August Top 10s: Venture continues consolidation into fewer, larger deals

Deal count dropped and equity from venture investors into U.S.-based startups rose in August 2018 compared with the same month a year before.

Across all sectors, deal count dropped to 297 in August 2018 from 425 in the same month the year before. Meanwhile, equity invested rose 60 percent to $7.4 billion from $4.6 billion. The numbers exclude a $1 billion private equity round raised by media company NewTV, and a $1 billion debt financing round raised by coworking company WeWork, both in August 2018.

The software sector saw the most deals, with 88 in August 2018 compared with 147 in 2017. Equity invested rose to $2.3 billion, up from $1.3 billion. The sector’s biggest deal was San Francisco-based Slack, which raised $427 million from General Atlantic, Sands Capital Management and Wellington Management Company, according to preliminary data from Thomson Reuters.

The internet ecommerce sector likewise saw a drop in deal count, to 39, from 45 in August 2017, while equity rose to about $750 million, up from $552 million. Those number do not account for the $1 billion in debt financing raised by WeWork from SoftBank in August 2018 and the $4.9 billion the company raised in private equity in August 2017 from SoftBank and Hony Capital.

The biggest venture deal in August 2018 was San Francisco-based food delivery company DoorDash, which raised a $250 million Series E round from Coatue Management and the Mail.Ru Group.

The internet content sector saw 27 deals, down from 37 in August 2017, while equity also dropped to $258.5 million, from $336.8 million. The sector’s biggest deal was Seattle-based online marketplace OfferUp, which raised $39 million from an undisclosed investor.

The human biotech sector reflected the overall venture trend of fewer deals seeing more equity invested. Deal count dropped to 17 from 28, while equity rose to $946.5 million from $549.4. Samumed, a San Diego-based research and development company for tissue-level regeneration, raised $438 million from an undisclosed investor.

Finally, the turnkey integrated systems and solutions sector saw an increase in deal count to 10 from seven and equity rose to $174.1 million from $42.8 million. The sector’s biggest deal was ThinkHR, a cloud-based HR compliance platform based in Pleasanton, California, which raised $67.5 million from Guidepost Growth Equity.

Below are the 10 biggest deals in the five sectors that saw the most venture activity in August 2018.