PS#045: The Secret VC Database
Today, I’d like to let you in on a little secret.
This secret will help you stay on top of the current market, provide long-term insights on the VC industry, and give you a competitive edge as an aspiring investor.
The secret? Law firms.
The law firms in the venture capital industry are processing all of the completed deals that happen throughout the year (and have been for many, many years). They sit on a treasure trove of data that can give you a great perspective on what is happening currently (as recently as the past quarter) and what has happened historically.
Even better, a lot of them will create reports on the VC industry as a whole or on specific subsegment of the market (i.e., Europe, Life Sciences, etc.).
These secret databases can give you an incredible edge when it comes to interviewing for an internship/full-time role or just starting out as a new investor.
Let’s talk about how in more detail.
What’s included in these reports?
For almost every venture capital transaction, there is a law firm processing the deal.
That means that these firms know all the important details around the structure and valuation of a venture capital investment. When extrapolate this across hundreds or thousands of deals (and then extrapolate this across several different firms), you get a really great view of the venture market.
More specifically, these reports will include data around…
Number of financings
Size of financings
Pre-money & post-money valuations
Total amounts raised
Time to IPOs or M&A exits
Priced round deal terms
SAFE & convertible note deal terms
M&A deal terms
These reports will break down these data points by industry, geography, stage, etc. They will also provide guidance on why they are seeing what they are seeing.
It’s pretty remarkable.
While other databases might not be wholly accurate, this data is clean and exact, coming right from the source.
What are some examples?
OK, now that we understand the power of these databases, let’s get to the specifics.
Here are the 5 law firms that I check most often (due to a combination of data, ease-of-use, frequency, etc.) for venture capital industry reports…
WilmerHale
Cooley
Wilson Sonsini
Fenwick & West
Orrick
Let’s dive into each of these
WilmerHale
WilmerHale Venture Capital Report
Many of you will recognize this firm. I’ve worked with them in the past and think highly of their team. As an added bonus, they put together a great report on the VC industry.
This report walks through data around priced rounds, SAFEs, convertible notes, IPOs, M&A exits, etc. They break it down by stage and geography, giving you a great sense of how the market is trending. They also provide guidance on relevant laws and detailed analysis on deal terms at each stage of the investment lifecycle.
Cooley
This is really cool.
Cooley GO not only provides a venture financing report, but it also provides an interactive database. You can play with the data yourself, breaking it down by stage, industry, terms, etc. The flexibility of the platform (powered by Tableau) allows you to cut the data to fit your needs.
Wilson Sonsini
This report is similar to the WilmerHale one that I mentioned earlier. They provide similar data as well as commentary from their own clients. They will also give guidance around new laws/technologies, such as how to handle generative AI models within your business.
Fenwick & West
Silicon Valley Venture Capital Survey
Since 2002, Fenwick & West have been surveying the venture capital industry and publishing its findings. They focus on covering deals within and outside of their firm in this survey. It provides similar information to the ones mentioned above and is another great resource for investors.
Orrick
Orrick is another prominent venture capital law firm. They hold a strong presence in Europe as one of the top law firms for the VC industry. If I’m in need of industry information focused on Europe, I’ll often check their resources to see if they have some of the latest information.
How to use these reports.
Not only do I use these reports in my regular work as an investor, but this was a key part of my preparation process when it came to interviews and internships.
Next week, I’ll speak in a bit more detail about how you can use these reports in the venture capital interview process.
