Trends in Venture Funding in 2015

Trends in Venture Funding in 2015

Trends in Venture Funding in 2015

Despite a slowing in early-stage investments and the promise of equity crowdfunding, venture capital remains the key source of funding for startups. However, the money has not flowed equally between industries and locations. DataFox crunched the numbers on private U.S. companies that closed funding rounds between January 1st, 2015 and December 6th, 2015 to find broader trends in venture capital.

To date, U.S. private companies have raised $76.06 billion in venture funding this year.

Where did the money go?

According to a DataFox analysis, of the 7,000+ U.S.-based private companies that closed a round this year, by far the most investments went into companies with 11-50 employees: Funding by Headcount

This is unsurprising, given that very early stage investments are being perceived as risky, fewer companies survive long enough to hire 51 employees, and large companies are less likely to be privately held.

Most investments were also fairly substantial, with the bulk of funding rounds raising between $1 million and $50 million:

Screen Shot 2015-12-02 at 4.16.26 PM

Finally, nearly half of the funding went to late-stage companies (those raising a Series D round or later). Larger companies often need more capital to expand - Uber, for example, is reported to have raised a whopping $2.1 billion in its latest funding round.

2015 funding by stage

2015's most prolific investors

Y Combinator and TechStars led the pack with 151 and 150 investments respectively, followed by New Enterprise Associates (135) and 500 Startups (131). As expected, accelerators racked up the highest number of investments, but traditional, non-accelerator venture firms had a substantial presence as well:
Investor Companies Invested In
Y Combinator 151
Techstars 150
New Enterprise Associates 135
500 Startups 131
SV Angel 120
Andreessen Horowitz 100
Kleiner Perkins Caufield & Byers 96
Google Ventures 93
Accel 91
Silicon Valley Bank 82

Cities with the most venture funding in 2015

Which cities received the most venture capital funding in 2015? An infusion of funds allows companies to invest more in their employees and communities, and what's more, the perception of available capital is a major draw for entrepreneurs as they decide where to start a business.

DataFox crunched the numbers on companies that closed a funding round in 2015 to find the cities that drew the most capital. We looked only at private companies that have not been acquired or closed down this year, and cities with funding rounds closed by at least five companies. Here are the 20 cities that received the most venture funding in 2015:

Rank City Total Funding Raised Companies Receiving Funding
1 San Francisco $13.52 billion 729
2 New York $7.74 billion 691
3 Cambridge $2.33 billion 124
4 Boston $2.16 billion 186
5 Austin $2.05 billion 176
6 Palo Alto $1.86 billion 136
7 Mountain View $1.62 billion 101
8 Seattle $1.60 billion 188
9 Houston $1.44 billion 40
10 Chicago $1.26 billion 126
11 Redwood City $1.25 billion 60
12 San Mateo $1.19 billion 58
13 San Diego $1.03 billion 116
14 Los Angeles $1.01 billion 115
15 Sunnyvale $.76 billion 62
16 San Jose $.65 billion 61
17 Menlo Park $.60 billion 50
18 Atlanta $.59 billion 67
19 Dallas $.59 billion 50
20 Irvine $.56 billion 36
Though dominated by Silicon Valley, this list does have a few surprises: Cambridge and Boston, fueled by a biotech boom, ranked just below San Francisco and New York; Texas also had a strong showing with Austin, Houston and Dallas making the cut.

DataFox uses machine learning and natural language processing to predict growth, analyze industry trends and find similar companies - all in just a few clicks. Learn more about DataFox's company research and intelligence platform.