What follows is every chart and the like from our US-Canada report. Notably, this is our first run of putting out a combined look at the United States and Canadian venture scenes. Our own Joanna Glasner took point on the idea and its execution.

As always, the goal of putting out just the charts from 0ur longer reports is to provide you with a quicker way to slice through quite a number of data points. You are welcome if it helps. If it doesn’t, we apologize.

As a general note, if you have comments on how we did this cycle of reports, email us. We’re more than up for feedback.

And if you still need more charts and data and numbers and venture capital takes, the following banner will take be your satiation:

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Thus it was last week, with all our quarterly work taking on an annual edge. However, you might have been a bit busy last week, so we are bringing you the gut and sinew of our admittedly-long global venture capital work in a simple format.

To that end, the following is every chart from the global VC report, inclusive of some notes and easily our best Slideshare formatting to date.

So if you want to know what is going on around the world in the realm of venture, get clicking.

We’ll have a US-Canada-centric version of this post coming out in just a minute, so hang tight if that is more your jam.

For more Q4 and 2017 coverage, the following banner will take you to everything that we wrote:

With recreational cannabis use being legalized in eight states, those who have bought cannabis illegally in the past and those left out because of illegality may be brought into the fold of a nascent (legal) industry.

And according to The Economist, California has the largest market for recreational cannabis and a study by the Agricultural Issues Center at UC Davis predicts that “sales from recreational cannabis will eventually reach [$5 billion] a year.”

However, legalization doesn’t just mean flowers and happiness for cannabis businesses. As industry players prepared for recreational legalization in their largest market, they also anticipated political and regulatory challenges. With that in mind, let’s take a look at how the fourth quarter shaped up for the cannabis industry in terms of startup activity right before weed went legal.

Inside The Numbers

Over the past six years the U.S. cannabis startups funding amounts have been tumultuous.

Cannabis startups saw their venture capital totals jump from 2013 to 2014, when dollars raised by companies in the space shot from $9.7 million to $186.7 million.

During the same period of time, recreational cannabis use was legalized in Colorado and Washington state. Unsurprisingly, a full 25 percent of those funding rounds in 2014 were directed toward companies based in Colorado.

The California law legalizing use of recreational cannabis, though enacted on January 1, 2018, was voted into law in late 2016, and could account for the notable increase from the nearly $142 million raised in 2016 to the $225.3 million raised in 2017.

The quarterly numbers for 2017 are less conclusive. We see an increase from the first to the second quarter in both number of known funding rounds, from seven to 22, and known dollars directed into the space, from almost $10 million to about $73 million. The second and third quarters saw similar results in dollar amounts raised, with an increase in number of known funding rounds from 13 to 22. The fourth quarter saw a slight decrease from nearly $75 million in quarter three to about $68 million, as well as a slight decrease in known funding rounds from 22 to 19.

(Of course, it’s important to note that deal counts and dollars amounts may be underreported due to the myriad of legal concerns surrounding the distribution of cannabis and cannabis products.)

With new businesses and room for growth, funding rounds in 2017 consisted of mostly early-stage (Series A and B) and seed-stage ventures. Quarter four, specifically, consisted of 30.8 percent early-stage and 23.1 percent seed-stage ventures.

A Closer Look At Q4 2017

One company that dove head first into the cannabis industry is Colorado-based MJardin. The company raised $20 million in equity financing in late December. MJardin is an operational management company which provides cannabis businesses with assistance in areas ranging from cultivation processes to plant cultivation software and growing materials. It also has its own subsidiary investment arm, MJardin Capital.

Another notable investment round in Q4 was a Series A for Denver-based Baker Technologies. The round raised nearly $8 million in funding and was led by cannabis industry-focused firm Poseidon Asset Management. Baker provides a point-of-sale platform designed to help dispensaries connect with customers and manage internal business processes. Customers can set preferences, sign up for email and text alerts, and order through its online portal.

According to Forbes, Baker Technologies CEO Joel Milton stated that he had its sights set on California the “largest market in the country.” The funding round helped Baker Technologies to open an office in Los Angeles to increase its presence in California prior to legalization.

San Diego-based startup, Weedguide, also raised $1.7 million in a seed round in October. The online platform educates consumers about the process of buying cannabis and connects both medical and recreational consumers to dispensaries in their areas. Spokesperson Sarah Daily calls Weedguide the “one-stop-shop, a single destination that provides access and guidance to the entire cannabis experience.”

Investment was also directed into spaces not dealing directly with cultivation and sales. Ohio-based Cannasure Insurance Services raised an undisclosed amount of funding through a private equity round backed by Krauter and Company. It has capitalized on the stigma surrounding the cannabis industry by providing insurance packages to cultivation centers and dispensaries across the United States.

Federal Disapproval Hampers Growth

Despite a massive potential for growth with adult-use legalization, mainstream VC firms are hesitant to invest in cannabis companies. According to the Wall Street Journal, illegality at the federal level has made it difficult for many cannabis businesses to attract investment from non-industry-focused firms.

Furthermore, some venture firms have been reluctant to invest in light of Attorney General Jeff Sessions’s attack on state legalization of adult use. On the bright side, this struggle has given way to the creation of industry-specific investment firms like MJardin Capital and Poseidon Asset Management, which are eager to invest in the growing cannabis industry.

As far as a potential federal crackdown is concerned, Weedguide representative, Sarah Dailey, told Crunchbase News that she believes “one of the most harmful things right now to come out of Sessions rescinding the Cole memo is just the overall uncertainty that has descended on the industry.”

But she is happy with the overall response from state attorneys who she says are “vowing to fight against what certainly seems to many like federal overreach.”

CEO Joel Milton also expressed confidence to Crunchbase News. “We have to wait and see until Sessions makes his announcement, but we remain optimistic about the state of the industry,” Milton explained.

Like Dailey, Milton is also confident that states will stick by their constituents’ decisions in the face of federal backlash. Benefits of recreational legalization like job creation and tax revenue are major incentives for resistance by state governments.

Some dispensaries and medical users in California are frustrated with the high tax on cannabis and rises in prices brought on by expenses for licenses and compliance. Some fear that tax rates at this level will cause businesses to lose potential buyers to illegal vendors.

But Milton told Crunchbase News that he is optimistic about the tax situation. “Legalization provides the consumer transparency of pricing,” Milton explained.

As more states join the wave of recreational legalization, the cultural stigmas surrounding its use will likely begin to change. One can speculate that U.S. citizens will be less tolerant of federal backlash resulting in more funds from mainstream VCs being directed into emerging companies in the industry.

Deal flow in the Lone Star State saw a marked slowdown in the final quarter of 2017 compared to preceding fourth quarters. The number of dollars raised was disappointing as well.

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Just how slow are we talking about? The number of Texas startups funded in the fourth quarter (34) was less than half that of what was funded in the fourth quarter of 2015 (71), according to Crunchbase data. And the $412 million raised was the lowest Q4 total from the last three years, clocking in 36 percent down from the $644 million raised in 2016’s final quarter.

(Please note that for our Texas coverage we use reported data, not projections similar to what you can find in our US-Canada and Global reports. This means that reporting lag—from funding event to public knowledge—has a higher impact than in our more geographically broad quarterly reports.)

Compared to the state’s dismal performance in the third quarter, things didn’t look so bad according to our research. The number of deals was down (34 vs. 43) but dollars raised were up 55 percent – $412 million compared to the $186 million that Texas startups brought in during the third quarter of 2017. But that was an unusually weak quarter.

On an annual basis, Texas companies raised $1.26 billion in 2017. That’s 30 percent lower than the $1.79 billion raised in 2016. While the year saw an impressive second quarter, the rest of 2017’s performance was down.

Some of the year’s more notable deals include auto insurance marketplace The Zebra’s $40 million Series B round, AI-driven cognitive analytics company SparkCognition’s $32.5 million Series B raise and real estate startup Opcity’s $27 million haul in a Series A round.

The state also saw a few notable exits this year, including Harland Clarke Holding Corp.’s acquisition of Austin-based coupons site RetailMeNot for $630 million.

Looking ahead to 2018, area venture capitalists and observers believe the region will follow the nation’s lead and see strong activity in the areas of artificial intelligence, machine learning and blockchain technologies. But for now, let’s take a deeper dive at what went on in 2017.

Market Breakdowns

As usual, Austin ­– the state’s capital – led Texas both in terms of deals funded and dollars raised both in the fourth quarter and in 2017 as a whole, according to Crunchbase data. Funding in Dallas and Houston was down significantly for the year with both cities notching their weakest annual performance since 2013.

Fifteen Austin startups raised 44 percent more – or $196 million ­– in the fourth quarter than the $110.2 million raised by 20 startups in the 2017 third quarter, signaling larger deal sizes.

Dallas wasn’t far behind, having raised $169.5 million across 11 deals in the year’s final quarter. Seven Houston startups raised just $29.4 million in the fourth quarter. San Antonio had its best quarter of the year, with one startup bringing in $17 million.

Annually, the $761.3 million raised by Austin companies in 2017 was nearly flat compared to the $761.6 million raised in 2016, according to Crunchbase data.

Dallas startups raised $289.5 million in all of 2017 compared to $340.6 in the 2016 fourth quarter alone. Houston companies brought in $168.4 million during the year, way down from the $468 million they raised in 2016.

The Venture Perspective

As usual, when asked, area venture capitalists remain bullish on the region’s funding environment despite the less-than-stellar numbers.

Morgan Flager, general partner at Austin-based Silverton Partners, said his firm “didn’t break stride at all” when it came to investing in 2017. Silverton – one of Austin’s largest venture capital firms – ­announced it had raised a $100 million fund in February 2017. The company has made five investments out of that fund, Flager said.

However, he acknowledged that a lot of the investment activity in Austin and the state as a whole tended to be early-stage funding deals, which “tend to be smaller.”

“So while the number of transactions are increasing, you don’t see the needle moving that much in terms of aggregate funding in a given quarter,” he said. “There’s just not a ton of bigger, later-stage rounds going on. But for us, the early-stage funding landscape is as healthy as it’s ever been.”

Having said that, Flager dismisses any comparisons to the Bay Area.

“We’re not on pace to eclipse that region, or even on a path to do so,” he said. “But I do see steady growth and the number of funds based here are increasing.”

Of the 10-11 investments Silverton did in 2017, only two were not in Austin companies.

Chris Scheetz, managing member of Austin-based 1839 Ventures, believes “there’s some re-setting” going on with Austin venture capitalists as some firms work to raise money. One of the city’s more active investors, Live Oak Venture Partners, is reportedly in the process of raising a $110 million fund.

For its part, 1839 Ventures was founded in 2015 and is in the process of raising a $40 million fund to focus on domestic startups. It’s also raising a $20 million dedicated to helping Pakistani startups to help them expand to the U.S. or internationally.

1839 Ventures aims to fill what Scheetz describes as a gap in bigger seed, smaller Series A investments. The firm will focus on investing in Austin and Central Texas-based commerce, communication and business intelligence companies.

Overall, he doesn’t view the city as going through a funding slowdown.

“I think Austin is on target to where we need to be,” he told Crunchbase News. “I think there was a VC bubble all across the nation and now we’re down to a calmer level, not just here but everywhere.”

Even Houston-based firms are investing in Austin companies.

Despite being based in Houston, Mercury Fund’s investments tend to be outside the city. The firm put money in 47 rounds last year. Thirteen of those were in Austin companies. Thirty were in other midcontinent cities. Just four deals involved startups based in its home city.

Aziz Gilani, partner at Houston-based Mercury Fund, defends his firm’s increased activity in enterprise software and SaaS companies in Austin by pointing to the city’s “well-developed startup ecosystem.”

“Comparing the two cities is like comparing apples versus oranges,” he told Crunchbase News. “In Austin, we find increased density, which means it is easier to find talent, and an ecosystem that cultivates startups.”

Gilani added that he suffers from the curse that his first year in venture was 2008 when the recession first hit.

“So when you say slowdown, I am always measuring it against those numbers,” he said. “And right now every company I see that needs to get funded is getting funded. Activity numbers are pretty darn strong.”

During the fourth quarter, Mercury Fund participated a new round of financing for PR analytics startup Trendkite, an $11 million round led by New York-based Harmony Partners.

In general, Gilani said that Austin companies that are hitting growth targets and have achieved product market “are getting funded easily.”

Houston companies have traditionally “been a step behind” Austin in terms of maturity in the venture landscape, Gilani acknowledges. However, he praised the city’s recents efforts to advance its startup ecosystem such as the development of Houston Exponential, which was created through a combination of organizations to bolster Houston’s innovation ecosystem and drive the region to become a top 10 startup ecosystem by 2022.

Plus, Gilani notes there are now more than 400 members of Station Houston, a hybrid accelerator and co-working space aimed at boosting the city’s technology scene.

“Houston is trying to figure stuff out and trying to achieve what Austin did a few years ago,” Gilani said. “It has made great strides over the last two quarters” despite being hit hard by Hurricane Harvey.

Dallas seed-stage venture capital firm Interlock Partners started actively investing in June 2017. It’s in the process of raising what it’s targeting to be a $75 million fund but has closed four deals since inception – two in Texas companies and two in startups in New York where it has a satellite office, according to Partner Jeff Williams.

He admits that relatively speaking, the Dallas VC market is “usually pretty soft.”

But that hasn’t kept Interlock from being what Williams describes as “pretty aggressive” on the deal flow side.

“A lot of companies seem to be out looking for their Series A funding,” he said. “And, we’re pretty excited about the deal flow pipeline we’ve developed in a short period of time.”

Dayakar Puskoor, founder and managing partner of Dallas-based Naya Ventures, said his firm incubated two artificial intelligence (AI) companies in 2017 – DocSynk, a virtual intelligent assistant for healthcare, and HyperVerge, a Palo Alto-based company that develops image engines with use of high-performance vision and machine learning technologies.

In general, Puskoor said he’s seen companies “getting more mature.” He’s hoping that 2018 will include more collaboration among Dallas VCs from investors in Austin and Houston.

“We hope to invest more in Series A and B rounds, not just seed,” he said

Personal Take

As an Austin-based tech writer, I admit I’m a little disappointed in the state’s 2017 numbers.

Everyone I talk to here seems so enthusiastic about the city’s startup scene and its potential. Large tech companies such as Apple, Amazon, Google and Cisco have a significant presence here. So what is it about the city that keeps it from reaching its full potential? Some say Austin just doesn’t think “big” or “globally” enough.

I’m not sure what it is exactly. I do see the number of venture capital funds here growing. And there’s no shortage of startups or talent. But when you look at the numbers, it seems that Austin – and Texas as a whole – has a long way to go.

I think most tech-minded Texans are clear that comparisons to Silicon Valley are silly. Austin and the other major Texas markets are still working to develop their own unique startup and venture ecosystems. Hopefully in 2018, we’ll see more of those efforts come to fruition.

However, now even my fellow gym rats (a term I use endearingly) in Oregon have heard of crypto and its incredible, bubble-like ascent. After all, it is hard to keep quiet about a technology that seemingly conjures billions of dollars worth of value seemingly overnight.

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These pages have documented the crypto phenomenon, with some amused derision, a number of times. And now that 2017 has come to a close, we can take a closer look at just how much ICOs have grown over 2017, and how traditional venture capitalists are investing in startups that power crypto using the blockchain.

ICOs Boom in 2017

Although reporting indicates that ICOs have been around since 2013, the funding model was relatively nascent until last year. Essentially, an ICO is kind of like crowdfunding, except backers receive newly-created tokens. It’s a way for companies in the crypto economy to raise capital and fund development. And, arguably, the booming popularity of raising funds through an ICO have helped put crypto into the mainstream.

According to Crunchbase’s tracking of ICOs, 2017 got off to a slow start. Only seven ICOs were documented in the first quarter of the year, raising an estimated $28 million. But by the next quarter, the number of ICOs increased by nearly 4 times to 25 known ICOs, while dollars raised increased by an estimated $402 million, bringing in a total estimated sum of $680 million.¹

The pace of funding continued to raise across deal counts and amounts as 2017 marched forward. In the third quarter, ICOs broke over an estimated billion dollars raised for the first time and doubled the number of known deals. By the fourth quarter, known ICO deals and the estimated amounts raised nearly doubled again.

The end of year result? An estimated $4.9 billion was raised through ICOs in 2017, around the same amount reported by the Wall Street Journal in mid-December of last year.

A little under one billion of that amount went into two crypto-based startups, according to Crunchbase.

Taking the top spot for the year was Block.one, which raised $700 million in the fourth quarter as a result of its ICO. The company, which aims to create software “that promises to handle millions of transactions per second,” according to the Wall Street Journal, is now valued at $4.5 billion. And like many crypto startups, it has little to show from a product perspective.

Following Block.one’s massive ICO is Filecoin, which has raised an estimated $258 million. The company aims to create a distributed data storage network, and those who choose to participate in its network will earn the company’s crypto currency in exchange for computing resources. Filecoin is also notable for its buy-in from traditional VC investors such as Andreessen Horowitz, Union Square Ventures, and Winklevoss Capital.

But while ICOs appear to be an incredibly expeditious way to raise an immense out of cash, it’s not known if the wild ride will continue. An incredible number of ICOs lack well-developed teams and are almost embarrassingly short of any reasonable business plan. And regulators aren’t ignorant. The SEC has issued guidance that ICOs can, indeed, be securities—putting ICOs in the same regulatory bucket as traditional public offerings.

It’s a messy world. And it’s one that may still yet justify capital from well-established tech investors.

New Technology, Same Investors

Prior to the popularity of ICOs, the main means of raising funds for a crypto startup followed a more traditional startup fundraising model: pounding the pavement of Sand Hill Road.

And pound they did. From 2012 to 2016, startups that developed or harnessed blockchain technology raised increasing sums of money from venture capitalists. Using data provided by Coindesk (a news publication that focuses on crypto), here’s how funding played out from 2012 to 2017 for blockchain-based startups, which you can observe in the chart below:

However, as you can see, deal counts peaked in 2014 and have not recovered since. And 2017 also marked the first time totals for funding into the space took a hit. (Crunchbase data indicates similar funding direction.)

There are a number of factors that could contribute to this dip.

It’s possible that VCs, much as they did with Filecoin, are quietly participating in funding events via ICOs. There is also talk that startups, especially early-stage startups, are forgoing the sometimes onerous terms VCs offer in favor of an ICO. Simply put: who needs venture capital when you can raise your seed, early, and late-stage funding all in one swoop, without all that pesky due diligence and talk of preferred shares with a coin offering?

Additionally, blockchain funding is experiencing a seed-stage crunch—a woe of the broader US startup and venture market. In 2014, an estimated 65 known seed-stage deals were reported in the CoinDesk dataset. By 2017, however, that number dropped to an estimated 11 known seed-stage startups being funded. Over half of the blockchain startups which raised VC funds are recorded as being based in the United States.

How long this boom will carry on is anyone’s guess. ICOs could continue to be popular funding methods, especially if VC interest in blockchain startups continues to decline, regulation stays uncertain, and the environment for early-stage startups maintains its drought-like conditions.

Or the bubble could pop tomorrow, marking 2018 as the year HODL breaks.

1. Crunchbase added ICO tracking in 2017. The funding method’s nascency means that we are walking in new pastures. As such, we have a slightly lower levels of confidence that any single dataset is fully accurate when it comes to ICOs. Datasets (some of which we have used in reporting) can differ in terms of when a funding is recorded, and, say, in terms handling pre-sales to ICOs proper. Regardless, Crunchbase News checked Crunchbase data against other data sources (using only intervals when they appeared to be updated regularly) and found our results to be contentedly in-line directionally.

Illustration: Li-Anne Dias

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And while sexism was not born in Silicon Valley, sexual harassment is proving to be toxic for business as experienced by Uber, SoFi, Binary Capital, and others. As part of our larger Q4 and 2017 coverage, let’s see how the venture industry invested in women last year.

Female Founders By First Funding Year

As part of Crunchbase’s continuing study of female founders, we count 54,702 global companies with founders that had an initial funding between 2009 to 2017. Of these global companies, 8,821 (16%) have at least one female founder.

From 2009 to 2012, the percent of venture-funded companies with women founders increased by nearly 8 percent. However, the percentage of women-founded venture-backed companies globally has plateaued at approximately 17 percent since 2012. And as we come to the end of 2017, six years on, that percent has not shifted.

The absolute number of companies (along with the total number of startups) with a female founder grew more than eightfold from 186 in 2009 to 1,588 in 2016. This number went down to to 1,047 in 2017 as fewer startups were funded during the year. As more startups are added to Crunchbase in 2018 with initial funding accredited to 2017, we expect the 2017 absolute count of startups with a female founder to go up; however, it may not reach the absolute numbers recorded in 2016.

Seed-Stage Funding In Female-Led Startups

Seed amounts in female-only founded startups since 2012 hovered between four and five percent of all seed dollars, with 2017 representing six percent with $277 million invested. Female-and-male co-founded teams hovered between 11 and 13 percent. Male-only founded teams raised between 85 and 83 percent of all seed invested dollars, dipping to 83 percent in 2017.

Venture Funding In Female-Led Startups

Venture amounts in female-only founded startups since 2012 have remained at three percent of all venture dollars, representing $3.8 billion in 2017. Female-and-male co-founded teams hovered between seven and eight percent, rising to 10 percent in 2017. Male-only founded teams raised between 86 and 90 percent of all venture invested dollars, dipping to 86 percent in 2017.

Women Aren’t Being Funded Equally

How much funding female founders raise is a critical number for the industry. We reported earlier in 2017 that, at the seed stage, women-only teams raise on average $82 for every $100 a male-founded team raises. For early-stage venture, women fared worse with an average $77 for every $100 a male-founded team raised since 2010.

Women In Venture Report

For our “Women In Venture” report, the number of female partners at the top one hundred venture firms went up by one percent, over the last eighteen months, from seven to eight percent. At best, this increase in women VCs is glacial progress. This represented 64 female partners out of 752 partners at the top 100 firms.

2017 has not been a watershed year when it comes to the amount of funding female founders raise. However, it has been a year in which the celebration of frat boy culture in tech is hopefully on its way out.

Illustration: Li-Anne Dias

After three quarters of rising investment at early through growth stage, VCs have cut back in the fourth quarter of 2017. They participated in fewer deals and invested less capital compared to both the prior quarter and year-ago periods, according to Crunchbase projected data. (For a quick explanation as to why this report now includes Canada, see the end of the post.)

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Overall, investors put a projected $21.9 billion into seed through technology growth stage rounds in Q4, down from a projected $28.1 billion in Q3. Deal count fell most markedly at the earliest stages, with the projected number of closed rounds for seed-stage startups down by more than one-third from the prior quarter.

The Q4 pullback contrasts with upbeat comparables for the full year. For all of 2017, U.S. and Canadian startup investors put a projected $89.4 billion to work, up from $82 billion in all of 2016. A smattering of really big, mostly late-stage rounds, boosted by SoftBank’s unprecedented spending spree, contributed to the higher annual totals.

Below, we look at some of the key data points for the just-ended quarter and year, including early and late-stage funding, round counts, M&A, and IPOs.

Adding It All Up

First, we’ll look at investment totals for the quarter and full year. Broadly, Q4 showed some pullback from Q3, but projected investment totals were still up year-over-across most stages for 2017.

Quarterly Totals

Let’s start with Q4 numbers. Out of the $21.9 billion in projected total investment for the quarter, about 44 percent, or $9.7 billion, went to late-stage deals.

Another 12 percent, or $2.6 billion, went to technology growth rounds, a newly redefined category for Crunchbase News that includes many of the big financings for established unicorns. (For stage definitions, see the bottom of the post.)

Early stage (Series A and B) rounds, meanwhile, drew $8.7 billion in Q4, boosted by some unusually large deals. Seed and angel deals, which are always the smallest in dollar terms of any stage, brought in a projected $886 million.

In the chart below, we look at investment totals by stage for Q4 and the preceding four quarters. It should be noted from this that the notion of a Q4 pullback is relative. The third quarter of 2017 was a particularly strong one for early through growth stage investment. So while Q4 was down quarter-over-quarter, it still ranked third for total funding out of the past five quarters.

As usual, a handful of big deals made an outsized contribution to the quarterly totals.

At the late stage, the largest round was for Magic Leap, a developer of virtual reality display technology that raised $500 million in Series D funding in October. Another big funding recipient was Compass, a technology-driven real estate platform that secured $550 million in Series C financing during the quarter.

At the early stage, Grail, a developer of diagnostics for early cancer detection, closed a $1.2 billion Series B round, the largest early-stage deal for Q4. Following Grail was a $200 million Series B for augmented reality game developer Niantic, developer of the hit game Pokemon Go.

Annual Totals

Now let’s turn to the 2017 numbers. Total projected venture investment was up year-over-year at every stage, but rose the most at growth and late stage.

As previously noted, for all of 2017, U.S. and Canadian startup investors put a projected $89.4 billion to work, up from $82 billion in all of 2016

From early to the technology growth stage, investment totals were up. Only seed-stage investments saw a reduction in year-over-year projected funding totals. Technology growth in particular saw the highest annual total in four years, driven in part by SoftBank’s voracious dealmaking.

In the chart below, we look at funding totals at each stage for the past four years. It’s noteworthy that while there have been fluctuations, totals across stages have ranged within the $80 billion to $90 billion range over the past three years.

Rounds Get Fewer And Bigger

The typical venture round has gotten bigger, but fewer startups are managing to secure funding.

That’s the broad takeaway from Crunchbase projections for round counts at seed through growth stage. Here’s a breakdown of what we saw.

Quarterly Round Counts

After three quarters of holding up at levels relatively flat, the number of startups securing seed and venture funding fell sharply in Q4 of 2017.

Across all stages, Crunchbase projects a total of 1,880 companies will close funding rounds in Q4, down 28 percent from Q3 and 21 percent from the year-ago quarter.

The most pronounced decline was at the seed stage. The projected Q4 seed and angel round count is just 944, down more than a third from the prior quarter and down about 25 percent from year-ago levels.

Early stage (Series A and B) is also down. Crunchbase projects a total of 742 early stage rounds for Q4 of 2017, down about 20 percent from the prior quarter and down about 13 percent from year-ago levels. Round counts were also down at late and technology growth stage, as evident in the chart below:

While it’s not entirely clear what’s driving the pullback in seed and early-stage rounds, industry insiders have been documenting the drop for a while and raised a number of possibilities. Reasons include a cyclical investor backlash to inflated seed-stage valuations, increasing preference among established investors for later stage and larger deals, and a decline in funding for new mobile app and SaaS-focused startups.

Annual Round Counts

The late-in-the-year decline in seed-stage rounds was pronounced enough to affect year-over-year comparisons. For all of 2017, projected round counts total 9,353 across all stages, down about 13 percent from the 2016 total of 10,711.

In the chart below, we look at round counts by stage over the past four years, to get a picture of how 2017 ranks. Overall, the number of late-stage and growth deals stayed relatively flat year-over-year, with investors continuing to chase big rounds for unicorns and near-unicorns. Virtually all of the decline is due to seed and early-stage trends.

Exits

As noted in the sections above, investors did put an exceptionally large amount of capital to work in 2017. But how did they do in terms of getting money back?

It’s tough to provide a precise accounting of annual or quarterly venture returns, given that purchase prices are undisclosed in many M&A transactions and share prices fluctuate massively in many IPO exits.

However, if we were to generalize for both the quarter and full year, it would probably be along these lines: Exits were pretty so-so. The IPO window was open, but public market investors were picky and fickle. Acquirers, meanwhile, kept up a decent dealmaking pace, but didn’t do a lot of really big deals.

Let’s look at some of the numbers, and significant deals.

M&A

Those waiting for big, profitable acquisitions involving venture-backed unicorns will have to keep waiting.

The fourth quarter of 2017 delivered a number of solid, high-return exits. However, like the prior two quarters, we didn’t see deals above the $1 billion mark. Instead, we saw a lot of smaller deals involving early-stage companies, a few purchases at apparent markdowns from private market valuations, and some larger transactions in the mix.

One company that made a big hit on the M&A market in Q4 was Musical.ly, the developer of a popular lip-syncing app that sold to China’s Toutiao in a deal reportedly valued at between $800 million and $1 billion. Other large transactions involved Black Duck Software, a security provider that sold to Synopsis for $565 million, and Shipt, an online grocery delivery service that Target bought for $550 million.

For all of 2017, venture-backed M&A was decidedly lackluster. Cisco’s $3.7 billion acquisition of enterprise software provider AppDynamics, announced in January, ranked as the year’s only known multi-billion dollar M&A transaction involving a venture-backed company.

IPOs

As for IPOs, 2017 was certainly more action-packed than 2016, an unusually dull year for venture-backed public offerings. The biggest IPO event of the past year was Snap’s Nasdaq debut in March. And although the self-deleting messaging provider subsequently managed to delete a huge chunk of its market capitalization, the blockbuster offering did seem to usher in a period of greater tech IPO activity.

But 2017’s IPO cohort delivered mixed results.

Top performers for the year included streaming media device maker Roku, analytics provider Alteryx, and tech-enabled real estate company Redfin.

Yet some startups that achieved IPO turned laggard. Snap made that list. So did meal kit company Blue Apron and storage technology provider Tintri, both of which ended the year with shares down more than 50 percent from their initial offer price.

For Q4 of 2017, a couple of tech offerings stood out for aftermarket performance. Shares of Stitch Fix, an online provider of clothes curated by personal stylists, were recently trading up more than 70 percent from their initial offer price. Shares of email delivery platform Sendgrid have also climbed sharply following the company’s October debut.

Looking Ahead

While the seed-stage slowdown has raised concerns about the health of the startup ecosystem, the venture industry remains awash with cash. Whether investors remain flush, however, will depend to a great extent on their ability to produce exits.

Optimists have reason to expect improvement on the exit front. In particular, some industry insiders are predicting a pick-up in big M&A deals in 2018.

Additionally, the passage of tax reform, including lower corporate tax rates and greater incentives to repatriate capital, could lead to a rise in big-ticket deals involving U.S. startups.

Others, however, maintain that inflated startup valuations are keeping acquirers away. And while those valuations could certainly be corrected, it’s not the outcome startup investors would prefer.

Methodology

The data contained in this report comes directly from Crunchbase, and in two varieties: projected data and reported data.

Crunchbase uses projections for global and U.S. trend analysis. Projections are based on historical patterns in late reporting, which are most pronounced at the earliest stages of venture activity. Using projected data helps prevent undercounting or reporting skewed trends that only correct over time. All projected values are noted accordingly.

Certain metrics, like mean and median reported round sizes, were generated using only reported data. Unlike with projected data, Crunchbase calculates these kinds of metrics based only on the data it currently has. Just like with projected data, reported data will be properly indicated.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to US dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs, and other financial events as reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Why US And Canada?

For the first time, in this latest quarterly and annual report, we shifted our data collection to include both the U.S. and Canada. Previously, we reported U.S.-only quarterly numbers, in addition to our global reports. The reason for including Canada was in part to provide a differentiated dataset. We noticed that there are a few reports that come out covering the U.S. venture scene, and some data on Canada, but not much focused on North America more broadly. (We thought about a broader North American dataset that includes Mexico, but due in part to differences in the rate and timing of self-reporting of startup funding, we deemed this might not fully capture the breadth of Mexican investment activity.)

Glossary of Funding Terms

• Seed/Angel include financings that are classified as a seed or angel, including accelerator fundings and equity crowdfunding below $5 million.
• Early stage venture include financings that are classified as a Series A or B, venture rounds without a designated series that are below $15M, and equity crowdfunding above $5 million.
• Late stage venture include financings that are classified as a Series C+ and venture rounds greater than $15M.
• Technology Growth includes private equity investments in companies that had previously raised venture funding.

Illustration: Li-Anne Dias

This report from Crunchbase News takes a deep dive into the state of the global venture capital ecosystem, with the help of data and projections from Crunchbase. Here, we want to assess both investment and liquidity, or what we call Money In and Money Out.

In the Money In section, we will cover Crunchbase’s projections of how much capital venture investors deployed in both Q4 2017 and throughout the year as a whole. When possible, comparison to prior quarters and years will be made.

In the Money Out section, we will review acquisition statistics compiled by Crunchbase and highlight other notable liquidity events like initial public offerings (IPOs).

To help make this report more digestible, each section will include a Q4 2017 and Annual key finding summary.

Money In

• Q4 Key Finding. Venture capital dollar volume and deal counts are down for most stages of funding relative to figures from Q3 2017, with angel and seed-stage deals leading the decline.
• Annual Key Finding. Despite Q4’s downward trend compared to Q3, 2017 closed out ahead of previous years in terms of total venture deal and dollar volume. Early-stage deals drove most of the increase in deal volume, while increases in late-stage and technology growth investment can be credited for much of the dollar volume expansion for the year.

Venture Capital Landscape Overview

It’s often the case that progress takes two steps forward and one step back. While this may feel frustrating to those experiencing the setback, it’s important to remember that, on net, VC investment is are one step further along than it was before.

That principle holds true in venture as well. After close to a year of consistent quarterly growth across almost all stages of funding, the fourth and final quarter of 2017 brought that trend to its inevitable conclusion. This all comes despite record-breaking highs on public stock markets in the US and elsewhere, a surprising level of geopolitical calm given the noise on social media, and continued advancements in new technologies. Maybe everyone was too busy fixating over the price of bitcoins and its cousins to make deals in dowdy old fiat currency.

Regardless of the reason, the math still works out favorably: the global venture capital market underwent a growth spurt that lasted a solid three to four quarters, depending on which metric you are looking at. And although Q4 2017 represents a step back, it caps off a strong year for the global venture investing market as a whole.

Global VC Funding: A View From Above

In this section, we’ll take a high-level look at the state of the global venture capital market. In broad strokes, we’re going to examine both the overall size and quantity of venture capital deals in the fourth quarter and in 2017 more generally. After a broad look, we will take a look at funding statistics on a stage-by-stage basis.

Pace Of Dealmaking

In the context of previous quarters and previous years, we can start answering, with the benefit of hindsight, how did the last quarter or year stack up?

Below, we’ve charted the projected count of venture capital rounds in Q4 2017 and the four prior quarters. (For more information about Crunchbase’s projections and methodology, see the Methodology section at the end of this report.

In Q4 2017, venture investors around the world retraced their steps from Q3, which was the most active quarter – globally speaking – since the collapse of the Dot-Com bubble.

Crunchbase projects an overall quarterly decline in aggregate venture deal volume of just under 13 percent. The pace of dealmaking slowed across all stages, but the downswing was primarily driven by a significant decline in round count at the earliest stage of venture funding—the angel, seed, convertible notes, and related deal types that make up the bulk of venture deal volume around the world.

Although Q4’s slowdown in venture dealmaking marks an end to a four-quarter period of growth, in the big picture, Q4 venture deal volume—a projected 5,339 rounds in total—was still above a three-year average and almost two percent larger than the fourth quarter of 2016.

Venture deal volume has been relatively stable for the past several years, as we’ll see in the chart below, which displays Crunchbase’s quarterly projections since the beginning of 2014.

As the chart shows, venture capital deal volume ebbs and flows in fits and starts; however, the global market continues to grow. Crunchbase projects that in 2017, nearly 22,700 venture deals were struck, up 3.6 percent from 2016’s totals, which is largely attributable to an increase in early-stage dealmaking.

Projected VC Dollar Volume

Even if movement in global venture dollar volume doesn’t precisely mirror shifts in deal volume, it certainly rhymes.

In the chart below, we plot Crunchbase’s projections for venture dollar volume in Q4 2017, as well as the preceding four quarters.

As is the case with the count of deals, projected global venture dollar volume pulled back from previous record highs in the final quarter of the year. At a projected total of $53.7 billion in venture capital deals around the world, Q4’s totals shrank 19.5 percent since Q3 2017. Declines in early-stage and late-stage deal volume led the downward charge.

However, venture dollar volume in Q4 2017 was still larger – by a factor of 33.4 percent – than the same time period in 2016. And if one were to zoom out and look at 2017 as a whole, this pattern of annual growth is similar.

Below, we graph Crunchbase’s projections for global venture dollar volume, on a quarterly basis, since the beginning of 2014:

Unlike deal volume, sussing out a trend in global venture dollar volume isn’t that hard. The general trajectory is definitely up and to the right over time. Crunchbase projects a total of $213.6 billion flowed from investors to ventures over the course of 2017, an increase of 23.6 percent from 2016. Across all stages, dollar volume was higher in 2017 than the previous year, but late-stage dollar volume grew the most, a 25.7 percent increase representing $21 billion in added capital.

Most Active Lead Investors

With a decent understanding of the size and shape of the venture capital market in Q4 and 2017 as a whole, let’s take a closer look at some of the most active participants in that market. In more ways than one, leadership matters in the venture capital business, but here we are focusing specifically on the number of rounds a given investor led.

Using Crunchbase data for over 15,700 venture capital deals struck throughout 2017, we identified 4,360 individual investment groups that led at least one funding round. And in the chart below, you can find some of the most prolific among them, ranked by the number of rounds they led, according to Crunchbase data.

These investors will be familiar to those who read Crunchbase News’s global venture capital reports for Q1, Q2, and Q3 of this year, considering that these investors ranked high on those quarters’ lists of round leaders. In other words, it’s the usual suspects, which primarily consists of:

• Well-established firms such as Sequoia Capital and New Enterprise Associates make the list.
• Accelerator programs like Y Combinator and 500 Startups.
• Big corporate-backed funds like GV (Google Ventures), Tencent Holdings, and SoftBank, the latter of which went on quite the investing spree this year, as Crunchbase News has covered.

It is important to note that there were many rounds in the dataset for which a lead investor wasn’t explicitly listed. However, more often than not, some investor led a round. So in reality, some of the round leadership statistics cited above are larger than reported here, and it is subject to change over time as new data is added.

Of course, there’s going to be some variation in the ranks from quarter to quarter and year to year. But the ranking above points directionally to the most active investors operating in the market today.

Stage-By-Stage Analysis Of Q4 2017 & Annual VC Funding Trends

Earlier, we referenced a section where we’ll paint a picture of the global venture investment ecosystem with a much finer brush. We finally made it.

To start, we will go close to the metal by looking at seed and angel-stage deals and then move further up the stack.

Angel And Seed-Stage Deals

With few exceptions, seed and angel-stage companies don’t raise a lot of capital. Still, it’s an important category to understand well. Because today’s seed and angel-stage companies are at the wide end of the funding funnel, looking at this population of startups today can point to what the early-stage and late-stage deal flow pipeline will look like a few years from now.

Below, we’ve plotted Crunchbase’s projections for seed and angel-stage deal and dollar volume, which also includes equity crowdfunding rounds and a few other round types. (Again, to learn more about these categorizations, check out the methodology section at the end of this report.)

This is a small but mighty asset class. Although seed and angel-stage deals accounted for just 4.4 percent of total dollar volume in Q4 2017, they represented 58.5 percent of the total deal volume.

When comparing Q4’s performance to Q3, angel and seed-stage deals are also the only bright spot in the global venture funding ecosystem. Dollar volume into seed and angel-stage deals was up by 11.3 percent. For all other stages, dollar volume was down on a quarterly basis. Compared to Q4 2016, projected dollar volume is up roughly 17.5 percent.

However, this bright spot is somewhat tarnished by a downswing in deal volume. Compared to the high point of Q3 2017, there was quarter-over-quarter downswing of 15.8 percent in seed and angel-stage deal volume. Relative to the same time last year, deal volume is also down 2.1 percent from a projected 3,193 seed and angel-stage rounds in Q4 2016 to 3,126 rounds in Q4 2017.

Looking at deal and dollar volume in 2017 as a whole, though, a slightly rosier picture emerges. With a projected $8.5 billion invested in over 13,700 seed and angel-stage deals around the world throughout 2017, both of these key metrics are up. Seed and angel-stage deal volume is up a modest 1.6 percent; meanwhile, dollar volume grew by a more noteworthy 8.1 percent since 2016.

But capital and deal volume is just part of the story, though. In the chart below, we show the growth of average and median seed and angel-stage rounds. Now, before continuing, it’s important to mention that the numbers below reflect known deals of this stage in Crunchbase. The chart below – and, indeed, all of the following charts which display average and median round sizes – is based on reported data. This is unlike the charts for deal and dollar volume, both of which display projected data.

Seed and angel-stage round sizes broke the trend of stagnation in Q4 2017. On both a quarterly and year-over-year basis, average and median round sizes grew by a notable margin. Relative to Q3 2017, the average round grew by a respectable 58.2 percent and, remarkably, median round sizes more than doubled. Compared to Q4 2016, the average round is now 63.5 percent larger and median round size is up 80.13 percent.

This slow, creeping year-over-year growth in round size is a pattern that is repeated across most other stages of venture funding. In the case of seed and angel-stage deals, the change may appear starker. For example, the yearly average for rounds raised in 2015 was a comparatively paltry $710,000, and the median round size for that year was $320,000. Relative to 2017’s average of $1.05 million and median of $527,000, we are looking at growth in the roughly 50 to 65 percent range for seed and angel-stage rounds around the world. Again, this is based on reported data, which is subject to change as new data is collected by Crunchbase.

So which firms are the most active investors in companies of this stage? Using Crunchbase data, we identified 6,554 institutional and individual investors that participated in at least one seed or angel-stage deal in 2017. We then ranked them by the number of deals they participated in, which you can view in the chart below:

Again, like with the lead investment rankings, this chart shows the types of firms one would expect to see here, namely accelerator programs like SOSV and Techstars, and dedicated seed funds like Right Side Capital Management. After all, these are firms in the business of investing in early-stage businesses at scale.

Early-Stage Deals

Early-stage – primarily Series A and Series B rounds, with a smattering of others included – is up next. And in what will no doubt become an all-too-familiar pattern throughout the remainder of this report, both deal and dollar volume were down in Q4 despite significant gains earlier in the year.

Below, we charted Crunchbase’s projections for early-stage deal and dollar volume.

Now is where we start to see trends that are more representative of the market as a whole. In Q4, early-stage investments accounted for 33.7 percent of the rounds and 34.2 percent of the dollar volume, enough for changes in this segment to affect the performance of the entire market.

So what about those changes?

On a quarter-over-quarter basis, deal and dollar volume both declined from previous highs to the tune of 6.15 and 18.7 percent, respectively. However, compared to Q4 2016, early-stage deal volume is up by 8.1 percent, while early-stage dollar volume in Q4 2017 is up a more striking 43.7 percent.

Zooming out to focus on 2017 as a whole, early-stage venture investment also grew. Crunchbase projects that in 2017 a total of $70.18 billion was invested in just short of 7,200 early-stage deals around the world. Dollar volume was up roughly $2.32 billion, or 3.4 percent, from 2016. On the deal volume front, Crunchbase projects that there were 382 more early-stage deals in 2017, up 5.6 percent since 2016.

Shifting now to the size of deals over time, let’s look reported early-stage rounds in the chart below:

After a sustained run-up in the average size of early-stage rounds, that growth seemed to trail off in the last quarter of 2017 with a decline of roughly 6.2 percent. However, median round size continued on its upward path with a gain of 13.3 percent from Q3 2017. Compared to the same time last year, both average and median round sizes are appreciably higher, growing by 40 and 31.7 percent, respectively.

The aforementioned upward creep in round sizes is also readily apparent in early-stage deals as well. The average early-stage round in 2017 was $12.01 million, compared to $11.8 million in 2016 and $10.25 million in 2015. And a similar trend can be found with median round size too. 2017’s median of $5.97 million compares favorably to the $5 million median from both 2016 and 2015.

And regarding the firms which invest those larger and larger checks, we haveve charted the top-ranked firms out of the 3,633 unique firms and individuals that participated in early-stage rounds around the world in 2017.

Late-Stage Deals

As with early-stage deals, late-stage deal activity is a sizeable chunk of the overall market, perhaps especially so in Q4 2017 due to significant gains in that segment of the market. Representing just under 7 percent of the overall deals struck in Q4, late-stage deals accounted for 52.8 percent of total dollar volume, making the global venture capital market somewhat top-heavy.

To assess how late-stage deal and dollar volume from Q4 stack up to previous quarters, see the chart below which displays projected Crunchbase data for late-stage deal activity.

Q4 brought about the end of a year-long run-up in global dollar volume, and a period of expansion for round counts that stretches back five quarters to Q3 2016. At least for dollar volume, quarterly declines were quite modest, falling only by 2.6 percent. A drop of 16.25 percent in deal volume since last quarter, though, is less modest.

Compared to the same period last year, total late-stage deal volume in Q4 2017 is up 7.9 percent, and dollar volume is up 61.6 percent.

Gains like that, in percentage terms, are definitely notable, but it’s when you pull back and think of those gains in dollar terms that things begin to encroach into mind-boggling territory. To magnify this effect, let’s look at last year as a whole.

Crunchbase projects that a total of about $102.81 billion was invested in late-stage venture deals in 2017, up 11.2 percent or $21.03 billion more than the previous year. For reference, that’s a smidge under Papua New Guinea’s projected nominal GDP for 2017. Just three years ago, in 2014, a projected total of $60.91 billion was invested in late-stage deals. 2017’s total, some $41.9 billion greater than 2014’s, is a bit larger than the projected nominal GDP of the Democratic Republic Of The Congo.

For the sake of completeness, let’s touch on annual changes in deals, too. 2017’s projected total of 1,577 late-stage deals struck with companies from around the world is 11.2 percent higher than 2016’s projected total of 1,418.

More money flowing in, in the context of relatively smaller increases in the number of rounds, would lead one to correctly believe that round sizes have been creeping up. Below, we plot reported data from Crunchbase for late-stage round sizes over the past year:

Since the previous quarter, the average late-stage venture deal grew by 16.8 percent, while the median grew by 13.3 percent. But it’s perhaps in late-stage deals that the annual trend of growing round sizes becomes even more apparent. Compared to Q4 2016, the average late-stage deal is 48.4 percent larger, and median deal size is up 31.7 percent.

Earlier, we said that due to the small number of late-stage deals, relative to total dollar volume those deals account for, we can think of the global VC market as “top heavy.” Put differently: you could also think of late-stage venture capital as a small pond with some fairly big fish. Let’s take a look at the investors that angled for the most late-stage deals in 2017. The chart below shows the top-ranking investors out of an initial pool of 2,383 firms that invested in one or more late-stage venture deals last year:

Technology Growth Deals

Let’s start the discussion of “technology growth” by saying up front that it is a bit of an oddball category. These super late-stage private equity deals, often struck with companies prior to going public, presented the Crunchbase News team – and indeed the rest of Crunchbase – with some challenges in the past.

In our Q1 and Q2 reports, you could find plenty of ungainly charts covering this category of funding. However, by the time we wrote the Q3 report, it had become clear that there was something wrong with how the data for this stage of funding was compiled. Due in no small part to SoftBank’s rip-roaring splurge on late-stage startup equity in that quarter, we realized that gaps in the data were so large and disjointed that we opted to do away with covering the category altogether—until this report.

In collaboration with Crunchbase’s data team, the News team worked to redefine what “technology growth” is, as a category.

The old definition, in plain English: “Any ‘private equity round in which a ‘venture’ investor also participated.”

You could see how this is a problem. What if there was only one listed investor and it isn’t a “venture” investor, such as in the case of a $4.4 billion PE round raised by WeWork from SoftBank?

Here’s the new definition of technology growth in plain English: “Any ‘private equity’ round raised by a company that has previously raised ‘venture’ financing in a prior round, such as a seed round or Series C.”

In the chart below, we plot Crunchbase projections for technology growth rounds in Q4 2017 and in the year preceding it.

As is the case with late-stage rounds, technology growth had a bit of a bull run for over a year, but that came to an end in Q4. Compared to the prior quarter, growth-stage deal volume declined 29.3 percent, and dollar volume dropped by 64.5 percent.

Unlike other types of funding rounds, there is no “one size fits most” solution at the technology growth stage. As we can see in the chart below, average and median round sizes are sporadic.

Because of the somewhat helter-skelter distribution of average round sizes, we’ll skip those and focus on median round sizes instead. The median round size in Q4 2017 is 90.7 percent larger than the preceding quarter. Relative to the same period last year, the median tech growth round is 87.8 percent larger.

Money Out

• Q4 Key Finding. Q4 2017 continued to show that the IPO window remains open, but M&A options continue to dwindle as acquisitions of venture-backed companies continued to decline further from Q3.
• Annual Key Finding. 2017 was a surprisingly strong year for technology IPOs, and a welcome relief to both public and private-market investors who thought the deals would stop flowing. This being said, M&A activity for venture-backed startups in 2017 was the weakest it’s been in years.

Venture-Backed Acquisitions

We’ve spent a lot of time in the previous sections focused on the “input” side of the venture capital equation, but we’d be remiss to not mention the output side as well.

Mergers and acquisitions is one of the two primary ways capital is returned to venture investors, ideally in a greater amount than they put in.

In the chart below, we have plotted reported data for venture-backed mergers and acquisitions in Q4 and prior quarters.

Similar to technology growth rounds, total dollar amounts can be a little chaotic. All it takes is one or two massive M&A events (like any one of these $1 billion+ deals from 2017) to skew an entire quarter’s numbers artificially skyward; therefore, we’ll focus on deal volume as the primary metric here.

As we’ve pointed out in previous reports, there appears to be a general downtrend in M&A activity for venture-backed companies. According to Crunchbase data, it peaked in Q2 2016 (not pictured in the chart above) with 364 exits, and it has been somewhat downhill from there. Between Q3 2017 and Q4 alone, venture-backed M&A deal volume declined roughly 10.5 percent. From its peak in Q2 2016, deal volume has declined by 20.6 percent, leaving venture investors with ever-fewer options to get their cash back.

Below, we’ve shared some of the more notable acquisitions from the final quarter of 2017. Most, but not all, of the acquired companies listed here received venture funding at some point.

Initial Public Offerings

Initial public offerings (IPOs for short) are the second primary way venture investors can cash out their positions in a company. (There are other options out there, but that’s outside the scope of this report.)

After a long cold spell throughout 2016, the tech IPO market finally thawed out in 2017. Q4 continued the momentum of prior quarters with a number of notable tech IPOs, a selection of which we’ve listed below.

There are no clear signals of what the 2018 tech IPO market might look like, but it’ll probably be impressive. A number of large private companies stand a fairly decent chance of going public – or at least filing initial paperwork with the SEC to do so – in the next year or two. According to press speculation reviewed for this report, this list of companies may include the likes of Lyft, Dropbox, Cloudflare, Xiaomi, Zscaler, Qualtrics, and others.

Given the somewhat tepid response to consumer-focused offerings like Snap and Blue Apron earlier this year, it’d be safe to assume that the IPO market in 2018 will continue to favor more enterprise-oriented companies.

Conclusion

Although the tone of the Overview section was decidedly optimistic and cheerful, it’s important to acknowledge that Q1 2018 and beyond is not without its headwinds.

For better and worse, the United States has led the world in venture deal and dollar volume, and as Crunchbase News has reported previously, there appears to be a slow hollowing-out of the early-stage pipeline. That may not seem like such a big deal today, but don’t be surprised if several quarters down the line there are fewer big deals (forgive the pun) being struck around the world.

There are other, smaller ones too. A new tax plan in the US may threaten the country’s financial stability in the coming quarters and years. The threat of geopolitical conflict in the vicinity of China—one of the largest VC markets outside the US—looms large. Cryptocurrencies and other shiny blockchain geegaws may distract investors from more traditional technology startups. Hell, there was just an earthquake, albeit a small one, in the Bay Area.

Lots of stuff can happen.

Perhaps the cooling-off period at the end of last year is a good thing. In the conclusion of the Q3 report, we referenced the Greek mythical figure of Icarus, who flew his wax wings too close to the sun. With some time off the heat the market can take some time to firm up a bit before taking off again.

Methodology

The data contained in this report comes directly from Crunchbase, and in two varieties: projected data and reported data.

Crunchbase uses projections for global and U.S. trend analysis. Projections are based on historical patterns in late reporting, which are most pronounced at the earliest stages of venture activity. Using projected data helps prevent undercounting or reporting skewed trends that only correct over time. All projected values are noted accordingly.

Certain metrics, like mean and median reported round sizes, were generated using only reported data. Unlike with projected data, Crunchbase calculates these kinds of metrics based only on the data it currently has. Just like with projected data, reported data will be properly indicated.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to US dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs, and other financial events as reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of Funding Terms

• Seed/Angel include financings that are classified as a seed or angel, including accelerator fundings and equity crowdfunding below $5 million.
• Early stage venture include financings that are classified as a Series A or B, venture rounds without a designated series that are below $15M, and equity crowdfunding above $5 million.
• Late stage venture include financings that are classified as a Series C+ and venture rounds greater than $15M.
• Technology Growth includes private equity investments in companies that had previously raised venture funding.

Illustration: Li-Anne Dias