Submitted by The Standard08.26.2008
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This prediction is closed and has been judged.
Prediction judgment on October 22, 2008: The PwC Q3 report shows that this prediction did not occur, which the community correctly predicted. The Q3 investment in Silicon Valley dipped slightly to $2.77 billion. Judged at 0% for not meeting the prediction criteria. -- The Industry Standard
Original prediction: According to the PricewaterhouseCoopers' Moneytree report, $2.955 billion in venture capital flowed into Silicon Valley's various industries in Q2 2008.
Topping the chart were software investments, followed by industrial/energy, and media and entertainment.
Venture capital in the Valley has bumpily recovered since the dot-com fallout from 2001, and not since then have total public investments reached over $3 billion.
Prediction: Will Silicon Valley's Q3 total public venture capital investment top $3 billion for the first time since Q2 2001? In order for this bet to be judged favorably, the PricewaterhouseCoopers' Moneytree Q3 report must show over $3 billion total public investments in Silicon Valley.
The Moneytree Q2 report was announced on July 19, 2008. It is expected that the Q3 report will be issued by approximately October 17, 2008. This prediction will be judged once the report is released to the public.
(Chart: PricewaterhouseCoopers' Moneytree report)
Price History
Prediction Statistics
| Betting Closes: | Oct 17 2008 | Current Consensus: | 18.24% | Total Bets: | 34 |
| Today's Change: | 0% | ||||
| Life Time High: | 53.74% | ||||
| Life Time Low: | 15.45% |
Comments
The growth of VC in the valley is fairly interesting, and even though Software predictably leads the way, I'm betting more and more public VC deals will be made in clean energy. Tesla decided to come to the bay, as well as endless solar and assorted energy startups.
I'm predicting growth again this quarter, but maybe a surprising spike of VC specifically in the clean energy industry.
I am betting against solely on one reason - statistical probablity (ok, and gut feel due to overall deteriorating US economy).
According to Pricewaterhouse data (for Silicon Valley), Q3 investments have historically been generally lower in Q3 relative to Q2 (see below). This could be a seasonal fiscal effect of money flows and general state of economy.
1995-3 -$127,690,800.00
1996-3 -$224,224,400.00
1997-3 $2,209,800.00
1998-3 -$72,174,200.00
1999-3 $973,670,800.00
2000-3 -$790,985,900.00
2001-3 -$1,287,130,100.00
2002-3 -$628,600,100.00
2003-3 -$236,660,400.00
2004-3 -$681,425,000.00
2005-3 $98,774,100.00
2006-3 -$217,809,200.00
2007-3 $192,678,300.00
@Chris - we could make a prediction around that based on the next quarterly Moneytree report. That is, that Clean/Green Tech VC investments will have increased in Q3.
There are signs of declining VC activity ....
http://4entrepreneur.net/?p=713
http://www.usnews.com/articles/business/small-business-entrepreneurs/200...
http://74.125.95.104/search?q=cache:AfeLHIW3cIAJ:www.usfca.edu/sobam/nvc...
http://bits.blogs.nytimes.com/2008/08/28/does-silicon-valley-face-an-inn...
http://news.cnet.com/8300-13860_3-56-0.html?keyword=%22venture+capital%2...
Excerpt from http://blog.socaltech.com/2008/09/02/funding-season-opens-again/
"... the traditional re-opening of the venture capital funding season. VC fundings — which typically tail off in August due to the vacations of many a managing director ..."
" ... lack of quality deals; concern about the economy; worries about lots of “me too” Web 2.0 investments; not to mention lots of time being spent on later round companies, along with a closed IPO window."
"... a steep dropoff in announced venture deals in August of this year (10 deals, versus 33 deals for August of 2007)."
Very interesting, David. I really look forward to seeing the next MT report.
More data to consider .... the current running total for 3Q is at least $435M+.
From http://www.siliconvalleywire.com that tracks activities in Silicon Valley ... here is a summary:
July 9 ($253M+)
trulia $15M
Graspr $2.5M
Sand 9 Inc $8M
Zend $7M
SOMA Networks $51M
TRUSTe $10.5M
Recurrent Energy $75M
Become.com $8M
Sensys $5M
ZYnga $29M
ResponseLogix ???
Kickfire $20M
ngmoco ???
Crescendo Networks $9.5M
Voltaix $12.5M
August ($56.25M+)
SkuceX $15M
TokBox $10M
Amobee ???
EyeFi $11M
Friendster $20M
SkyGrid $11M
ScanCafe $4M
Anthera Pharmaceuticals $19M
Simbol Mining $6.7M
MarketBright ???
Marketo $8M
Turn Inc. $15M
AltaRock Energy $26.25M
DeviceVM $15M
Replay Solution $11M
Webcarzz $4M
September ($125.75M+ so far)
Raptr $12M
Osprey Pharmaceuticals $11M
Aicent ???
BitGravity $11.5M
Sprtgenic $10M
Proteolix $79M
Lookery $2.25M
Adura Systems ???
From http://www.informationweek.com/news/management/roi/showArticle.jhtml;jse...
Over the last five quarters, venture capital investment per quarter has dropped from $7.9 billion to $6.9 billion, said Barry Kramer, one of the Fenwick & West partners who over sees the research that goes into the venture capital barometer. "It's been going down each quarter, but it's not fallen off a cliff," he noted. More troubling is the way that money going into the startup pipeline is now failing to come out the other end.
Even more interesting from your quote, to some degree, is: "More troubling is the way that money going into the startup pipeline is now failing to come out the other end." That's referring to the fact that startups that receive venture funding aren't having any "exits" or IPOs. In Q2, there wasn't a single venture-backed IPO from Silicon Valley - the first time since 1978. I'd be willing to wager that we're going to hear about some venture capital firms shuttering their doors in the next 3-6 months. The money is still out there, but startups are going to find themselves jumping through more and more hoops to receive funding (and really small startups will have to try even harder to get any attention at all).
Financial market are now in a shambles. I doubt that this is the same to the VC market as well as exit strategies become longer or none at all.
Silicon Valley VC Confidence Index downtrend
Reference for Eric's last comment on no exists (http://www.nvca.org/pdf/Q2_08_Exits_Release.pdf and http://www.nvca.org/documents/CapitalMarketsCrisis.ppt)
Not a positive sign. Silicon Valley unemployment at 4yr high
Credit woes begin to have trickle down effects on the VC community.
VC pipeline clogs up as economy stumbles
Q3 VC $ down 33% relative to Q2
Also, higher office vacancy of more than 13% is also a sign negative signs to inflow of VC $
VC confidence continues to drop in Q3
This is done deal. $2.77B for Silicon Valley in Q3 report. As of this comment, the Q3 figures haven't been reflected at the https://www.pwcmoneytree.com/MTPublic/ns/nav.jsp?page=region®ion=2101 yet. This will only be a matter of time as this news is just hot off the press.
Also, from http://www.techcrunch.com/2008/10/18/vc-financings-for-internet-startups..., The MoneyTree Report from PricewaterhouseCoopers and the National Venture Capital Association came out this morning and it shows that total VC financings in the Q3 were down 7 percent compared to Q2.
Other similar articles:
http://www.xconomy.com/boston/2008/10/20/new-englands-top-third-quarter-...
http://odeo.com/episodes/23501861-The-Lights-Are-Still-On-Think-Energy-and-Biotech-Investments-but-the-Party’s-Over-for-Many-U-S-Venture-Deals
The actual report released on October 18, 2008, does not specifically state "Silicon Valley" in the roll-up category which this prediction is relying on.
While I'm certain this will be judged at 0%, I hesitate to throw the switch right now until the site updates itself and we have 100% verification. It sounds like it's going to land somewhere around 2.7 million, but I can't verify the exact figure today. As soon as the site is updated, I'm positive we'll be judging this at 0%.
It does say Silicon Valley which tops with $2.77B followed by New England at $834M.
From http://www.pehub.com/20863/q3-venture-capital-data-the-fall-begins/
Per usual, VCs were most likely to invest in companies based in Silicon Valley. The region received $2.77 billion, compared to just $834 million for New England. LA/Orange County, NY Metro and the Midwest rounded out the top five.
Other URLs provided also made reference to Silicon Valley. Probably a few more days before the actual Pricewaterhouse site gets updated with Q3 metric.
Silicon Valley Q3 VC is $2.773B in 291 companies over 292 deals. Here is the official report from PricewaterhouseCoopers:
http://vx.thomsonib.com/VxComponent/static/stats/2008q3/0MAINMENU.html
http://vx.thomsonib.com/VxComponent/static/stats/2008q3/region_2101.html
and
and
so how come this has not been judged yet? tying up the money for over 4 days when the information has already come out?
Hi Matt,
I've been hesitating on pulling the trigger here on a technicality. "In order for this bet to be judged favorably, the PricewaterhouseCoopers' Moneytree Q3 report must show over $3 billion total public investments in Silicon Valley." If you view the actual PwC report from the Moneytree site that is currently available (the site has yet to be updated), no where does it specifically call out Silicon Valley in the file.
I'm opening up the PwC report that has been made public and doing a search for "Silicon Valley" in the PDF file. I'm going to pull the trigger on this, however, because some of the PwC partners have released their data which seem irrefutable.
Thanks for you patience.
Finally, some spending $ :)
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