Drill down on financing trends and data.

Cooley handled 247 reported venture capital financings in Q3 2024 , representing $13.5 billion of invested capital, which is the largest amount of invested capital reported since Q2 2022. While invested capital saw a significant increase over Q2 2024, deal count for Q3 2024 was slightly down since last quarter. In Q3 2024, deal volume remained about the same as for Q2 across most stages of financing, aside from Series A deals, which saw a decrease from 107 to 79 deals, and Series B, which saw an increase from 38 to 53 deals from Q2 to Q3. Invested capital increased across most deal stages in Q3 2024, but it decreased slightly for Series A deals from $2 billion in Q2 to $1.6 billion (likely reflective in part of fewer deals). The increase in invested capital from Q2 to Q3 2024 was most significant in Series B rounds, which climbed from $1.3 billion to $3.7 billion, and Series D and later rounds, which increased from $2.3 billion to $6.4 billion.

Median pre-money valuations increased for Series Seed financings and Series C and later rounds, though not for Series A and Series B financings. The most significant increase was in Series D and later rounds, which rose from a median of $794 million in Q2 2024 to a median of $1.2 billion in Q3 2024, representing the first time the median for Series D and later rounds has exceeded $1 billion since Q2 2022. Meanwhile, median pre-money valuations decreased for Series A and B rounds, with Series B deals seeing the largest decrease, declining from a $140 million median in Q2 2024 to a $120 million median in Q3. The percentage of deals with pre-money valuations greater than $100 million (at all stages) increased to 30% of deals in Q3 2024, up from 27% of deals in Q2.

The percentage of down rounds remained the same for Q3 2024 at 23% of deals, which is still relatively high compared to pre-2023 data. The percentage of deals representing up rounds increased slightly to 75% in Q3 2024, compared to 74% in Q2, while the percentage of flat rounds decreased to 1.8% of deals for Q3, compared to 3.3% of deals in Q2.

In Q3 2024, the percentage of deals involving a recapitalization increased marginally to just over 2% of deals, compared to 1.6% of deals for Q2. The percentage of deals with a pay-to-play provision decreased very slightly during the quarter, at 8.5% of deals in Q3 2024 versus 8.7% of deals in Q2. The Q2 2024 percentage of pay-to-play transactions was a high-water mark since the inception of this report in 2014, and Q3 2024 represents only the third time in this report’s history that the percentage of deals with a pay-to-play provision has exceeded 8%.

Despite the increase in deals involving a recapitalization and the continuing relatively high percentage of deals with pay-to-play transactions, other deal terms remained favorable to companies in Q3 2024. The percentage of deals with a one-time liquidation preference and the percentage of deals with nonparticipating preferred stock remained high, representing 96% of deals for both provisions for Q3 2024. For the first time since the inception of this report, 100% of reported deals had broad-based weighted average anti-dilution protection, with no deals having full ratchet anti-dilution protection.