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04

Sep

2012

VC Jobs Count Launches PDF Print E-mail

Jeanne Metzger

Written by Jeanne Metzger   
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The NVCA has long measured job creation generated by venture-backed companies.  Established in 2001, and updated every two years, our Venture Impact report by IHS Global Insight examines the economic contribution of U.S. companies that were originally founded, financed and nurtured with venture capital.  Our alumni list is long and broad, comprising Fortune 500 companies such as Apple, Starbucks, Intel, Cisco, Genentech and FedEx.  Understandably, the collective jobs number accounted for by these organizations is impressive – more than 12 million in 2010, accounting for 11 percent of private U.S. employment.  But what did these companies’ numbers look like “before they were stars?”  And what does the job creation pipeline resemble today?

This summer the NVCA began to explore those questions.  And the logical place to start was with our member firms, asking them to provide us with the number of jobs in their current portfolio of companies.  We didn’t want to measure alumni – Venture Impact already does this quite well.  We wanted to understand – and share regularly – how our venture firms are contributing to the job creation process on a standalone basis.

Our initial list of firms and job numbers can be found here at the NVCA Jobs Count page. The number of jobs varies by firm – with larger firms and later stage investors intuitively having more jobs due to the maturity and breadth of their portfolios.  Yet, we can not discount the smaller firms and seed stage investors.  Although they may have fewer jobs in their portfolios today, these firms and their companies remain vitally important to our ecosystem, as it has been proven that 92 percent of job growth occurs after an IPO.  And we can’t forget that every single one of our alumni companies began with just a handful of employees.

With just about 10 percent of our membership now listed on the Jobs Count board, we are looking forward to adding additional firms through the Fall as well as updating those who are now listed.  We encourage you to visit often and look out for the Jobs Count badge on our member sites.  And if you want to work for one of these amazing startup companies, be sure to visit StartUpHire.com and apply to one of the thousands of open positions today!

 

 

30

Aug

2012

Medical Innovation Language Included in GOP Platform PDF Print E-mail

Kelly Sloane

Written by Kelly Slone   
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With the Republican and Democratic conventions front and center, NVCA and MedIC were pleased to see language around preserving American medical innovation included in the GOP Platform.  On page 34 of their document, we applaud the following section:

Reforming the FDA

America’s leadership in life sciences R&D and medical innovation is being threatened. As a country, we must work together now or lose our leadership position in medical innovation, U.S. job creation, and access to life-saving treatments for U.S. patients. The United States has led the global medical device and pharmaceutical industries for decades. This leadership has made the U.S. the medical innovation capital of the world, bringing millions of high-paying jobs to our country and life-saving devices and drugs to our nation’s patients. But that leadership position is at risk; patients, innovators, and job creators point to the lack of predictability, consistency, transparency and efficiency at the Food and Drug Administration that is driving innovation overseas, benefiting foreign, not U.S., patients.

We pledge to reform the FDA so we can ensure that the U.S. remains the world leader in medical innovation, that device and drug jobs stay in the U.S., that U.S. patients benefit first from new devices and drugs, and that the FDA no longer wastes U.S. taxpayer and innovators’ resources because of bureaucratic red tape and legal uncertainty.

Clearly this language dovetails with the efforts of NVCA and MedIC over the last several years and we are encouraged by the support.  We are hopeful the Democrats will also make medical innovation a priority issue in their platform, expected shortly, as well.

 

02

Aug

2012

NVCA Weighs in on "No More Solyndras" Bill PDF Print E-mail

Emily Baker

Written by Emily Baker   
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After more than eighteen months investigating the Department of Energy Loan Guarantee program, the House Energy and Commerce Committee yesterday passed H.R. 6213, the “No More Solyndras Act” by a vote of 29-19. The bill prevents loan guarantees for any applications submitted after the end of 2011, and would place new restrictions on application reviews and existing loans.

The NVCA, along with TechNet, ACORE, SEIA and E2, put out a statement against the bill saying that the program should be reformed, not shut down.  Our statement read in part, "While the DOE Loan Guarantee Program can be improved, elements of the ‘No More Solyndras Act’ go far beyond reasonable reforms and threaten to shut down a successful policy that has helped drive billions in private capital investment, supported tens of thousands of badly-needed jobs and spurred innovation across the sector.” You can read the full statement here.

The bill will be voted on by the full House in September.  However, we believe passage in the House would only send a political message rather than ensure passage of a substantive piece of legislation as it stands no chance of moving in the Senate.  Chairman Bingaman and Ranking Member Murkowski have both indicated that they see a role for the federal government in programs like the DOE loan guarantee and, despite the failings of Solyndra, the entire program is not a failure.

When it was first enacted in the energy bill of 2005, the DOE loan guarantee program had the strong support of the Bush Administration and bipartisan support. The program was accelerated and began making loans following President Obama’s 2009 economic stimulus bill.  The NVCA will continue to support the DOE loan program with a commitment to appropriate reforms to protect taxpayers.

 

26

Jul

2012

Corporate Venture Capital Remained Strong in Q2 2012 PDF Print E-mail

John Taylor

Written by John Taylor   
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Last week, we issued the MoneyTree report and with that comes an update on the investments of corporate venture capital groups.  In the first half of 2012, corporate venture capital groups were more active than 2011 levels. In 2011, venture capital groups participated in 14.7 percent of all the U.S. venture capital deals and provided 7.7 percent of the total invested dollars. In the first half of 2012, the participation rose to 16.3 percent of deals. Dollar share rose slightly to 7.8 percent. In the first half of 2012, corporate venture capital groups participated in 280 rounds and invested just over $1 billion.

Looking at sector splits over the past six quarters for corporate venture capital (CVC) groups, software is the dominant sector (27.1 percent of CVC dollars) as it is with venture capital investment.  The industrial/energy sector which contains many of the clean technology deals received 18.8 percent of the CVC dollars.

Interesting, while over the past six quarters CVC has provided 7.7 percent of total U.S. venture capital, 10.9 percent of dollars going to clean tech companies come from CVCs.  Almost one dollar in four (23.3 percent) of all CVC dollars invested go to clean tech companies ($768M of $3,292M).

The NVCA continues to assert that corporate venture capital is playing an increasingly influential role in the startup ecosystem and this quarter's numbers support that premise.

Last Updated on Monday, 30 July 2012 09:28
 

20

Jul

2012

Q2 MoneyTree Numbers Raise Concerns for Life Sciences PDF Print E-mail

Emily Mendell

Written by Emily Mendell   
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Today the NVCA along with Pricewaterhousecoopers released the Q2 MoneyTree venture capital investment report based on data from Thomson Reuters. The positive momentum was reserved for the IT sectors - particularly Internet related and software companies - as well as early stage deals and first time financings. All very positive. Unfortunately, the same can't be said for life sciences investing which saw the lowest level of biotech investment for nearly a decade. For the first half of 2012, life sciences accounted for 22 percent of the venture capital dollars invested in the U.S., a percentage that has historically been closer to 30 percent in recent years.

We asked NVCA member Jimmy Rosen, GP at Intersouth Partners, to offer some thoughts on the quarter's decline. His comments reflect what we are hearing from many life sciences investors: a recognition of the challenges in the sector but also a strong commitment among those venture capitalists investing in the space to fund life saving medical innovation.  Says Rosen:

This quarter's investment numbers for life science companies, particularly early-stage life science companies, are obviously not good. This is a trend we've been following and we lack positive indicators that it will turn around soon. As economic uncertainty continues and fewer venture investors remain, VCs are less willing to commit to companies in which capital requirements continue to increase, timelines extend and regulatory guidance is unclear. That being said, there are biotechnology and medical device companies that are making real progress towards cures. These companies will continue to be hugely important to patients and to investors as long as their solutions have the potential to increase access and decrease cost without sacrificing the quality of care. We will continue to invest in early-stage biotech and medical tech companies because they have the potential to provide real returns to investors and because they're important to patients and their families.

The NVCA continues to work with Congress and the Administration to improve the environment for life sciences investing in the United States so that we can can maintain our global leadership in medical innovation.

You can view all of today's MoneyTree data here:

Press Release

National Data including industry sector breakouts

Regional Data, including state breakouts

Top 10 deal list for the quarter

Last Updated on Friday, 20 July 2012 09:50
 

16

Jul

2012

5 Takeaways From Global Confidence Survey PDF Print E-mail

Mark Heesen

Written by Mark Heesen   
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Today the NVCA and Deloitte released the results from our first ever Global VC Confidence survey which measured the confidence levels from more than 400 investors around the world on a variety of issues. The various categories are extremely interesting and you can view the results here . But here are our top 5 big picture takeaways from this survey:

1) When it comes to overall confidence among global venture capitalists, there is significant room for improvement. Venture capitalists are eternal optimists by nature so the fact that most confidence levels averaged well below 4 (on an 1-5 scale) suggests that something heavy is dragging the industry psyche down. We believe it has everything to do with outside forces and little to do with opportunity, which brings us to the second takeaway.

2) Externalities truly impact confidence levels more than ever before, both from a market and public policy perspective. VCs were the more confident overall about investment opportunities than they were about the forces that impact those opportunities including the economic environment, capital markets, public policies and fundraising. Most concerning were the low confidence levels regarding each home country's ability to enact policies that support domestic investment where only three countries scored above 3.0.

3) With maturity comes challenges that can weigh on confidence levels. Conventional wisdom suggests that newer always feels better and that seems to hold true with investment regions and industry sectors. But that works both ways. Notably, regional hot spots of the last five years such as China and India have matured, leaving confidence levels lower than up and coming areas such as Brazil. The same seems to be the case for investment sectors such as clean tech where the capital intensive realities have impacted confidence levels of investors who were once extremely bullish on the sector in its earlier days.

4) There's no place like home. The survey suggests that investors are more confident about the economies and markets domestically than globally. Whereas earlier in 2000, there was more excitement about investing abroad, there seems to be a plateauing of enthusiasm for this strategy overall. Global economic uncertainty is clearly a driver of this but here in the US, a domestic investment strategy is also being driven by smaller fund sizes and shrinking partnerships.

5) The ebb and flow of the venture industry will always prevail. One thing is certain and that is that confidence levels are – and will always be -- highly fluid. Couple this with a venture industry that regularly moves through innovation cycles and we can only expect to see a different set of numbers next year. For our part, we hope to see an overall improvement.

 
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