2018 was a record year for venture capital deals, with the year seeing 14,889 deals worth a total of $274bn, according to Preqin. This marked a record high for deal value, and the second-highest number of deals ever announced.
This growth was driven by a number of new participants in the deal making space. 2013 saw 4,789 investors involved with at least one funding round; in 2018 this had risen to 10,620. Collectively, these deal makers made 31,317 investments in venture capital-backed companies, almost twice the 17,655 unique financings that were recorded in 2013.
Nevertheless, despite more deal makers entering the venture capital space, the most active deal makers have maintained their dominance of total activity according to the report. In 2018, the 20 most active deal makers accounted for 14% of the total number of deals, on par with the 15% they were involved with in 2013.
The report shows the rising number of active deal makers is partly due to growing participation in Asia. Five years ago, investors in North America accounted for over half of venture capital deal activity, compared to around 10% involving Asia-based investors. In 2018, however, almost three out of 10 deals involved deal makers in Asia.
Richard Stus, head of private capital research at Preqin, said: “The venture capital deal making market is in a period of unprecedented activity, with more deal makers deploying more capital than ever before.
“While the rise in capital totals is partly due to mega funding rounds for multi-billion dollar unicorns, the rise in the number of players is symptomatic of venture capital’s growing importance. Especially in emerging markets, venture capital funding is a valuable part of the SME and startup landscape – as evidenced by the enthusiasm with which China and other emerging economies have embraced the industry in recent years.”