This is a great analysis and I wish I could afford this service! CB Insights does an outstanding job of analyzing the markets both public and private. Click: http://www.cbinsights.com/blog/trends/capital-efficient-venture-capital-value-creatio this particular analysis is telling in two ways, first it tells us that the market valuation increase versus the amount of equity capital raised in an IPO or M&A exit of over $100MM is 38 to 1! That means the companies that raised $1 in equity at the IPO had an average of a $38 in valuation. Second, not a bad ramp, indicating that maybe the valuation slump really is gone? Who could forget the disastrous decade since the internet bubble burst, followed by the Biotech bubble and then the double whammy of the 2007 RECESSION? Since this bull market started in 2009 (recent opines from Security Analysts who by the way didn’t see it at the time!), the S&P 500 index has gone up 173% or about 34.6% average per year (most of that gain has been in the last couple of years) so the Bull is full on. The 15 companies that were evaluated were mostly internet and social media or social network companies so the data is a little skewed when trying to extrapolate this to the healthcare sector and facts are that there is no equity investment capital to extrapolate to the healthcare market, Drugs, Diagnostics and Devices is still paltry. Steve Burrill Click: http://www.burrillandco.com/ at the recent Moffitt Cancer Center meeting in Tampa, FL commented that only “1 out of 150 life science startups get VC funding”. A really poor funding system and a paltry pool of capital for fueling new life science and helping to create new technologies, lower health care costs and treat diseases in the best market in the world. A second comment by a retired J&J Venture Capital Fund manager is that the VC arm of J&J “…turned down 99% of the business plans.” What’s that say about VC funding, industry funding? I’ve said this several times in meeting Deval Patrick, our esteemed Governor “…there is a better way to fund Biotech.” Can we blame the VC’s? Of course not? 160 characters on a cell phone is much safer company to fund and faster to ROI than funding a multi-hundred million dollar drug development program to treat some obscure disease…Am I being sarcastic? Yes of course!
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