PricewaterhouseCoopers

National Venture Capital Association

Report*
Data provided by Thomson Financial

Full-year and Q4 2006 US results

The Q4 2006 MoneyTree™ results are in! This special, expanded report—covering 2005
and 2006—provides detailed results of Q4 2006 as well as comprehensive findings for
full-years 2005 and 2006. More detailed results, including historical data, can be found
on the MoneyTree™ Web site at www.pwcmoneytree.com.

Contact
Tracy T. Lefteroff Susan O’Dwyer
tracy.t.lefteroff@us.pwc.com susan.odwyer@us.pwc.com

*connectedthinking
Total equity In 2006, venture capitalists invested $25.5 billion in 3,416 deals, realizing
a 10% increase in deal volume and a 12% increase in dollar value over
Investments in the fourth quarter of 2006 totalled $5.7 billion in 802 deals,
down from $6.6 billion in the third quarter of 2006, but well within the range
investments into 2005. The year, which marked the highest level of investment since 2001, of the $4.3 to $6.9 billion investments seen over the past five years.
venture-backed saw quarterly investment levels remain steady in the $5- to 6-billion dollar
range, as the venture industry invested in the traditional technology and life
companies sciences sectors and began a deliberate foray into the energy sector.

$ in billions

`00 `01 `02 `03 `04 `05 `06

35

30
28.035
26.355
28.421

25
22.176

20

15

11.397
12.847
10
8.094
6.924
8.350 5.993 6.305 6.360
5.577 5.795 5.702 5.722
6.803 4.967
5 4.517 6.252 6.607
5.631
4.817 5.207 4.820 5.075
4.519 4.318

Quarter 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
Number of deals (2,131) (2,105) (1,931) (1,746) (1,289) (1,224) (1,001) (979) (831) (844) (687) (721) (688) (732) (704) (771) (698) (840) (678) (815) (719) (812) (771) (798) (839) (913) (862) (802)

Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
Full-year and Q4 2006 US report © 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
 www.pwcmoneytree.com member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by industry The Life Sciences sector (Biotechnology and Medical Devices industries,
together) set the pace for investing in 2006 with $7.2 billion in 731 deals,
billion, compared to 136 companies in 2005 receiving $851 million. The
alternative energy subsector accounted for 40% of the dollars invested in
compared to $6.0 billion going into 647 deals in 2005. The increase was this category.
2005 to 2006 driven equally by significant increases in the Biotechnology and Medical
Internet-specific companies received $4.0 billion in 645 deals in 2006, a
Devices sectors, both of which had record high levels in 2006. For the year,
notable increase over 2005 when these companies received $3.2 billion in
Life Sciences accounted for 28% of all venture capital invested.
494 deals. Internet-specific companies accounted for 16% of all venture
The Industrial/Energy sector experienced a sharp gain of more than capital dollars in 2006.
107% in dollars invested in 2006 with 183 companies receiving $1.8

($ in millions)
# of All results rounded
deals 0 1,000 2,000 3,000 4,000 5,000 6,000

Software 865 $4,970

869 $,4816

Biotechnology 423 $4,511

376 $3,862

Medical Devices and Equipment 308 $2,654

271 $2,147

Telecommunications 294 $2,612

263 $2,496

Semiconductors 219 $1,986

220 $1,882

Industrial/Energy 183 $1,766

136 $851

Media and Entertainment 299 $1,622

180 $1,052

Networking and Equipment 134 $1,083

169 $1,461

IT Services 152 $1,000

132 $909

Electronics/Instrumentation 89 $681
85 $387

Business Products and Services 116 $653

89 $474

Consumer Products and Services 90 $511

70 $365
2006
Financial Services 74 $424
62 $796
2005

Computers and Peripherals 64 $405

61 $501

Healthcare Services 58 $394

69 $455

Retailing/Distribution 39 $207
42 $252

Other 9 $26
6 $62
($ in millions)
All results rounded
0 7,500 15,000 22,500 30,000

3,416 $25,504
Grand total
3,100 $22,767

Full-year and Q4 2006 US report
 www.pwcmoneytree.com
Definitions of the industry categories can be found on the MoneyTree™ Web site at www.pwcmoneytree.com.
Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
© 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by industry The Life Sciences sector continued to attract the largest amount of
investing for the fourth quarter, garnering nearly $1.8 billion in 178 deals.
year as well as the quarter in terms of both deals and dollars. In the fourth
quarter, the software sector received $1.13 billion in 195 deals.
The investment levels remained relatively steady when compared to the
Q4 2005, Q3 2006, previous quarter and the fourth quarter of 2005 when 185 deals raised $1.9
The industry comparisons for the quarter were fairly consistent with the
exception of the Telecommunications sector, which took a major hit in
and Q4 2006 billion and $1.7 billion was poured into 179 deals, respectively.
investment totals. Telecommunications pulled in only half the dollars as the
While Software investing remained relatively flat for the year 2006—with previous quarter. The sector raised only $469 million in the fourth quarter,
$5.0 billion going into 865 deals (compared to $4.8 billion going into 869 compared to $914 million in the third.
deals in 2005)—the industry still remained the largest single sector for the

($ in millions)
# of All results rounded
deals 0 200 400 600 800 1,000 1,200 1,400
195 $1,128
Software 201 $1,118
212 $1,132
106 $1,099
Biotechnology 103 $1,169
99 $1,006
72 $696
Medical Devices and Equipment 82 $678
80 $666
66 $469
Telecommunications 77 $914
72 $727
50 $420
Semiconductors 60 $503
53 $451
75 $386
Media and Entertainment 83 $450
49 $212
45 $357
Industrial/Energy 53 $624
42 $225
38 $246
IT Services 39 $207
33 $258
31 $230
Consumer Products and Services 20 $41
17 $79
25 $191
Networking and Equipment 30 $275
32 $233
27 $155
Business Products and Services 27 $96
24 $102
15 $112
Healthcare Services 11 $78
20 $145 Q4 06
13 $72
Electronics/Instrumentation 19 $126 Q3 06
21 $109
14 $59 Q4 05
Financial Services 23 $110
16 $133
14 $57
Retailing/Distribution 11 $89
11 $44
10 $33
Computers and Peripherals 22 $127
14 $123
6 $14
Other 1 $4
3 $57
($ in millions)
All results rounded
0 2,000 4,000 6,000 8,000
802 $5,722
Grand total 862 $6,607
798 $5,702

Full-year and Q4 2006 US report
 www.pwcmoneytree.com
Definitions of the industry categories can be found on the MoneyTree™ Web site at www.pwcmoneytree.com.
Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
© 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by stage Funding for Seed and Early stage companies increased by 16% in deals
and 11% in dollars, with $5.0 billion going into 1,176 deals in 2006,
of development compared to the $4.4 billion that went into 1,018 deals in 2005. Seed and
Early stage deals accounted for 34% of the total deals done in 2006.
2005 to 2006
Expansion stage companies saw a significant increase in both deals and
dollars in 2006, with $11.2 billion going into 1,283 deals. This compares
with 2005, when $8.6 billion went into 1,092 deals. The increase reflects
a higher confidence level in companies that reached the Expansion stage.
Expansion deals accounted for 44% of the total deals done in 2006.

($ in millions)
# of All results rounded
deals 0 2,000 4,000 6,000 8,000 10,000 12,000

Expansion 1,283 $11,208

1,092 $8,626

Later 957 $9,313

990 $9,657
2006
Early 864 $3,825
805 $3,688 2005

Startup/Seed 312 $1,159

213 $797
($ in millions)
All results rounded
0 7,500 15,000 22,500 30,000

3,416 $25,504
Grand total
3,100 $22,767

Investments by stage Venture capital investment in Seed and Early stage companies increased
13% in terms of dollars in the fourth quarter of this year, with $1.5 billion
Funding for Expansion stage companies fell 24% in dollars for the fourth
quarter to $2.3 billion after a strong Q3. The number of deals also fell 12%
of development going into 322 deals. The total dollars invested in Seed and Early stage to 285. Investment activity in Later stage companies also declined by 15%
companies in the fourth quarter is the largest amount since the third quarter in dollars and 13% in deals during the fourth quarter of 2006, with 195
Q4 2005, Q3 2006, of 2001, when $1.78 billion was invested. companies capturing $1.9 billion.
and Q4 2006
($ in millions)
# of All results rounded
deals 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000
285 $2,296
Expansion 325 $3,026
288 $2,209 Q4 06
195 $1,908
Later 223 $2,243 Q3 06
257 $2,386
258 $1,232 Q4 05
Early 207 $979
194 $1,002
64 $286
Startup/Seed 107 $359
59 $105
($ in millions)
All results rounded
0 2,000 4,000 6,000 8,000
802 $5,722
Grand total 862 $6,607
798 $5,702

Full-year and Q4 2006 US report
 www.pwcmoneytree.com
Definitions of the stage of development categories can be found on the MoneyTree™ Web site at www.pwcmoneytree.com.
Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
© 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by First-time financings increased in deals and dollars to the highest levels
since 2001, with 1,093 companies receiving $5.8 billion in venture capital for
for $773 million. This follows 2005’s pattern, when 249 Software companies
garnered $1.2 billion.
sequence of financing the first time. This marks an increase of 10% in the number of companies
Seventy percent of first-time financings in 2006 were in the Seed/Early
entering the venture-financed arena.
stage of development, followed by Expansion stage companies at 23% and
2005 to 2006 The top industries for first-time financing growth in 2006 were Software with Later stage companies at 7%.
233 deals valued at $1.2 billion, followed by Biotechnology with 127 deals

($ in millions)
# of All results rounded
deals 0 2,000 4,000 6,000 8,000 10,000 12,000

First 1093 $5,788

991 $5,592

Second & Third 1148 $8,699

1,072 $8,238
2006
Fourth, Fifth, & Sixth 836 $8,586
761 $6,789 2005

Seventh & Beyond 339 $2,432

276 $2,149
($ in millions)
All results rounded
0 7,500 15,000 22,500 30,000

3,416 $25,504
Grand total
3,100 $22,767

Investments by First-time financings remained strong in the fourth quarter of 2006 with 245
deals receiving $1.3 billion. Although levels remained high, they were down
Companies in the Software, Medical Devices and Equipment and
Telecommunications industries attracted the highest level of first-time
sequence of financing 16% when compared to a robust third quarter, and were off by nearly 6% dollars in the fourth quarter. Together, the three industry sectors managed
when comparing them to the same time period last year. to attract nearly 50% of all first-time financing dollars by drawing more than
Q4 2005, Q3 2006, $648 million in the fourth quarter.
and Q4 2006
($ in millions)
# of All results rounded
deals 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000
245 $1,336
First 293 $1,600
276 $1,418 Q4 06
283 $2,008
Second & Third 290 $2,243 Q3 06
260 $2,071
184 $1,802 Q4 05
Fourth, Fifth, & Sixth 198 $2,124
185 $1,650
90 $575
Seventh & Beyond 81 $640
77 $563
($ in millions)
All results rounded
0 2,000 4,000 6,000 8,000
802 $5,722
Grand total 862 $6,607
798 $5,702

Full-year and Q4 2006 US report
 www.pwcmoneytree.com
Definitions of the sequence of financing categories can be found on the MoneyTree™ Web site at www.pwcmoneytree.com.
Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
© 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by region Of the ten regions garnering the largest amount of venture capital dollars in
2006, eight experienced double-digit increases in investment dollars over
LA/Orange County experienced gains of nearly 25% during the same time
period. Taken together, the top three regions—Silicon Valley, New England,
the prior year. Texas saw investment totals jump 28% from 2005, while and NY Metro—accounted for 55% of the total dollars invested in 2006.
2005 to 2006

($ in millions)
# of All results rounded
deals 0 2,000 4,000 6,000 8,000 10,000

Silicon Valley 1108 $9,157

965 $8,115

New England 413 $3,036

404 $2,735

NY Metro 249 $1,945

173 $1,922

LA/Orange County 205 $1,820

179 $1,459

Texas 176 $1,385

161 $1,080

San Diego 125 $1,230

129 $1,055

Southeast 216 $1,212

204 $1,152

Northwest 166 $1,157

161 $1,003

DC/Metroplex 204 $1,125

196 $999

Midwest 160 $978

151 $833

Philadelphia Metro 96 $691

92 $574

Colorado 92 $622
83 $654
2006
SouthWest 76 $468
81 $611
2005

North Central 59 $387

63 $309

Upstate NY 30 $142
29 $59

South Central 17 $77

6 $56

Sacramento/N.Cal 7 $35
14 $77

AK/HI/PR 14 $31
6 $17

Unknown 3 $6
3 $59
($ in millions)
All results rounded
0 7,500 15,000 22,500 30,000

3,416 $25,504
Grand total
3,100 $22,767

Full-year and Q4 2006 US report
 www.pwcmoneytree.com
Definitions of the region categories can be found on the MoneyTree™ Web site at www.pwcmoneytree.com.
Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
© 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by region While there was a slight dip in overall investment activity between the
fourth and third quarters of 2006, the normal “hot spot” regions for venture
compared to an uncharacteristically weak third quarter. Dollars flowing to
Silicon Valley, New England and NY Metro were up a total of 2.4% during
capital investing experienced a minor rebound in financing dollars when the quarter.
Q4 2005, Q3 2006,
and Q4 2006
($ in millions)
# of All results rounded
deals 0 500 1,000 1,500 2,000 2,500
260 $2,159
Silicon Valley 272 $2,212
253 $1,989
96 $695
New England 97 $654
103 $751
56 $550
NY Metro 68 $457
45 $407
39 $380
San Diego 29 $301
34 $268
53 $379
LA/Orange County 59 $551
42 $326
50 $330
Southeast 55 $331
47 $234
41 $279
Northwest 33 $198
43 $311
33 $233
Midwest 43 $159
38 $222
30 $169
Texas 51 $547
46 $310
48 $138
DC/Metroplex 57 $346
55 $214
22 $125
Philadelphia Metro 20 $205
23 $159
18 $93
North Central 17 $143
17 $119 Q4 06
16 $65
Colorado 25 $223 Q3 06
18 $127
19 $50 Q4 05
SouthWest 19 $214
19 $132
6 $36
Upstate NY 8 $35
8 $9
4 $18
South Central 5 $11
2 $43
7 $12
AK/HI/PR 2 $1
1 $10
2 $7
Sacramento/N.Cal 2 $20
2 $14
2 $2
Unknown 0 $0
2 $57
($ in millions)
All results rounded
0 2,000 4,000 6,000 8,000
802 $5,722
Grand total 862 $6,607
798 $5,702

Full-year and Q4 2006 US report
 www.pwcmoneytree.com
Definitions of the region categories can be found on the MoneyTree™ Web site at www.pwcmoneytree.com.
Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
© 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Investments by state The top 10 states in 2006 remained the same as in 2005 with the exception
of North Carolina, which replaced Virginia. These 10 states accounted for
86% of all dollars invested and 81% of the deals done in 2006.
2005 to 2006

($ in millions)
# of All results rounded
deals 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000

California 1,445 $12,242

1,287 $10,706

Massachusetts 368 $2,819

351 $2,498

Texas 176 $1,385

161 $1,080

New York 190 $1,259

126 $1,079

Washington 135 $1,012

124 $814

Pennsylvania 102 $778

81 $474

New Jersey 84 $771

77 $907
2006
Maryland 108 $636
98 $504
2005

Colorado 92 $622
83 $654

North Carolina 65 $472

54 $442

($ in millions)
All results rounded
0 7,500 15,000 22,500 30,000

3,416 $25,504
Grand total
3,100 $22,767

Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
Full-year and Q4 2006 US report © 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
 www.pwcmoneytree.com member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Most active The most active venture firms in the US closed 22 or more deals each in
2006. For the second year in a row, Draper Fisher Jurvetson topped the
Making a big move up the list was Intel Capital, whose 74 deals completed
in 2006 was 57% higher than the 47 deals completed in 2005. For the year,
venture investors list of most active venture firms for the full-year—completing 76 deals in the top 10 firms invested in nearly 18% of all the deals done in 2006.
2006—down slightly from the 80 deals they participated in during 2005.
Full-year 2006
# of # of
Firm Location deals Firm Location deals
Draper Fisher Jurvetson Menlo Park, CA 76 ComVentures Palo Alto, CA 29
Intel Capital Santa Clara, CA 74 Flagship Ventures Cambridge, MA 29
New Enterprise Associates Baltimore, MD 71 3i (US) Waltham, MA 29
Polaris Venture Partners Waltham, MA 63 Warburg Pincus, LLC New York, NY 29
Kleiner Perkins Caufield & Byers Menlo Park, CA 59 Three Arch Partners Portola Valley, CA 29
U.S. Venture Partners Menlo Park, CA 59 Pequot Capital Management, Inc. Westport, CT 29
Sequoia Capital Menlo Park, CA 54 Sanderling Ventures San Mateo, CA 29
Oak Investment Partners Westport, CT 51 Alta Partners San Francisco, CA 28
Venrock Associates New York, NY 50 Carlyle Group, The Washington, DC 27
Austin Ventures, L.P. Austin, TX 46 Mobius Venture Capital Louisville, CO 27
Foundation Capital Menlo Park, CA 45 Maryland DBED Baltimore, MD 27
Highland Capital Partners LLC Lexington, MA 44 Alloy Ventures Palo Alto, CA 27
Village Ventures Williamstown, MA 42 Motorola Ventures Schaumburg, IL 27
Menlo Ventures Menlo Park, CA 41 TL Ventures Wayne, PA 27
Sigma Partners Menlo Park, CA 41 Bay Partners Cupertino, CA 26
Benchmark Capital Menlo Park, CA 41 Sierra Ventures Menlo Park, CA 26
Morgenthaler Ventures Menlo Park, CA 41 SV Life Sciences Advisers Boston, MA 26
Canaan Partners Westport, CT 40 Norwest Venture Partners Palo Alto, CA 26
Versant Ventures Menlo Park, CA 40 Advantage Capital Partners New Orleans, LA 25
InterWest Partners Menlo Park, CA 40 Novak Biddle Venture Partners, L.P. Bethesda, MD 25
Sutter Hill Ventures Palo Alto, CA 40 Columbia Capital LLC Alexandria, VA 25
Accel Partners Palo Alto, CA 39 Ignition Partners Bellevue, WA 25
Tech Coast Angels Laguna Hills, CA 39 Maryland Technology Columbia, MD 25
Redpoint Ventures Menlo Park, CA 36 Development Corporation
Greylock Partners Waltham, MA 35 Scale Venture Partners Foster City, CA 24
Atlas Venture, Ltd. Waltham, MA 34 Omidyar Network Redwood City, CA 24
Band of Angels Menlo Park, CA 34 General Catalyst Partners Cambridge, MA 24
Sevin Rosen Funds Dallas, TX 34 Edison Venture Fund Lawrenceville, NJ 23
Bessemer Venture Partners Larchmont, NY 34 JK&B Capital Chicago, IL 23
ARCH Venture Partners Chicago, IL 33 DCM - Doll Capital Management Menlo Park, CA 23
Frazier Healthcare and Technology Ventures Seattle, WA 33 Goldman, Sachs & Co. New York, NY 22
Advanced Technology Ventures Waltham, MA 32 ONSET Ventures Menlo Park, CA 22
North Bridge Venture Partners Waltham, MA 32 Trinity Ventures Menlo Park, CA 22
Mayfield Fund Menlo Park, CA 31 vSpring Capital Salt Lake City, UT 22
VantagePoint Venture Partners San Bruno, CA 31
Crosslink Capital San Francisco, CA 22
Lightspeed Venture Partners Menlo Park, CA 31
MPM Capital Boston, MA 22
Battery Ventures, L.P. Waltham, MA 30
Prism Venture Partners Westwood, MA 22
Rustic Canyon Partners Santa Monica, CA 30
Oxford Bioscience Partners Boston, MA 22
Enterprise Partners Venture Capital La Jolla, CA 30

Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
Full-year and Q4 2006 US report © 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
10 www.pwcmoneytree.com member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Most active The most active venture firms in the US closed five or more deals each in
the fourth quarter of 2006. U.S. Venture Partners topped the fourth quarter’s
Fisher Jurvetson, Venrock Associates, Village Ventures, Tech Coast Angels
(AKA: TCA), and Kleiner Perkins Caufield & Byers were also among the
venture investors most active list with a total of 17 deals, followed closely by Highland Capital most active investors in the quarter, reporting 14 or more deals each.
Partners, which participated in 16 investments during the quarter. Draper
Q4 2006
# of # of
Firm Location deals Firm Location deals
U.S. Venture Partners Menlo Park, CA 17 Duff Ackerman & Goodrich LLC San Francisco, CA 7
Highland Capital Partners LLC Lexington, MA 16 VantagePoint Venture Partners San Bruno, CA 7
Draper Fisher Jurvetson Menlo Park, CA 15 Three Arch Partners Portola Valley, CA 7
Venrock Associates New York, NY 15 Norwest Venture Partners Palo Alto, CA 7
Village Ventures Williamstown, MA 15 Oak Investment Partners Westport, CT 7
Tech Coast Angels Laguna Hills, CA 15 OVP Venture Partners Kirkland, WA 7
Kleiner Perkins Caufield & Byers Menlo Park, CA 14 InterWest Partners Menlo Park, CA 7
Battery Ventures, L.P. Waltham, MA 13 ComVentures Palo Alto, CA 6
Foundation Capital Menlo Park, CA 13 Khosla Ventures Menlo Park, CA 6
Advantage Capital Partners New Orleans, LA 13 Omidyar Network Redwood City, CA 6
Polaris Venture Partners Waltham, MA 13 First Round Capital West Conshohocken, PA 6
Morgenthaler Ventures Menlo Park, CA 12 Band of Angels Menlo Park, CA 6
New Enterprise Associates Baltimore, MD 12 Crosslink Capital San Francisco, CA 6
Bessemer Venture Partners Larchmont, NY 11 Prism Venture Partners Westwood, MA 6
Canaan Partners Westport, CT 11 Frazier Healthcare and Technology Ventures Seattle, WA 6
Atlas Venture, Ltd. Waltham, MA 10 Matrix Partners Waltham, MA 6
Sequoia Capital Menlo Park, CA 10 Sutter Hill Ventures Palo Alto, CA 6
Flagship Ventures Cambridge, MA 10 Sevin Rosen Funds Dallas, TX 6
Oxford Bioscience Partners Boston, MA 10 SV Life Sciences Advisers Boston, MA 6
Mayfield Fund Menlo Park, CA 10 Sanderling Ventures San Mateo, CA 6
General Catalyst Partners Cambridge, MA 10 Menlo Ventures Menlo Park, CA 6
Lightspeed Venture Partners Menlo Park, CA 9 Greylock Partners Waltham, MA 6
Trident Capital Palo Alto, CA 9 Advanced Technology Ventures Waltham, MA 5
Pequot Capital Management, Inc. Westport, CT 9 Walden International San Francisco, CA 5
Alloy Ventures Palo Alto, CA 9 Aberdare Ventures San Francisco, CA 5
Maryland Technology Development Corp. Columbia, MD 9 Rustic Canyon Partners Santa Monica, CA 5
Benchmark Capital Menlo Park, CA 9 Draper Richards L.P. San Francisco, CA 5
Accel Partners Palo Alto, CA 9 Burrill & Company San Francisco, CA 5
Scale Venture Partners Foster City, CA 8 Aurora Funds, Inc. Durham, NC 5
Versant Ventures Menlo Park, CA 8 Nth Power San Francisco, CA 5
MPM Capital Boston, MA 8 RedShift Ventures Reston, VA 5
North Bridge Venture Partners Waltham, MA 8 Enterprise Partners Venture Capital La Jolla, CA 5
Intel Capital Santa Clara, CA 8 Austin Ventures, L.P. Austin, TX 5
Sierra Ventures Menlo Park, CA 8 Global Catalyst Partners Redwood Shores, CA 5
Edison Venture Fund Lawrenceville, NJ 8 TPG Ventures Menlo Park, CA 5
Carlyle Group, The Washington, DC 7 Trinity Ventures Menlo Park, CA 5
DCM - Doll Capital Management Menlo Park, CA 7 Intersouth Partners Durham, NC 5
Redpoint Ventures Menlo Park, CA 7 ARCH Venture Partners Chicago, IL 5
ATA Ventures Redwood City, CA 7 Sigma Partners Menlo Park, CA 5
Kodiak Venture Partners Waltham, MA 7 3i (US) Waltham, MA 5
Ignition Partners Bellevue, WA 7 Adams Street Partners LLC Chicago, IL 5

Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
Full-year and Q4 2006 US report © 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
11 www.pwcmoneytree.com member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW
Venture-backed merger The number of exits for venture-backed companies in 2006 for both the
IPO and Mergers and Acquisition markets varied only slightly from 2005’s
M&A transactions with a total disclosed value of $16.6 billion. In 2005, by
comparison, 56 companies went public, raising $4.46 billion and there were
and acquisitions exits levels, although these transactions realized higher valuations. The full year 347 M&A transactions with a total disclosed value of $16.1 billion.
2006 saw a total of 58 venture-backed IPOs raise $5.3 billion and 335
2004 to 2006

$ in millions

`04 `05 `06

7

6 5,384.4

5 4,374.8
4,364.9
3,921.0 4,142.8
4,791.0
4 4,514.6 3,679.3

3,747.6 3,801.8
3
2,862.2
2 2,563.7

0
Quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Number of M&As (80) (89) (86) (84) (82) (80) (98) (87) (104) (92) (83) (56)

Venture-backed initial There was a surge in the number of deals as well as money raised in the
fourth quarter, as compared to the third in the venture-backed IPO market.
public offerings Twenty-one companies floated newly issued stock, raising more than $18
billion, a 163% and 96% increase respectively from the previous quarter.
2004 to 2006
$ in millions

4
`04 2,990.4
`05 `06
3
3,225.6
2,077.8
2,721.1 2,011.0
1,835.1
2
1,568.1

1 714.1 1,458.1
934.2
720.7 540.8
0
Quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Number of IPOs (13) (29) (24) (27) (10) (10) (19) (17) (10) (19) (8) (21)

Source: Thomson Financial & National Venture Capital Association Includes all companies with at least one US VC investor that trade on US exchanges, regardless of domicile. Data is current as of January 25, 2007. Data is continuously updated and
is therefore subject to change. Copyright 2007 Thomson Financial. All Rights Reserved.
Full-year and Q4 2006 US report © 2007 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other
12 www.pwcmoneytree.com member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). BS-07-0435.0107.KKW