11/18/2009
Venture Financing Report—November 2009
In general the third quarter of 2009 showed signs of slow but continued improvement in certain financial terms and metrics while showing deterioration in others. Median pre-money valuations in earlier rounds of financing saw improvements over the first half of 2009 while median pre-money valuations in later rounds declined. During the third quarter of 2009, a higher percentage of deals were up rounds versus down or flat rounds as compared to the prior quarter, and pay-to-play provisions, drag-along provisions and fully participating preferred provisions were utilized during the third quarter at approximately the same frequency as during the second quarter.
Transaction volumes and valuations during this past quarter and during the first half of this year continue to be significantly below the first three quarters of last year.
We expect to continue this more detailed report for the next several quarters as we hope we will see the market stabilize. Regular readers of these reports will find the data they are accustomed to receiving in the Annex at the end of this report, along with other statistical data collected for the current period.
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