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PricewaterhouseCoopers / Thomson Venture Economics / PricewaterhouseCoopers / Thomson Venture Economics / National Venture Capital Association MoneyTreeNational Venture Capital Association MoneyTree Survey Survey

Q2 2003 UpdateQ2 2003 Update

August 2003August 2003

by:by:Victor PetriVictor PetriGlobal Sector LeaderGlobal Sector Leader

Shaking the MoneyTreeShaking the MoneyTree

3 PricewaterhouseCoopers / Thomson Venture Economics / National Venture Capital Association MoneyTree™ Survey

About The SurveyAbout The Survey

• PricewaterhouseCoopers collaborates with Thomson Venture Economics and the National Venture Capital Association to produce the MoneyTree™ Survey

• ‘Core’ measure of equity investments in venture-backed companies in the United States

• Companies have received at least one round of financing involving a professional VC firm or equivalent

• Captures: tranches, not term sheets, foreign VCs, qualified private placement

• Excludes: debt, bridge loans, recaps, roll-ups, IPOs, PIPEs, leasing, etc.

• MoneyTree™ Survey in its 9th year

• Results online at www.pwcmoneytree.com, www.ventureeconomics.com, www.nvca.org


MoneyTree Total InvestmentsMoneyTree Total InvestmentsQ1 1997 – Q2 2003Q1 1997 – Q2 2003

$3.7 $3.7$4.5 $4.2

$5.9 $5.4 $6.0 $6.6

$11.2

$13.1

$23.7

$26.4

$22.7

$12.9$11.3

$8.4 $8.1$6.5 $6.0

$4.4 $4.2 $4.0 $4.3

$3.1

$28.5$28.6

$0.0

$8.0

$16.0

$24.0

$32.0

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

($ in billions)

1997 1998 1999 2000

# of Deals786

778750

9071,303

932925

1,008921

1,3451,458

1,9162,164

2,1781,983

1,813

2001

1,2771,046 821

1,0001,312 672

2002

826647

720 669

YTD 2003


Total U.S. Venture Capital InvestmentsTotal U.S. Venture Capital Investments1980 – YTD Q2 20031980 – YTD Q2 2003

$40.8

$7.6

$21.4

$4.1$3.8 $8.3

$21.2

$54.7

$106.2

$15.1$11.6

$3.6$2.3$2.8$3.4$3.3$3.3$3.1$2.8$3.0$3.0$1.7$1.2$0.6$0.0

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

'80 '82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02

($ in billions)

# of Deals467

7961,150

1,4241,507

1,4121,431

1,6271,519

1,5361,457 1,399

1,259 1,188 1,8872,642 4,168

5,6401,223

3,2218,138

4,6353,039

1,316

Annual Venture Capital Investments 1980 to YTD Q2 2003


Texas$266.8

42 Deals

Silicon Valley$1,441.2

191 Deals

New England$496.1

73 Deals

Midwest$152.0

30 Deals

South Central$19.9

3 Deals

Northwest$104.0

24 Deals

Sacramento/N. CA$8.0

2 Deals

San Diego$155.9

23 Deals

Investments by RegionInvestments by RegionQ2 2003Q2 2003

Southeast$216.5

64 Deals

Southwest$34.7

8 Deals

LA/Orange County$302.9

38 Deals

DC/Metroplex$183.1

45 Deals

NY Metro$380.4

56 Deals

Philadelphia Metro$141.4

23 Deals

North Central$80.1

19 Deals

Q2 2003 Total Investments - $4,281

($ in millions)

Colorado$229.5

18 DealsOther US/Undisclosed

$27.53 Deals

Upstate NY$33.0

4 Deals


$75

$956

$958

$2,292

$0 $1,250 $2,500

Startup/Seed

Early Stage

Later Stage

Expansion

Investments by Stage of Development -Investments by Stage of Development -Q2 2003Q2 2003

# of Deals

% Change in $ Amount from

Q1 ‘03($ in millions)

Q2 2003 Totals: $4,281 669 5.9%

325

106

200

38

(7.5%)

16.8%

(4.8%)

43.3%


$622

$775

$782

$806

$1,296

$0 $500 $1,000 $1,500

Third

First

Second

Fourth

Fifth & Beyond

Investments by Financing Sequence -Investments by Financing Sequence -Q2 2003Q2 2003

# of Deals

% Change in $ Amount from Q1 ‘03

($ in millions)

Q2 2003 Totals: $4,281 669 5.9%

172

99

142

153

103

23.5%

49.3%

5.1%

(38.8%)

11.6%


$1.5$2.0 $1.7 $2.0 $2.1

$3.7

$7.3

$8.7 $8.6

$6.3$5.6

$2.9

$1.9$1.3 $1.3 $1.3 $1.3 $1.1

$0.7 $0.7 $0.8

$3.1

$0

$1

$2

$3

$4

$5

$6

$7

$8

$9

$10

$11

$12

Q1'98

Q2'98

Q3'98

Q4'98

Q1'99

Q2'99

Q3'99

Q4'99

Q1'00

Q2'00

Q3'00

Q4'00

Q1'01

Q2'01

Q3'01

Q4'01

Q1'02

Q2'02

Q3'02

Q4'02

Q1'03

Q2'03

($ in Billions)

First Sequence Financing - First Sequence Financing - Investment AmountInvestment Amount

First Sequence Investments


347 342371

803

262

153

560

394

944 954

712

650

373327

236 207 225172 180

138

669

874

0

200

400

600

800

1,000

1,200

Q1'98

Q2'98

Q3'98

Q4'98

Q1'99

Q2'99

Q3'99

Q4'99

Q1'00

Q2'00

Q3'00

Q4'00

Q1'01

Q2'01

Q3'01

Q4'01

Q1'02

Q2'02

Q3'02

Q4'02

Q1'03

Q2'03

First Sequence Financing - First Sequence Financing - Number of DealsNumber of Deals

First Sequence Deals


25.2%27.2%

22.9%

18.6%

17.5%16.7%

25.0%

16.0%

21.7%20.0%

15.5%

32.3%

35.1%32.4%31.1%

35.7%33.9%

31.5%33.3%

31.8%27.7%

28.2%30.8%

30.4%30.2%

23.9%

24.7%

22.5%

16.8%

21.3%

25.0%25.6%23.6%

43.0%

38.0%39.6%

40.9%

54.6%

37.2%

37.0%39.1%

40.3%41.6%

44.6%45.6%

43.6%43.8%40.5%

36.9%

28.4%

25.6%

25.0%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

55%

60%

Q1'97

Q2'97

Q3'97

Q4'97

Q1'98

Q2'98

Q3'98

Q4'98

Q1'99

Q2'99

Q3'99

Q4'99

Q1'00

Q2'00

Q3'00

Q4'00

Q1'01

Q2'01

Q3'01

Q4'01

Q1'02

Q2'02

Q3'02

Q4'02

Q1'03

Q2'03

% of Total Dollars % of Total Deals

First Sequence Financing - First Sequence Financing - Percent of Total U.S. InvestmentsPercent of Total U.S. Investments

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