Venture capital (VC) investment across the world totaled US$155 billion in 2017, according to the latest edition of Venture Pulse, a quarterly report on worldwide VC trends published by KPMG Enterprise.
In the fourth quarter, there were 2,662 VC investment deals, the weakest three-month period since the fourth quarter of 2011 in terms of deal volume, according to the report released earlier this month.
Despite a continued drop in deal volume, the global median deal sizes indicated growth in every stage last year, the report showed, according to the Hong Kong Economic Journal.
The median deal size of angel and seed deals climbed from US$800,000 to US$1 million. The median deal size of early-stage deals rose from US$3.7 million to US$5 million, while that of later-stage deals jumped from US$9.5 million to US$10.8 million.
Part of a broader trend for the year 2017 was that late-stage rounds showed 70 percent of VC investment concentrated in deals of US$25 million or more.
Artificial intelligence (AI) and machine learning revealed a doubled VC investment of US$12 billion in 2017, compared to the US$6 billion such figure in 2016.
Pharmaceuticals and biotechnology registered year-over-year expansion in VC investment, rising 36 percent from US$12.2 billion in 2016 to US$16.6 billion in 2017.
In 2017, China dominated Asia’s VC market during the fourth quarter. Asia-based VC investment recorded a yearly high of over US$48 billion, which was driven by three deals each worth over US$1 billion in the fourth quarter of 2017. These include the US$1 billion to electric car company Nio, as well as US$4 billion each to Didi Chuxing and Meituan-Dianping.
The first quarter of 2018 and beyond are projected to be strong in relation to VC investment, with segments like healthtech, biotech and autotech anticipated to thrive. Moreover, AI across industries is likely to be a big draw for investments. Other areas like foodtech and agtech are also expected to receive much attention.
VC firms worldwide are striving to establish bigger global funds compared to earlier years as they face stronger competition for deals, including from the likes of Softbank which launched a US$100 billion Vision Fund.
This article appeared in the Hong Kong Economic Journal on Jan 24
Translation by Jonathan Chong
[Chinese version 中文版]
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