Venture Pulse Q2 2020: Global Analysis of Venture Funding

Venture
Pulse
Q2 2020
Global analysis of
venture funding
22 July, 2020
© 2020 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 1
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Welcome to the Q2’20 edition of Venture Pulse, KPMG Private
Enterprise’s quarterly report highlighting the key trends, opportunities, and
You know KPMG, you might not
know KPMG Private Enterprise.
challenges facing the venture capital market globally and in major regions
around the world. KPMG Private Enterprise advisers in
member firms around the world are
Q2’20 saw regions across the globe continuing to grapple with the dedicated to working with you and
challenges associated with COVID-19, including economic turbulence, your business, no matter where you
sudden spikes in unemployment rates, restrictions on travel and are in your growth journey — whether
movement, and the ramifications of the continued shutdown or slowdown you’re looking to reach new heights,
of many sectors and industries. As countries and territories began to embrace technology, plan for an exit,
re-open their economies during Q2’20, both Venture Capital (VC) or manage the transition of wealth or
investors and startups worked to understand the ‘new reality’ and how it your business to the next generation.
would affect business operations.
Venture Capital investment continued to show some resilience compared

to broader economic trends, particularly in the US and Europe. In the US,
autonomous driving company Waymo raised a massive $3 billion in the
largest VC deal of the quarter. Fintech investment was particularly hot in
the US during Q2’20, with Stripe, Samsara, Palantir Technologies and
Indigo (Horticulture) all raising large deals. In Europe, sectors seen as
high potential despite or because of COVID-19 attracted significant
investors attention, including food delivery, fintech and health and biotech.
VC investment in Asia remained relatively soft in Q2’20, despite $1 billion
raises by China-based Didi Bike and MGI Tech.
Over the next quarter, many VC investors are expected to remain highly
focused on their own portfolio companies, assessing whether they can
thrive in the new reality and providing follow-on funding for companies that
have had to delay their exit plans. While early-stage companies globally
will likely continue to find it difficult to attract funding, companies that
respond to accelerating trends, such as remote working, ecommerce, and
health and biotech, could see an uptick in investment interest. It is also
likely that companies looking for investment will need to demonstrate an Jonathan Lavender
even greater commitment to equality and diversity. Global Head, KPMG Private
Enterprise, KPMG International
In this quarter’s edition of Venture Pulse, we look at these and a number
of other global and regional trends, including: Conor Moore
Global Co-Leader — Emerging
— The impact of travel restrictions on VC investment in key jurisdictions Giants, KPMG Private Enterprise
— The downward pressure on valuations as a result of COVID-19 Partner, KPMG in the US
— The longer-term impact of COVID-19 on consumer and business
behaviors Kevin Smith
— The increasing focus on profitability and cash management Head of KPMG Private Enterprise
in EMA, Global Co-Leader —
We hope you find this edition of Venture Pulse insightful. If you would like Emerging Giants, KPMG Private
to discuss any of the results in more detail, please contact a KPMG Enterprise
adviser in your area. Partner, KPMG in the UK
Throughout this document, “we”, “KPMG”, “KPMG Private Enterprise”, “us” and “our” refer to the network of
independent member firms operating under the KPMG name and affiliated with KPMG International or to
one or more of these firms or to KPMG International. KPMG International provides no client services. No
member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis
third parties, nor does KPMG International have any such authority to obligate or bind any member firm.
Unless otherwise noted, all currencies reflected throughout this document are US Dollar.
services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated.
In Q2‘20 VC-backed
companies in the Asia
region raised
$16.9B
across
1,011 deals
services and is a Swiss entity with which the independent member firms of the KPMG network are affiliated.
Soft VC investment in Asia during Q2’20, yet
cautious optimism for future
VC investment in Asia was severely impacted by Covid-19 in Q1’20 due to its early exposure to Covid-19.
While VC investment in Asia remained suppressed in Q2’20, the VC market did see some early signs of
recovery. In China, for example, both deal volume and VC investment rose slightly compared to Q1’20.
While the pandemic is still having a major impact in jurisdictions such as India, the increasing focus on
recovery in others is creating cautious optimism in the overarching Asia market heading into Q3’20.
Digital business models attracting significant attention

Despite VC investment in many sectors remaining suppressed in Q2’20, several sectors continued to thrive
due to their applicability in the current business environment. Digital platform businesses focused on meeting
consumer needs, such as edtech, home delivery, and online gaming, remained very attractive, in addition to
healthtechs. With the employees of many corporations in Asia working from home, B2B digital solutions
enabling employees to work remotely also attracted substantial investor attention.
Corporates looking for potential opportunities

At mid-year, corporate VC investment was only slightly off the pace set last year, a sign that corporates
remain confident in opportunities in the Asia region. In China, the large platform companies began to
resume investment activity in April. These and other large corporate investors in Asia are looking to see
what companies have the agility, versatility, and strong management needed to survive. They are also
looking for opportunities to make investments given the downward pressure on valuations.
Cybersecurity, AI, and data analytics remain hot in Asia

Given the rise in digital business models due to the pandemic, digital payments, e-commerce, and
cybersecurity continued to be hot areas of investment. VC investors were also interested in AI, data analytics,
and cybersecurity solutions able to assist with monitoring the spread of COVID-19 and with tracking, tracing,
and isolating individuals. China’s central government was a key driving force behind leveraging technology to
support track and trace models due to the sensitive personal information being collected.
VC investors focusing on existing portfolios, putting early-stage companies at higher risk

Given the heightened levels of uncertainty, VC investors in Asia continued to focus heavily on the needs
of their existing portfolio companies, primarily late-stage companies, in order to ensure they would be
able to weather the effects of COVID-19 rather than on making investments in new startups. This drove
increasing concern for smaller companies without the cash reserves or liquidity to survive the protracted
decline in demand. The focus on late-stage companies could drive consolidation in maturing sectors as
smaller competitors lose market share to their nimble, better capitalized competitors.
The early-stage companies in Asia able to attract investments in Q2’20 typically showed very strong
paths to profitability. Investors in Asia are only growing increasingly wary of companies with high burn
rates, preferring more efficient companies with a focus on profitability.
Soft VC investment in Asia during Q2’20, yet
cautious optimism for future, cont’d.
VC investors in China taking very cautious approach
China accounted for the five largest deals in Asia during Q2’20, including $1 billion raises by biotech
MGI Tech and Didi Bike, a $$750 million raise by edtech Zuoyebang, a $500 million raise by Didi
Autonomous Driving, and a $400 million raise by produce delivery company Xingsheng Selected.
Growing investor confidence in China’s economic recovery, combined with ongoing international travel
restrictions and concerns related to US-China trade relations, led many VC investors in China to focus
on domestic investment in Q2’20. VC investors in China — including traditional VC investors, private
equity firms, and family offices — are starting to look for opportunities to invest due to the unexpected
downward pressure on valuations. Given the significant amount of dry powder in the VC market, VC
investment in China could rise heading into Q3’20.
India sees ongoing interest from investors despite Q2’20 dip in VC investment
After outperforming China in terms of VC investment in fintech in Q1’20,1 fintech continued to be the
strongest area of focus for VC investors in India in Q2’20, led by the $397 million raise by lending
company Navi Technologies. Despite the slowdown in VC funding, India remains a key market for
investors. In April, Facebook announced a massive $5.7 billion equity investment in Reliance Jio, India’s
largest telecom operator.2 During Q2’20, Reliance Jio launched both JioMart3 a direct
e-commerce platform and a JioMart Whatsapp-based platform.4 The ongoing interest in India is
expected to help keep VC deals occurring in the country, if at a slower rate. While Q3 results may also
be soft, investment is expected to rebound by the end of 2020.
Hong Kong Stock Exchange continues to attract secondary listings

Despite the impact and ongoing uncertainty related to COVID-19, the Hong Kong Stock Exchange saw solid
performance during Q2’20, attracting two secondary listings from large Chinese companies JD.com and
NetEase. NetEase raised $2.7 billion from its listing, with shares gaining 8 percent on their first day of trading.
JD.com, meanwhile, raised almost $4 billion, with its shares gaining 5 percent on the first day.5
In Q2’20, the Nasdaq issued a delisting notice to China-based Luckin Coffee following a massive fraud
uncovered by the company,6 which has intensified the push for stronger investor protections and
changes by the SEC. This, combined with an increasing focus on domestic opportunities, other tensions
and trade disputes with the US, and a fairly strong domestic IPO market could encourage China-based
companies to focus their sights on domestic IPOs over the near-term.
Trends to watch for in Asia

Despite short-term challenges, the outlook for the VC market in Asia remains relatively optimistic as the
region continues with its recovery from COVID-19. There will likely be continued downward pressure on
valuations over the next quarter, however, along with increasing consolidation in sectors particularly
hard hit by the economic downturn caused by the pandemic.
In China, there continues to be concern regarding the ongoing trade dispute with the US, which could
affect investment. VC investors in China will likely remain very interested in areas like 5G, smart cities,
IoT, and health care innovation. VC investment in India is expected to remain muted in Q3’20, with the
exception of fintech, healthtech, agritech, and gaming.
1 https://www.scmp.com/tech/venture-capital/article/3086117/india-tops-china-fintech-funding-first-quarter-pandemic-us
2 https://techcrunch.com/2020/04/21/facebook-reliance-jio/
3 https://thetechportal.com/2020/05/24/reliance-jio-jiomart-ecommerce-platform-launch/
4 https://thetechportal.com/2020/04/26/jiomart-has-reportedly-gone-live-after-receiving-its-official-whatsapp-number/
5 https://www.bbc.com/news/business-53049177
6 https://fortune.com/2020/05/20/luckin-coffee-stock-delisting-nasdaq-china-ipo/
VC activity evens out
Venture financing in Asia
2013–Q2'20
$60 2,500
$50
2,000
$40
1,500
$30
1,000
$20
500
$10
$0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2013 2014 2015 2016 2017 2018 2019 2020
Deal value ($B) Deal count Angel/Seed Early VC Later VC
Source: Venture Pulse, Q2’20. Global Analysis of Venture Funding, KPMG Private Enterprise. Data provided by PitchBook, 7/22/20. Note:
Refer to the Methodology section on page 22 to understand any possible data discrepancies between this edition and previous editions of
Venture Pulse.
As it was first hit, the Asia-Pacific ecosystem saw the impact of the pandemic on venture activity first of any
region. Thus, activity evening out in both volume and VC invested is a promising sign that at minimum a plateau
may have been established, rather than another dip expected.
“COVID-19’s impact on travel and global supply chains combined with the ongoing political tension
between China and the US is causing many investors to refocus on local market opportunities. This
could lead to an upswell in domestic VC investment over the next quarter.”
Egidio Zarrella
Head of Clients and Innovation Partner
KPMG China
Figures hold largely steady
Median deal size ($M) by stage in Asia
2013–2020*
$15.5
$14.8
$14.3
$12.9 $13.1
$12.5
$12.0
$8.2
$6.0
$4.8 $5.0 $4.7
$4.5 $4.5
$3.5
$2.8
$0.7 $1.0 $1.0 $1.0

$0.4 $0.5 $0.6 $0.5
2013 2014 2015 2016 2017 2018 2019 2020*
Angel/seed Early VC Later VC
Source: Venture Pulse, Q2’20, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of 6/30/20. Data provided by PitchBook, 7/22/20.
The decline in median financing size at the latest stage is minimal, while an increase or plateau elsewhere
continues to show that investors are mainly pressing pause as opposed to retreating. Both VCs and entrepreneurs
are in it for the long haul, and, thus are still moving forward, albeit with more caution.
Late stage predominates
Deal share by series in Asia
2013–2020*, number of closed deals
5,000
4,500 Series D+
4,000
3,500 Series C
3,000
2,500
Series B
2,000
1,500
Series A
1,000
500
Angel/seed
0
2013 2014 2015 2016 2017 2018 2019 2020*
Deal share by series in Asia

2013–2020*, VC invested ($B)
$120
Series D+
$100
Series C
$80
$60
Series B
$40
Series A
$20
Angel/seed
$0
2013 2014 2015 2016 2017 2018 2019 2020*
Biotech roars at record pace
Asia venture financings by sector
2013–2020*, number of closed deals
100%
Commercial
90% Services
Consumer Goods &
80% Recreation
Energy
70%
HC Devices &
60% Supplies
HC Services &
50% Systems
IT Hardware
40%
Media
30%
Other
20%
10% Pharma & Biotech
0% Software
2013
2014
2015
2016
2017
2018
2019
2020
*
Asia venture financings by sector

2013–2020*, VC invested ($B)
100%
Commercial
90% Services
Consumer Goods &
80% Recreation
Energy
70%
HC Devices &
60% Supplies
HC Services &
50% Systems
IT Hardware
40%
Media
30%
Other
20%
10% Pharma & Biotech
0% Software
2020*
2013
2014
2015
2016
2017
2018
2019
Corporates dial back in
Corporate participation in venture deals in Asia
2013–Q2'20
$45 600
$40
500
$35
$30 400
$25
300
$20
$15 200
$10
100
$5
$0 0
2013 2014 2015 2016 2017 2018 2019 2020
Deal value ($B) Deal count
Source: Venture Pulse, Q2’20, Global Analysis of Venture Funding, KPMG Private Enterprise. Data provided by PitchBook, 7/22/20.
Corporations and their venture arms have been a mainstay of the Asia venture ecosystem for years, their
temporary dip proved to be just that, as they engaged in far more deals in Q2 than to start off the year. This is a
highly positive sign for the entire ecosystem.
Exits stil in temporary slump
Venture-backed exit activity in Asia
2013–Q2'20
$160 120
$140
100
$120
80
$100
$80 60
$60
40
$40
20
$20
$0 0
2013 2014 2015 2016 2017 2018 2019 2020
Exit value ($B) Exit count
Exits slid in volume but, relative to historical norms, still recorded a robust tally of exit value in Q1 2020. Another
quarter-over-quarter decline still isn’t sustained long enough to prove dire for the regional ecosystem, but it is
worth keeping an eye on for potential issues with liquidity going forward.
“We have seen very positive activity despite the current situation with several successful IPOs and
secondary listings. The strong momentum and sentiment in Hong Kong SAR and mainland China’s
capital markets in Q2 is expected to continue into the second half of 2020. I expect VC and PE
activities in the region to pick up in the coming quarters as China will not only continue its economic
recovery from the pandemic but focus on investing in new infrastructure to support the digital
transformation of the economy.”
Irene Chu
Partner, Head of New Economy and Life Sciences, Hong Kong Region,
KPMG Hong Kong (SAR)/China
IPOs and M&A power volume
Venture-backed exit activity (#) Venture-backed exit activity ($B) by type
by type in Asia in Asia
2013–2020* 2013–2020*
400 $250
350
$200
300
250
$150
200
$100
150
100
$50
50
0 $0
Strategic Acquisition Buyout IPO Strategic Acquisition Buyout IPO
Select large funds can close
Venture fundraising in Asia
2013–2020*
$35 160
150
140
$30
128 126
122 120
$25
108
100
96
$20
80
$15
62 60
$10
40
29
$5
20
$9.7 $9.5 $26.1 $19.6 $32.3 $22.1 $15.1 $6.3

$0 0
2013 2014 2015 2016 2017 2018 2019 2020*
Capital raised ($B) Fund count
Fundraising is quite choppy on a quarterly basis for even established ecosystems, hence the focus on yearly
charting only. However, volume for the region is off to quite a slow start for the year, even if the handful of vehicles
that have closed have been able to boost VC committed tallies to decent levels. Extant dry powder continues to
propel deal making forward.
First-time funds tick up
Venture fundraising (#) by size in Asia
2013–2020*
100%
Under $50M
90%
80%
$50M-$100M
70%
60%
$100M-$250M
50%
40%
$250M-$500M
30%
20% $500M-$1B
10%
0% $1B+
2013 2014 2015 2016 2017 2018 2019 2020*
First-time vs. follow-on venture funds (#) in Asia

2013–2020*
100%
90%
80%
First-time
70%
60%
50%
40%
30%
20% Follow-on
10%
0%
2013 2014 2015 2016 2017 2018 2019 2020*
India records decline
Venture financing in India
2013–Q2'20
$7,000 400
$6,000 350
300
$5,000
250
$4,000
200
$3,000
150
$2,000
100
$1,000 50
$0 0
2013 2014 2015 2016 2017 2018 2019 2020
Deal value ($M) Deal count
After steadily rising throughout 2019, India saw a record quarter to close off the year. That has since reversed
inevitably given the impact of the pandemic. It remains to be seen how long the slump will persist, or even its
true depth, although deals are still able to get done if need be, as evidenced by the mega-round of Navi
Technologies in Q2 2020.
“India is a very attractive market for VC investors. While funding is likely going to be muted again in
Q3’20 due to the impact of COVID-19, investment is expected to pick up again by the end of the
year. Fintech remains one of India’s most attractive sectors for investment, in addition to healthtech,
medtech, and gaming. Over the longer-term, agritech is well-positioned to see increasing
investment as well.”
Nitish Poddar
Partner and National Leader, Private Equity
KPMG in India
China sees slight resurgence
Venture financing in China
2013–Q2'20
$60 1,600
1,400
$50
1,200
$40
1,000
$30 800
600
$20
400
$10
200
$0 0
2013 2014 2015 2016 2017 2018 2019 2020
Deal value ($B) Deal count

The first nation hit by the pandemic, China also may now be the first nation to lead the way toward a recovery,
however gradual. Venture funding followed a similar path, with VC invested and volume both rebounding in Q2 to
still-low but somewhat brighter levels.
"Digital business models were a hot area of investment in China during Q2'20 — particularly in
areas of digital payments, e-commerce, remote office solutions, cybersecurity, digital health, and
track-and-trace solutions for managing disease spread. These sectors will likely remain attractive
for VC investors heading into Q3'20 — with digital health innovation expected to be a long term
investment trend given the increasing challenges in the space.”
Philip Ng
Partner, Head of Technology
KPMG China
Australia holds steady
Venture financing in Australia
2013–Q2'20
$600 90
80
$500
70
$400 60
50
$300
40
$200 30
20
$100
10
$0 0
2013 2014 2015 2016 2017 2018 2019 2020
Deal value ($M) Deal count
The pandemic undoubtedly contributed to the slide in volume between Q1 and Q2 2020 for Australia, and yet
the robustness of VC invested implies that this downturn may yet be temporary depending on how the
economic fallout may fully impact the nation although, again, it is worth noting many of VC’s favored sectors
are somewhat more insulated from the immediate effects of any policies such as stay-home orders.
A diverse array of sectors
38
14
5 10
71
6
Top 10 financings in Q2'20 in Asia-Pacific
MGI Tech — $1B, Shenzhen Navi Technologies — $397.9M, Bengaluru

1 Biotechnology 6 Fintech
Series B Angel
Didi Bike — $1B, Hangzhou Royole — $300M, Shenzhen

1 Application software
7 Electronics (B2C)
Early-stage VC Series F
Zuoyebang — $750M, Beijing Eswin — $281M, Beijing

3 Edtech
8 Semiconductors
Series E Series B
Didi Autonomous Driving — $500M,
Ninja Van — $279M, Singapore
4 Shanghai
9 Logistics
Automotive
Series D
Early-stage VC
Xingsheng Selected — $400M, Changsha Mabwell — $278.4M, Shanghai
5 Internet retail
10 Biotechnology
Early-stage VC Series A
KPMG Private Enterprise Emerging Giants
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Contact us:
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Co-Leader, KPMG Private Enterprise Co-Leader, KPMG Private Enterprise
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About KPMG Private Enterprise
About KPMG Private Enterprise
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Acknowledgements
We acknowledge the contribution of the following individuals who assisted in the
development of this publication:
Jonathan Lavender, Global Head, KPMG Private Enterprise, KPMG International
Conor Moore, Global Co-Leader — Emerging Giants, KPMG Private Enterprise, Partner, KPMG in the US
Kevin Smith, Head of KPMG Private Enterprise in EMA, Global Co-Leader — Emerging Giants, KPMG
Private Enterprise, KPMG International, Partner, KPMG in the UK
Anna Scally, Partner, Head of Technology and Media and Fintech Lead, KPMG in Ireland
Dr. Ashkan Kalantary, Partner, Deal Advisory Venture, KPMG in Germany Services
Dina Pasca-Raz, Partner, KPMG in Israel
Egidio Zarrella, Head of Clients and Innovation Partner, KPMG China
Irene Chu, Head of New Economy and Life Sciences, KPMG Hong Kong (SAR)/China
Lindsay Hull, Director — Emerging Giants Global Network, KPMG Private Enterprise, KPMG International
Melany Eli, Director, Marketing and Communications, KPMG Private Enterprise, KPMG International
Nitish Poddar, Partner and National Leader, Private Equity, KPMG in India
Philip Ng, Partner, Head of Technology, KPMG China
Sunil Mistry, Partner, KPMG Private Enterprise, Technology, Media and Telecommunications, KPMG in
Canada
Tim Dümichen, Partner, KPMG in Germany
Tim Kay, Director, KPMG in the UK
Methodology
KPMG uses PitchBook as the provider of venture data for the Venture Pulse report.
Please note that the MESA and Africa regions are NOT broken out in this report. Accordingly, if you add up
the Americas, Asia-Pacific and Europe regional totals, they will not match the global total, as the global
total considers those other regions. Those specific regions were not highlighted in this report due to a
paucity of datasets and verifiable trends.
In addition, particularly within the European region, the Venture Pulse does not contain any transactions
that are tracked as private equity growth by PitchBook. As such rounds are often conflated with late-stage
venture capital in media coverage, there can be confusion regarding specific rounds of financing. The key
difference is that PitchBook defines a PE growth round as a financial investment occurring when a PE
investor acquires a minority stake in a privately held corporation. Thus, if the investor is classified as PE by
PitchBook, and it is the sole participant in the recipient company’s financing, then such a round will usually
be classified as PE growth, and not included in the Venture Pulse datasets.
Also, if a company is tagged with any PitchBook vertical, excepting manufacturing and infrastructure, it is
kept. Otherwise, the following industries are excluded from growth equity financing calculations: buildings
and property, thrifts and mortgage finance, real estate investment trusts, and oil & gas equipment, utilities,
exploration, production and refining. Lastly, the company in question must not have had an M&A event,
buyout, or IPO completed prior to the round in question.
Fundraising
PitchBook defines venture capital funds as pools of capital raised for the purpose of investing in the equity of
startup companies. In addition to funds raised by traditional venture capital firms, PitchBook also includes
funds raised by any institution with the primary intent stated above. Funds identified as growth-stage vehicles
are classified as PE funds and are not included in this report. A fund’s location is determined by the country in
which the fund is domiciled, if that information is not explicitly known, the HQ country of the fund’s general
partner is used. Only funds based in the US that have held their final close are included in the fundraising
numbers. The entirety of a fund’s committed capital is attributed to the year of the final close of the fund.
Interim close amounts are not recorded in the year of the interim close.
Deals
PitchBook includes equity investments into startup companies from an outside source. Investment does
not necessarily have to be taken from an institutional investor. This can include investment from individual
angel investors, angel groups, seed funds, venture capital firms, corporate venture firms and corporate
investors. Investments received as part of an accelerator program are not included, however, if the
accelerator continues to invest in follow-on rounds, those further financings are included. All financings are
of companies headquartered in the US. The impact of initial coin offerings on early-stage venture financing
as of yet remains indefinite. Furthermore, as classification and characterization of ICOs, particularly given
their security concerns, remains crucial to render accurately, we have not detailed such activity in this
publication until a sufficiently robust methodology and underlying store of datasets have been reached.
Angel/seed: PitchBook defines financings as angel rounds if there are no PE or VC firms involved in the
company to date and it cannot determine if any PE or VC firms are participating. In addition, if there is a
press release that states the round is an angel round, it is classified as such. If angels are the only
investors, then a round is only marked as seed if it is explicitly stated.
Methodology, cont’d.
Early-stage: Rounds are generally classified as Series A or B (which PitchBook typically aggregates
together as early-stage) either by the series of stock issued in the financing or, if that information is
unavailable, by a series of factors including: the age of the company, prior financing history, company
status, participating investors and more.
Late-stage: Rounds are generally classified as Series C or D or later (which PitchBook typically
aggregates together as late-stage) either by the series of stock issued in the financing or, if that
information is unavailable, by a series of factors including: the age of the company, prior financing history,
company status, participating investors, and more.
Corporate: Corporate rounds of funding for currently venture-backed startups that meet the criteria for
other PitchBook venture financings are included in the Venture Pulse as of March 2018.
Corporate venture capital: Financings classified as corporate venture capital include rounds that saw both
firms investing via established CVC arms or corporations making equity investments off balance sheets or
whatever other non-CVC method actually employed.
Exits
PitchBook includes the first majority liquidity event for holders of equity securities of venture-backed
companies. This includes events where there is a public market for the shares (IPO) or the acquisition of
the majority of the equity by another entity (corporate or financial acquisition). This does not include
secondary sales, further sales after the initial liquidity event, or bankruptcies. M&A value is based on
reported or disclosed figures, with no estimation used to assess the value of transactions for which the
actual deal size is unknown.
In the edition of the KPMG Venture Pulse covering Q1 2019, PitchBook’s methodology regarding
aggregate exit values changed. Instead of utilizing the size of an IPO as the exit value, instead the
prevaluation of an IPO, based upon ordinary shares outstanding, was utilized. This has led to a significant
change in aggregate exit values since, yet is more reflective of how the industry views the true size of an
exit via public markets.
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Venture Pulse Q2 2020: Global Analysis of Venture Funding

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Venture Pulse Q2 2020: Global Analysis of Venture Funding

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Venture

Venture Capital investment continued to show some resilience compared

Digital business models attracting significant attention

Corporates looking for potential opportunities

Cybersecurity, AI, and data analytics remain hot in Asia

VC investors focusing on existing portfolios, putting early-stage companies at higher risk

Hong Kong Stock Exchange continues to attract secondary listings

Trends to watch for in Asia

$0.7 $1.0 $1.0 $1.0

Angel/seed Early VC Later VC

Deal share by series in Asia

10% Pharma & Biotech

Asia venture financings by sector

10% Pharma & Biotech

Exit value ($B) Exit count

Strategic Acquisition Buyout IPO Strategic Acquisition Buyout IPO

$9.7 $9.5 $26.1 $19.6 $32.3 $22.1 $15.1 $6.3

Capital raised ($B) Fund count

First-time vs. follow-on venture funds (#) in Asia

Deal value ($B) Deal count

Top 10 financings in Q2'20 in Asia-Pacific

MGI Tech — $1B, Shenzhen Navi Technologies — $397.9M, Bengaluru

Didi Bike — $1B, Hangzhou Royole — $300M, Shenzhen

Zuoyebang — $750M, Beijing Eswin — $281M, Beijing

Conor Moore Kevin Smith

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