The question here is simple – which financial firms have the largest exposure to unicorn companies?  Take a guess, because the answer follows shortly.  But, before getting into the list, a review of the top unicorn companies follows.

The List of Unicorns

First, what is a unicorn?  A unicorn is a company with a private value of at least $1 billion.  These are some of the world’s most well-known companies, as well as companies you’ve probably never heard of.  Here’s the list.

On top of the list is Uber Technolgies, with the amount of venture capital raised in the past 18 months at over $6.6 billion.  Uber is followed by WeWork, which has raised about $1.8 billion over the past 18 months.

Other highly valued private companies that have raised lots of cash over the past year-and-a-half include according to Pitchbook’s most recent venture capital report include (amount raised over the past 18 months in parentheses) Airbnb ($1.0 billion), Pivotal Software ($653 million), Outcome Health ($610 million), Lyft ($600 million), Unity ($581 million), Wish ($500 million), Intarcia Therapeutics ($476 million), Moderna ($474 million), Domo ($473 million), SoFi ($453 million), Instacart ($449 million), Oscar ($400 million) and Houzz ($400 million).  The list gets quite large when considering companies that have raised less than $400 million in the past 18 months.

the companies Source: Pitchbook

How many unicorns are there?  According the the private equity data aggregator Pitchbook, the number of unicorn companies has exploded in recent years, going from 1 in 2004 to 128 as of August 11, 2017.  Interestingly, growth has tapered off recently, with only 7 new unicorns in 2017.  In 2016, the world saw 10 companies enter the unicorn realm.

unicorngrowth Source: Pitchbook

The Investment Firms Backing the Most Unicorns

Now the question at hand – which firms have backed the most unicorns?  Take your guess, because the answer follows.

Interestingly, the top backer of private companies with a valuation of $1 billion or more is Fidelity.  Fidelity owns a stake in 34 unicorn companies.

The list of firms with investments in at least 20 unicorn companies includes (number of unicorn companies in which a firm has a investment in parentheses) Sequoia Capital (30), Andreessen Horrowitz (30), SV Angel (29), T. Rowe Price (27), Kleiner Perkins Caufield & Byers (27), GV (23), The Goldman Sachs Group (22), New Enterprise Associates (22), IVP (22), SharesPost (21), Tiger Global Management (21), Wellington Management (21), and Khosla Ventures (21).

The list gets much larger when considering all the firms with a stake in at least 1 unicorn company.

investors Source: Pitchbook

Conclusion

In a review of Pitchbook’s most recent unicorn report, some interesting findings emerge.  Among the most intriguing is the list of companies that back the most unicorns.  Interestingly, the top 6 backers include Fidelity at 34, Sequoia Capital at 30, Andreessen Horowitz at 30, SV Angel at 29, T. Rowe Price at 27, and Kleiner Perkins Caufield & Buyers at 27.  Must be a good time to be a financial backer of some of the world’s most valuable companies.

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Every now and then, we like to take a look at Pitchbook’s league tables.  Before taking a look, which entity would you guess is the most active, when measured by deal count?  Which deals were the most significant in the second quarter of 2017?  Which U.S.-based private equity funds raised the most capital in the second quarter?  Which companies saw large private equity exits in the second quarter?  Here’s a look.

Most Active Investors by Deal Count

First, which firms were the most active in the second quarter of 2017?  Interestingly, Audax Group and HarbourVest Partners came in on top at 16 deals.  Following the lead of Audax Group and HarbourVest Partners, the remaining four members (two firms tied at 9 to round out the top 5) of the top 5 most active include Genstar Capital at 10, Kohlberg Kravis Roberts at 10, BC Partners at 9, and Stone Point Capital at 9.

The other members of the top 10 include AlpInvest Partners at 8, Providence Equity Partners at 8, Warburg Pincus at 8, American Securities at 7, New Mountain Capital at 7, and Summit Partners at 7.

The list gets fairly large when expanding to firms that made 6 or fewer deals.

pic1 Source: Pitchbook

 

Select U.S. Private Equity Deals in 2Q 2017

Switching to significant private equity deals in the second quarter of 2017, here’s a look at Pitchbook’s top 5.  Before looking, which deals do you think show up on the list?  Interestingly, Air Methods shows up on top at $2.5 million, led by American Securities.  The other members include USI Insurance Services (Kohlberg Kravis Roberts/La Caisse) at $2.48 billion, Truck Hero (CCMP Capital Advisors) at $1.5 billion, Intel Security (TPG, Thoma Bravo) at $1.1 billion, and PRO  Unlimited (Harvest Partners/Investcorp) at $780 million.

pic2 Source: Pitchbook

 

Select U.S. Private Equity Funds in 2Q 2017

Shifting to the private equity funds raising significant amounts of funds in the second quarter of 2017, Pitchbook reports Silver Lake Partners V at $15 billion as on top.  The other notable firms on the list include Vista Equity Partners at $11 billion, Clayton, Dubilier & Rice Fund X at $10 billion, Summit Partners Growth Equity Fund X at $3.3 billion, and GoldPoint Mezzanine Partners IV at $1.3 billion.  Judging by the amount of money raised by the private equity industry beyond just these five, one could confidently say that the private equity universe is doing just fine – and appears to continue to have a bright future.

pic3 Source: Pitchbook

 

Select U.S. Private Equity Exits in 2Q 2017

Lastly, shifting to notable private equity exits in the second quarter of 2017, Pitchbook places Tyson Foods’ purchase of AdvancePierre Foods for $3.2 billion as the most notable deals.  The other four members of the top 5 notable deals include Kohlberg Dravis Roberts and Stone Point Capital’s $2 billion purchase of Focus Financial Partners at $2 billion, McKesson’s $1.4 billion purchase of CoverMyMeds, Loews $1.2 billion purchase of Consolidated Container Company, and Darden Restaurants’ purchase of Cheddar’s Scratch Kitchen for $780 million.

pic4 Source: Pitchbook

Conclusion

Overall, the private equity universe appears healthy, and headed for a reasonably strong end to 2017.

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CB Insights, the financial data tracking firm, recently put out a list of a new US-based companies on the “unicorn” startup list (a unicorn is a privately-held company with a valuation of at least $1 billion).  Who’s on it?

Just a Little Background

Before getting into the list of companies with newly minted valuations of over $1 billion, some background seems useful.  In the prior quarter, the startup universe welcomed another 9 companies to the unicorn world, the highest quarterly total since the third quarter of 2015.

Interestingly, although the typical point at which a company reaches a $1 billion valuation is in later stage funding rounds, 3 of this quarter’s 12 companies earned their $1 billion-plus valuation at mid-stage funding rounds.

Additionally, 8 of the 12 companies saw funding raises of over $100 million, while 3 of the companies landed on the unicorn list with raises under $100 million, including Quora, Rocket Lab, and Symphony.

The List

#1 Outcome Health

First on the list is Outcome Health, with a massive valuation of $5.5 billion.  The company provides education content and interactive health assessments through tablets, in-office video screens, custom applications, and various other medium.  Not bad for co-founders Rishi Shah and Shadha Agarwal.

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#2 Quora

Second on the list is a hub for online discussion, which allows users to post questions and give analysis and opinions on posed question.  Perhaps fascinating, given the perceived simple nature of the business model, Quora came in with a valuation of $1.8 billion, a nice chunk of change for co-founder and CEO Adam D’Angelo.

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#3 Avidxchange

Third on the list is is the first fintech startup – Avidxchange.  Avidxchange came in with a valuation of $1.4 billion, a healthy amount of value for a company that automates invoicing and payment processing for midsize companies.

Perhaps the most interesting aspect of the funding round was that Canadian pension-plan investor CDPQ funded a third of Avidxchange’s recent $300 million round.

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#4 C3 IOT

Fourth on the list is the first internet-of-things company, C3 IOT.  The company offers a platform for design, development, and operation of enterprise-scale big data, predictive analytics, artificial intelligence, and internet-of-things applications.  The amount of the round was undisclosed, but the valuation came in at $1.4 billion.

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#5 Robinhood

Rounding out the top 5 is Robinhood, with a valuation of about $1.3 billion.  The company has a novel idea, allowing users to trade stocks without paying commission.

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#6 – #12

The remaining 7 members of this quarter’s “group of 12″ unicorns includes Rubrik, Peleton, Clover Health, Crowdstrike, Rocket Lab, Katerra, and Symphony.

Conclusion

Overall, valuation continue the upward climb.  In CB Insight’s most recent accounting of newly minted unicorn startups, the list includes 12 more companies, ranging from healthcare to cloud banking.  It’s a good day to be an owner of a super-successful startup.

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A Look at the Private Equity Fund Manager Outlook

August 7, 2017

Every half of the year Preqin, the private equity and venture capital research group, does a “Private Equity Fund Manager Outlook”.  They’re out with their second half of 2017 picture.  Here’s a look at what private equity fund mangers think on deal flow and competition, investor appetite, and outlook and future plans. Deal Flow and […]

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Where Are 2017 Private Equity-Backed Deals Heading?

July 25, 2017

We’re a little over half way through 2017, and so far it’s been as an interesting year as expected.  We’ve seen equity markets explode through the roof, home prices continuing to rise, a seemingly never ending investigation into potential Russian meddling in the 2016 Presidential election, rumors of war with North Korea, and a host […]

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Private Equity in Europe

July 10, 2017

Europe is known for a lot of things – good food, amazing vacation locations, obsessive regulations, slow economic growth, densely packed housing, and a host of others. Finance is also something Europe generally does well.  This led us to wonder which European country  has the largest private equity investments as a percentage of Gross Domestic […]

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How Might Pending Federal Reserve Rate Hikes Affect Venture Capital?

June 26, 2017

This past week the Fed announced another quarter point rate hike.  The Federal Funds target rate will soon range from 1% to 1.25%, a full 1% higher than the when the Fed began its so-called “tightening” cycle in December 2015. Question: How might the upcoming Fed tightening moves affect the venture capital markets?  Here’s some […]

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The Jobs Report Stunk. What Does the Financial Jobs Picture Portend for the Latter Half of 2017?

June 12, 2017

Friday’s jobs report could aptly be described as a stinker.  Month-over-month employment growth came in at +138K, a fair bit below analysts’ expectations.  Early month’s growth figures for 2017 were also revised lower, to +50K for March and +174K for April.  The May results beg the question – is the economy header for a recession, […]

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Who’s #1? Looking at the Global League Tables

May 17, 2017

We always find it interesting to see which private equity and venture capital firms are on top of Pitchbook’s Global League Tables.  Here’s a look. Private Equity Firms The U.S. Before looking, which private equity firms would you guess would be on top in the first quarter of 2017?  The firms on top of the […]

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Looking at the State of Venture Capital in 2017 So Far

May 2, 2017

Pitchbook, the private equity and venture capital data collection firm, is out with a look at the state of venture capital industry in the United States so far in 2017.  Here’s a look at what we find to be the 4 most interesting findings. #1 – A Slow Start to the Year First off, activity […]

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