Completed transaction volume continues a gentle slide as VC invested comes roaring back Worldwide VC deal count slid again by just over 7% between Q1 and Q2'17. However, thanks to a surge of mega-rounds, the quarter-over-quarter increase in total venture capital invested was a staggering 55.3%. This included the largest venture round ever, raised by Beijing-based ridesharing platform Didi Chuxing, at $5.5 billion. Analyzing year-over-year figures, even the massive $40 billion invested in Q2'17 was down by 14.2% relative to the $46.7 billion invested in Q2 2016, while deal volume fell by 24% across the same timeframe. Activity across the Americas varies Buoyed by the US, the Americas have seen deal volume hold relatively steady over the past three quarters now, as additional datasets have been tabulated. There was a bare increase of 0.1% in activity between Q1 2017 and Q2'17, even as total VC invested surged by close to 38%. Year over year, however, both VC invested and volume were down, the former by 4.2% and the latter by 10.5%. Even in nations experiencing consistent declines in venture volume, certain companies can rake in heftily sized rounds, such as Brazil-based 99Taxis, which closed out a $200 million funding with SoftBank’s participation. Valuations remain steadfast as volume continues at subdued plateau Nearly every financing series still records an increase in median size relative to 2016 in the US. This continued robustness speaks to how the VC slowdown in the most developed venture market was once again confined largely to the angel and/or seed stages in the US, which are now holding steady in terms of finalized transactional volume. Likely driven by industry cyclicality, there could be a temporary plateau of sorts emerging when it comes to overall US investment volume, with hefty levels of dry powder continuing to exert upward pressure on financing metrics. The European angel & seed stage is still subsiding, however Quarter over quarter, aggregate VC invested actually rose slightly in Europe, moving from $4 billion to $4.1 billion, even as quarterly volume diminished by just over 44% year over year. Unlike the US, subsiding angel and seed rounds are the primary cause for the continued slackening in the pace of investors. But as the historically robust tallies of quarterly VC invested testify, plenty of firms are still willing to back multiple European companies, particularly when it comes to the late-stage. A handful of notable financings, such as London-based Improbable’s $502 million raise or Auto1 Group’s near-$400 million round, continue to help boost overall industry tallies in the continent. After slower start, Asia sees massive boom in VC invested It is hard to overstate just how swiftly the tide turned when it comes to aggregate VC invested in Asia. Boosted in large part by several Beijing-based businesses’ considerable fundraises, overall capital deployed by investors in the region soared from $5.4 billion in Q1 2017 to $12.7 billion in Q2'17, an increase of over 130%. That said, it is important to note just how much outliers still contribute to such figures — the year-over-year change in VC invested for the quarter was actually down by 33.7%, given that Ant Financial among other companies raised massive rounds around this time last year. Within certain markets, a distinct sense of winner-take-all is emerging, as Didi Chuxing or others either double down on funds to continue rapid, massive expansion or to quickly claim the lead in select market segments. All currency amounts are in USD, unless otherwise specified, data provided by PitchBook. © 2017 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated. #Q2VC