. The second and third spots were rounded out by GV (Google Ventures) and Salesforce Ventures.
REPORT ONLY INCLUDES FIRST EXITS: This report only includes companies that have exited for the first time. PayPal, for example, is not included, despite a second IPO in July 2015 within the time frame of this report. For questions regarding this methodology, reach out to [email protected].
www.cbinsights.com 7
Global Tech Exits: MACRO TRENDS
GLOBAL TECH EXITS TICK
DOWN IN 2016, BUT IPO ACTIVITY TRENDING UP
There were 3350+ tech
exits in 2016, a 4% decline over 2015. After a slow start to the year, the
second half of 2016 saw more than 60 IPOs including companies like
Nutanix and The Trade Desk going public. This compares to just 36 IPOs
in the beginning of the year.
www.cbinsights.com 8
QUARTERLY GLOBAL TECH EXITS2014 – 2016
645 694 680 731 886 987 818 730 778 818 836 828
25
4319
27
13
36
16
2514
2230 32
2014 2015 2016
M&A IPO
ONLY 4% OF TECH EXITS
ARE UNICORN EXITS
Based on disclosed
valuations, 4% of companies exiting in 2016 did so for $1B+
including e-commerce site Jet.com, razor brand Dollar Shave Club, and
travel tech company Skyscanner.
www.cbinsights.com 9
GLOBAL TECH EXIT VALUATIONS2016
54%
13%
13%
7%
4%
1%
2%
1%
1%
1%
1%
4%
<$50
$50 - $100
$100 - $200
$200 - $300
$300 - $400
$400 - $500
$500 - $600
$600 - $700
$700 - $800
$800 - $900
$900 - $1000
$1000+
Exit Valuation ($M)
MOST EXITED TECH
COMPANIES DON’T RAISE VC, PE, OR GROWTH EQUITY
More than two-thirds of
companies didn’t raise VC, PE, or growth equity financing prior to exit in
2016. This number has decreased over 2015 where 75% of exited tech
companies did not raise VC, private equity, or growth equity.
www.cbinsights.com 10
FUNDING STATUS OF TECH COMPANIES AT TIME OF EXIT2016
32%
68%
Raised Prior Funding
No Funding
US LEADS, WITH UK, INDIA,
CANADA, AND GERMANY ALSO IN THE TOP 5
The United States took
the number one spot with more than 1600 tech exits in 2016.
European markets like the UK, Germany, France, Sweden, and the
Netherlands were among the countries in the top 10.
www.cbinsights.com 11
COUNTRY RANK BY NUMBER OF EXITS2016
RANK COUNTRY RANK COUNTRY RANK COUNTRY
1 United States 15 Singapore 28 Malta
2 United Kingdom 15 Brazil 30 Indonesia
3 India 17 Ireland 30 Nigeria
4 Canada 18 Japan 30 Russian Federation
5 Germany 19 Norway 30 Hong Kong
6 France 20 Switzerland 34 Thailand
7 Australia 20 Finland 34 Taiwan
8 Sweden 22 Belgium 34 Czech Republic
9 Netherlands 23 South Africa 37 Vietnam
10 Israel 23 Poland 38 United Arab Emirates
11 China 25 Romania 38 Philippines
12 Spain 26 Malaysia 38 Portugal
13 Italy 26 New Zealand 38 Estonia
14 Denmark 28 Austria
COUNTRY RANK BY NUMBER OF TECH EXITS2016
MOBILE ACCOUNTED FOR
~20% OF EXITS IN US, INDIA, & CANADA
Every country except
Canada saw internet exits account for 55%+ of exits in 2016. The mobile
sector in India accounted for 27% of exits in 2016, the largest percentage
within mobile across all 5 countries.
www.cbinsights.com 12
SECTOR SHARE OF TECH EXITS BY TOP 5 COUNTRIES2016
55%
55%
61%
49%
60%
17%
13%
27%
19%
14%
11%
11%
5%
12%
9%
11%
15%
5%
13%
10%
5%
5%
1%
6%
7%
1%
1%
1%
1%
United States
United Kingdom
India
Canada
Germany
Internet Mobile & Telecommunications
Software (non-internet/mobile) Computer Hardware & Services
Electronics Consumer Products & Services
MOBILE AND COMPUTER
HARDWARE UP, INTERNET EXITS DOWN IN Q4’16
The mobile and
computer hardware sectors reached 5-quarter highs in exit
share, accounting for 19% and 15% of tech exits, respectively.
Conversely, internet exits fell to 46% — a 5-quarter low.
www.cbinsights.com 13
SHARE OF TECH EXITS BY SECTORQ4’15 – Q4’16
57% 58% 59% 54% 46%
18% 15% 15%
16%
19%
13%8%
11%12%
13%
8%13% 8% 11%
15%
3% 5% 5% 5% 6%
1% 1% 1% 2% 1%
Q4'15 Q1'16 Q2'16 Q3'16 Q4'16
Internet Mobile & TelecommunicationsSoftware (non-internet/mobile) Computer Hardware & ServicesElectronics Consumer Products & Services
www.cbinsights.com 14
Geographic Recaps: INTERNATIONAL TRENDS
EUROPEAN EXIT ACTIVITY
UP IN SECOND HALF OF 2016
Q3’16 saw 284 M&A exits
and 9 IPOs, a 5-quarter high for European exits.
There were 28 European IPOs in 2016.
www.cbinsights.com 15
QUARTERLY TECH EXIT VOLUME: EUROPEQ4’15 – Q4’16
185 191 217 284 257
64
5
9
10
Q4'15 Q1'16 Q2'16 Q3'16 Q4'16
M&A IPO
ASIA SEES IPO NUMBERS
STEADILY INCREASE
Exit activity in Asia
reached 103 exits in Q3’16 but dropped 7% in Q4’16 to 96 exits.
The region saw 12 tech
IPOs in Q4’16, more than in the previous two quarters combined.
www.cbinsights.com 16
QUARTERLY TECH EXIT VOLUME: ASIAQ4’15 – Q4’16
82 84 94 97 84
44
56
12
Q4'15 Q1'16 Q2'16 Q3'16 Q4'16
M&A IPO
US IPOS UP, M&A EXIT
ACTIVITY DROPS IN SECOND HALF OF 2016
While US IPOs recovered
in the second half of 2016, M&A exits dropped significantly with Q3’16
M&A activity falling below 400 exits for the first time in the 5-quarter
trend.
www.cbinsights.com 17
QUARTERLY TECH EXIT VOLUME: USAQ4’15 - Q4’16
401 433 429 390 403
12
2 6
11
6
Q4'15 Q1'16 Q2'16 Q3'16 Q4'16
M&A IPO
CALIFORNIA LEADS, NY
FOLLOWS IN EXITS
California and New York
led US state-level exit activity in 2016. The third spot was tied by
Massachusetts and Texas which both realized more than 90
tech exits in 2016.
www.cbinsights.com 18
US STATE RANK BY NUMBER OF TECH EXITS2016
RANK STATE RANK STATE RANK STATE
1 California 13 Utah 29 South Carolina
2 New York 16 Tennessee 30 DC
3 Massachusetts 16 Arizona 31 Oklahoma
3 Texas 16 New Jersey 31 Nebraska
5 Illinois 19 Minnesota 33 Vermont
6 Florida 20 Michigan 33 Alabama
7 Pennsylvania 21 Missouri 33 Idaho
8 Virginia 22 Oregon 36 Kentucky
9 Washington 23 Nevada 37 Rhode Island
10 Georgia 24 Connecticut 37 New Mexico
11 Colorado 24 New Hampshire 37 Iowa
12 North Carolina 24 Indiana 37 Delaware
13 Maryland 27 Kansas 41 South Dakota
13 Ohio 27 Wisconsin 41 Mississippi
US STATE RANK BY NUMBER OF TECH EXITS2016
www.cbinsights.com 20
State Of VC-Backed Exits: M&A AND IPO TRENDS
VC-BACKED ACTIVITY
SPIKES IN SEPTEMBER, DROPS THROUGH DECEMBER
September saw 63 VC-
backed M&A deals and 9 tech IPOs, a 12-month high in exit activity.
11 out of 12 months in
2016 saw a VC-backed tech IPO.
www.cbinsights.com 21
MONTHLY GLOBAL VC-BACKED TECH EXIT TRENDS 2016
52 66 53 61 41 61 59 64 63 60 59 52
1
1
2
2
3
44
9 32
4
January February March April May June July August September October November December
M&A IPO
VC-BACKED EXIT
ACTIVITY INCREASES IN 2016
In 2016, there were 726
(691 M&A, 35 IPOs) venture-backed exits, a 9% increase over 2015
exit activity.
Venture-backed IPO activity improved in the second half of 2016 with
22 IPOs, compared to 13 in the first half of the year.
www.cbinsights.com 22
QUARTERLY VC-BACKED TECH EXIT TRENDS Q1’14 – Q4’16
151 150 170 142 171 168 143 150 171 163 186 171
14 258
17
514
4 13
49
13
9
2014 2015 2016
M&A IPO
44% OF TECH STARTUPS
EXIT IN THE EARLY-STAGE
In 2016, 25% of venture-
backed exits were seed-stage startups, and 19% were Series A-stage
startups.
23% of venture-backed exits were of mid-stage (Series B and Series C)
startups.
www.cbinsights.com 23
LAST ROUND RAISED BEFORE EXIT BY VC-BACKED TECH
COMPANIES2016
25%
19%
15%
8%
5%
4%
4%
3%1%
2%
13%Seed / Angel
Series A
Series B
Series C
Series D
Series E+
Debt
Growth Equity
Private Equity
Convertible Note
Other
LESS THAN 10% OF
COMPANIES RAISED $100M+ BEFORE EXIT
There were 50
companies that raised $100M or more before exiting in 2016 including
breakout companies such as Twilio, Lytx, and Ping Identity.
www.cbinsights.com 24
AMOUNT RAISED BY VC-BACKED TECH COMPANIES BEFORE
EXIT2016
58%
14%
6%
5%
4%
2%
2%
1%
1%
1%
7%
<$10
$10 - $20
$20 - $30
$30 - $40
$40 - $50
$50 -$60
$60 - $70
$70 - $80
$80 - $90
$90 - $100
$100+
Total Amount Raised ($M)
INTERNET AND MOBILE
DOMINATE, ELECTRONICS ON THE RISE
In Q4’16, the internet
sector accounted for 54% of tech exits while mobile accounted for
22% of tech exits.
Electronics exits ended the period with 5% of the total in Q4’16.
www.cbinsights.com 25
SHARE OF VC-BACKED TECH EXITS BY SECTORQ4’15 – Q4’16
56% 63% 61% 64% 54%
23%
19%26%
18%
22%
13% 9%7%
11%11%
5% 5% 4% 4%4%
2% 3% 2% 4%5%
1% 1% 1% 3%
Q4'15 Q1'16 Q2'16 Q3'16 Q4'16
Internet Mobile & TelecommunicationsSoftware (non-internet/mobile) Computer Hardware & ServicesElectronics Consumer Products & Services
AD, SALES & MARKETING
LEADS EXIT ACTIVITY IN 2016
In 2016, there were 54
venture-backed advertising, sales, & marketing exits. Among
them were marketing tech companies AppLovin and Circulate,
exiting for $1.4B and $140M, respectively.
www.cbinsights.com 26
TOP SUB-INDUSTRIES OF VC-BACKED TECH EXITS2016
54
36
29
27
22
21
20
18
18
15
15
15
13
13
12
12
11
Advertising, Sales & Marketing
Business Intelligence, Analytics &…
Marketplace
Customer Relationship Management
Healthcare
Monitoring & Security
Social
Apparel & Accessories
Gaming
News & Discussion
Education & Training
Payments
Collaboration & Project Management
HR & Workforce Management
Travel (internet)
Health & Wellness
Video
UNICORN BIRTHS DOWN,
BILLION DOLLAR EXITS UP IN 2016
After drawing even in
Q3’16, unicorn births surpassed the number of $1B+ tech exits in Q4’16.
There were 18 tech exits
of $1B or more in 2016 including Cruise Automation, Jet, Dollar
Shave Club, Skyscanner, and many more.
www.cbinsights.com 27
NEW VC-BACKED TECH UNICORNS VS VC-BACKED TECH
EXITSQ1’15 – Q4’16
1
6
0
5
2
5
8
3
15
2524
13
6
4
7
Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16
$1B+ Exits New Unicorns
THE TOP 10 VC-BACKED
EXITS IN 2016 WERE VALUED AT $1.4B+
3 out of the top 5
venture-backed exits were of companies based outside the US,
including China-based Ucar Group and Meitu, as well as UK-based
Skyscanner.
The top 5 venture-backed companies all exited at or above a $1.7B
valuation.
www.cbinsights.com 28
TOP 10 VC-BACKED TECH EXITS2016
$5.5 billionIPO
$4.9 billionIPO
$3.3 billionAcquisition (Walmart)
$2.2 billion
IPO
THIS SLIDE HAS BEEN UPDATED
See ‘Top Exits’ tab in excel for updated raw data
$1.7 billion
Acquisition (Ctrip.com)
THE TOP 10 VC-BACKED
EXITS IN 2016 WERE VALUED AT $1.4B+
The last 5 companies
here span marketing, e-commerce, ad tech, and digital health.
www.cbinsights.com 29
TOP 10 VC-BACKED TECH EXITS2016
Corporate Majority (Alibaba Group)
$1.5 billion
$1.4 billion
Corporate Majority (SES)
$1.5 billion
Corporate Majority (Dentsu Aegis Network)
$1.7 billion
IPO
Acq-Fin (Orient Hongtai Shihe Investment Management)
$1.4 billion
THE TOP 20 VC-BACKED
TECH EXITS
7 of the top 20 exits were
IPOs including Nutanix, NantHealth, Twilio, and The Trade Desk, among
others.
All of the top 20 venture-backed exits were $900M or more in exit
value.
www.cbinsights.com 30
TOP 20 VC-BACKED TECH EXITS2016
RANK COMPANY VALUATION ($B) EXIT TYPE RANK COMPANY VALUATION ($B) EXIT TYPE
1 Ucar Group $5.5 IPO 11 Jasper Technologies $1.4 M&A
2 Meitu $4.9 IPO 11 SquareTrade $1.4 M&A
3 Jet.com $3.3 M&A 13 Twilio $1.2 IPO
4 Nutanix $2.2 IPO 14 Sitecore $1.1 M&A
5 Skyscanner $1.7 M&A 15 Takeaway.com $1.1 IPO
6 NantHealth $1.7 IPO 16 Dollar Shave Club $1.0 M&A
7 Lazada $1.5 M&A 16 The Trade Desk $1.0 IPO
7 Merkle $1.5 M&A 16 Cruise Automation $1.0 M&A
9 O3B Networks $1.4 M&A 19 Heptagon Micro Optics $0.9 M&A
10 AppLovin $1.4 M&A 20 ServiceMax $0.9 M&A
TOP 20 VC-BACKED TECH EXITS2016
www.cbinsights.com 32
2016 M&A and IPO League Tables
SV ANGEL AND INTEL
CAPITAL LEAD THE WAY
SV Angel and Intel
Capital round out the first and second spots for most tech exits in 2016.
500 startups took the third spot and was an investor in companies
like Twilio which went public in 2016 at a $1.2B valuation.
www.cbinsights.com 33
TOP VC INVESTORS IN EXITED TECH COMPANIES2016
RANK INVESTOR RANK INVESTOR
1 SV Angel 13 Salesforce Ventures
2 Intel Capital 13 Bessemer Venture Partners
3 500 Startups 15 Qualcomm Ventures
4 Norwest Venture Partners 15 New Enterprise Associates
4 Andreessen Horowitz 15 BoxGroup
6 Lerer Hippeau Ventures 18 FundersClub
7 General Catalyst Partners 18 Kleiner Perkins Caufield & Byers
7 Accel Partners 18 Index Ventures
7 Draper Fisher Jurvetson 21 First Round Capital
10 Sequoia Capital 21 CrunchFund
10 Slow Ventures 21 Battery Ventures
10 Google Ventures
TOP VC INVESTORS IN EXITED TECH COMPANIES
INTEL AND GV CONTINUE
TO KEEP IT CLOSE IN 2016
Intel continues its prolific
run as a CVC investor realizing the most exits among corporates and
CVCs in 2016. GV and Salesforce Ventures took the next two spots in
realized exits in 2016.
www.cbinsights.com 34
TOP CVC AND CORPORATE INVESTORS IN EXITED TECH
COMPANIES2016
RANK INVESTOR RANK INVESTOR
1 Intel Capital 14 Samsung Ventures
2 Google Ventures 14 Motorola Solutions Venture Capital
3 Salesforce Ventures 14 Digital Garage
4 Qualcomm Ventures 14 WME/IMG
5 Tencent Holdings 18 SingTel Innov8
6 In-Q-Tel 18 Robert Bosch Venture Capital
7 Nokia Growth Partners 18 Citi Ventures
8 Comcast Ventures 18 Tengelmann Ventures
9 Time Warner Investments 18 DG Incubation
9 GE Ventures 18 Deutsche Telekom Strategic Investments
9 Cisco Investments 18 DeNA
9 Bertelsmann Digital Media Investments 18 Naspers
9 Liberty Global Ventures 18 Unilever Ventures
TOP CVC & CORPORATE INVESTORS IN EXITED TECH COMPANIES
GOOGLE WAS THE MOST
ACTIVE ACQUIRER IN 2016
Google was the most
acquisitive company in 2016 buying companies like EyeFluence and
API.AI. The second spot was tied between Salesforce and
Accenture followed by J2 Global in the fourth spot.
www.cbinsights.com 35
TOP TECH ACQUIRERS2016
Rank Acquirer Select Acquisitions
1
2
2
4
@ cbinsights
+1(212)292-3148
CBINSIGHTS.COM