venture capital records 2021

US venture investors are having their biggest year ever

‘It’s going too well,’ said one investor; ‘It feels a little surreal,’ said another

So far, the largest US fund of 2021 is Tiger Global’s $6.6 billion flagship vehicle. In addition to industry mainstays, many of the top funds were raised by nontraditional VC investors, such as Tiger and private equity giant TPG, which rolled out a $5.4 billion climate-focused fund in July.

In the race to secure a spot on cap tables of hot high-growth startups, the industry is setting up ever larger war chests — and more of them. This immense influx of capital has created an embarrassment of riches sloshing around Silicon Valley, driving a host of other eye-popping trends in 2021.

Deal Size Fuels Growth

Source: Pitchbook

Technology continues to lead the way

Source: Crunchbase as of July 1, 2021

Fintech Leads the Pack

Source: Pitchbook

Regional venture capital activity

Source: Crunchbase

Record exit values continue to rise

Source: Pitchbook

As 2020 drew to a close, big-name IPOs like DoorDash and Airbnb put a cherry on top of Silicon Valley’s banner year on Wall Street.

That has proven to be just a prelude to an even richer year in 2021. Top IPOs from the likes of Robinhood, Coinbase, Gitlab and Squarespace dominated the action. Exit value of US companies this year has risen to a record of more than $582 billion, reflecting an increase in IPO deals that initially were rich with SPAC offerings and have since cooled off. But acquisition activity remains the biggest component of overall exits.

“The market is getting bigger, and tech is a bigger part of life, so it’s natural there should be more capital for it,” said Eric Liaw, a partner with IVP. “This isn’t just a US thing anymore — it’s global — which I think is great.”

But their are some doubters…

Venture capital funds are reaping the rewards of a booming market as returns continue to improve. But the dizzying climb in startup valuations has some worried that the market euphoria is turning irrational.

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