Assessing First Quarter Corporate Venture Investment Data

Corporate venture groups invested $2.2 billion in 196 deals to U.S.-based companies in the first quarter of 2015, according to the MoneyTree Report™ from PricewaterhouseCoopers LLP (PwC) and the National Venture Capital Association (NVCA), based on data provided by Thomson Reuters.  Corporate venture accounted 16.6% of total venture dollars invested and 19.0% of all venture deals for the quarter.  Total dollar investment in the first quarter is up significantly compared to the fourth quarter of 2014 when corporate venture groups deployed $1.4 billion in 199 deals.  Part of the dramatic increase can be attributed to a $900 million investment by Google Ventures in SpaceX.

“By all measures, the first quarter was a very active period for corporate venture groups, almost doubling the total amount of capital deployed to the startup ecosystem from the previous quarter,” said Bobby Franklin, President and CEO of NVCA.  “While the one-time investment of $900 million to SpaceX by Google Ventures accounts for this spike in total dollars deployed, corporate venture groups still accounted for 19% of all venture capital deals for the quarter, an impressive showing that is likely to increase as more and more corporations launch corporate venture groups or reactivate dormant ones.”

Industry Analysis

In a shift from previous quarters, the Industrial/Energy sector received the highest level of funding of all industries in the first quarter with corporate venture groups deploying $963 million in 9 deals, representing 43.6% of total corporate venture capital dollars deployed.  This jump to the top can be attributed to the investment by Google Ventures in SpaceX.  Software companies received the second highest level of corporate venture dollars for the quarter with $681 million invested in 96 deals, representing 30.8% of total corporate venture capital dollars deployed.  Biotechnology companies received the third largest total investment amount by corporate venture groups during the quarter, accounting for $249 million in 29 deals, representing 11.3% of total corporate venture capital dollars deployed.

Corporate venture investing in the life sciences sector, which includes biotechnology and medical devices, totaled $275 million in 28 deals.  As a percentage of overall venture investing in life sciences companies during the first quarter, corporate venture represented 12.7% of all dollars invested and 19.6% of deals.

Looking ahead, NVCA will release our corporate venture investment data for the second quarter on July 18, 2015.

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