Since the beginning of this year, global VC investments have been changing rapidly, as political tensions affected many industries in the United States, China and India. With the official opening of the STAR (Sci-Tech innovAtion boaRd), China will build a sounder financial system, which will profoundly influence China's industrial structure and economy.
EO Intelligence analyzed global VC investments in the first half of 2019 and published the 1H19 global VC investment report. This report will describe global capital trends from perspectives of overview, countries, industries and institutional investors.
Key points:
1. In the first half of 2019, the number of investments (>USD100mn) was 292, and the total financing amount was USD 98.248 billion. The market was on a stable rise and investors preferred enterprise services, biopharmaceutical, financial services, and technology startups.
2. The US, China, and India were the top three most funded countries, with 148, 55, and 21 financings respectively. Compared with the first half of 2018, the US experienced a sharp increase while China saw a significant decline.
3. The US concentrated on biopharmaceutical, enterprise services, financial services; China focused on automobile/mobility, biopharma and retail, while India paid attention to financial services and retail.
4. Ranking of the most active institutional investors: SoftBank was the best, followed by Sequoia, Tencent and GIC.
5. 1H19 top 50 most funded startups: Indian aerospace technology company Tzar was the top; 11 Chinese companies were on the list.
1. Overview of global VC investments
According to Crunchbase, as of June 30, 2019, the number of investments (>USD100mn) in the first half of 2019 was 292, and the total financing amount was USD 98.248 billion. Compared with the first half of 2018, the number of investments has increased by 26.4% while the total financing amount has fallen by 13.4%.
In terms of industries, enterprise services, biopharmaceutical, and financial services are the most-funded. Among them, the number of investments for enterprise services was 42, and biopharmaceutical and financial services were 41 and 40 respectively. Technology, auto/mobility and financial services were the top three most funded in the first half of 2019, with USD 25.843 billion, 14.731 billion and 11.763 billion respectively.
Compared with the first half of 2018, the numbers of investments in consumer and real estate have increased by more than 50%, and the numbers of investments in enterprise services, financial services and logistics have increased by more than 10%.
2. Global VC investments by countries
In the first half of 2019, the US, China, and India are the most-funded countries, with 148, 55, and 21 investments respectively, acing out the rest of the world.
Compared with the first half of 2018, the United States saw a sharp increase of 23.3%, while China was affected by the economic environment. In the first half of 2019, the number of investments fell by 43.3% in China, while India remained unchanged.
In terms of total funding amounts, India surpassed China to become the second most funded country in the world. In the first half of 2019, the total financing amount in India reached USD 20.1 billion, while that of China was USD 16.6 billion.
Compared with the first half of 2018, the US increased by 40.5%, India by 74.8%, while China declined by 71.5%. This indicates most investors were still skeptical of China's macro environment.
3. The most invested countries
Both the US and China were heavily invested in biopharmaceutical; the US was leading in enterprise services; meanwhile, China was doing well in auto/mobility, retail and logistics. India was focusing on the sectors of financial services and retail.
4. Investments (>USD100mn) by stage of financing
In terms of the distribution of financing events (>USD100mn) in different funding rounds, Series A to F rounds of financing accounted for 61.6%. Compared with the first half of 2018, it increased by 12.7%. At the same time, late-stage investment and secondary investment (mainly hedge funds) have reduced, and growth-equity investment has become the mainstream.
In terms of financing scale, the number of investments with USD 100 million to 500 million was 248, accounting for 84.9%; the number of investments with USD 500 million to 10 billion was 48; Tzar Aerospace Research Labs, an Indian aerospace technology startup, was the only startup that received more than USD 10 billion in its Series A round of funding.
Compared with the first half of 2018, the amount of financing remained stable, but the total amount of financing of USD 5 to 10 billion declined significantly. In the first half of 2019, the total financing amount of 500 million to 1 billion was USD 14.284 billion, down by 26.6% YoY; the total financing amount of 1 billion to 10 billion was USD 23.84 billion, down by 35.3% YoY. Investors were more inclined to invest in small amounts.
Average funding amount in single transaction grew only in enterprise services, technology and consumer sectors. The growth rates were 28.5%, 24.9% and 33.5% respectively, reflecting investors’ confidence in these three sectors.
5. Top 20 most active institutional investors
The most active investors in the first half of 2019 were the famous investment institutions such as Softbank, Sequoia Capital, Tencent, GIC, Tiger Fund, KKR and Temasek. Softbank Group invested 29 companies, leaving other investors far behind; Sequoia and Tencent respectively made 10 and 7 investments, but their total investment amount has been greatly reduced.
SoftBank focused on recreation, auto/mobility and financial services sectors, while investment of Sequoia and Tencent are more dispersed, but they seemed to be more interested in retail, enterprise services and financial services.
6. Startup Financing Top 50 List in H1 2019
Based on Crunchbase data, EO Intelligence has summarized a list of TOP50 most-funded startups in H1 2019. The Chinese companies listed include Chehaoduo, T3 Mobile Travel Services, JD Health, MEGVII, and Ke.com.