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Private Company Valuations: New Enterprise Associates

Posted by Justin Byers, Lead Business Intelligence Analyst on October 09, 2008

So far this year, New Enterprise Associates is leading VC firms in amount invested in private venture backed US companies with approximately $358 MM, and second to Draper Fisher in the number of deals. The VC Experts analyst team has reviewed a few of the deals that New Enterprise Associates has participated in so far this year.

Cost of Capital Benchmark

We plugged in the details of each round into our Cost of Capital Benchmark tool, and as you can see, so far this year, CVRx, Inc. has received the most “company friendly” capital as compared to SiBeam, Inc. and DreamFactory Software, Inc.

Keep in mind, the lower you are on the chart, the more company-friendly the money, the higher you go on the chart, the more investor-friendly the money. If you are a company raising money, you want be lower on the chart. This is a time when it is not best to be on top if you are the company raising money.

Cost of Capital Benchmark

SiBeam, Inc. (formerly Silicon Microwave Systems) is headquartered in Sunnyvale, California. The company is a leader in developing semiconductor solutions for wireless platforms. Earlier this year, the company closed a round totaling approximately $40 MM. Some of the participants alongside New Enterprise Associates in this Series C round were U.S. Venture Partners and Foundation Capital.

The Deal Terms of this Series C Round were:

Type of Preferred – Participating Preferred

Participation Cap – No

Round Direction - Up

Dividends –Non-Cumulative @ a rate of 8%

Liquidation Multiple – 1x

Liquidation Preference – Pari Passu with other Series Preferred

Anti-Dilution Protection – Weighted average

Pay-to-Play Provisions – None

Price Per Share - $2

The total amount raised following this round was approximately $40 MM

VC Experts calculated a Post-Money Valuation of $137,975,000

Located in Minneapolis, Minnesota, CVRx, Inc. is a developer of implantable devices designed to control hypertension. The company has raised several rounds of financing and New Enterprise Associates has participated in all of them. Some of the other firms that participated in these rounds with NEA were ABS Ventures, Kearny Venture Partners, SightLine Partners, and InterWest Partners.

The Deal Terms were:

Filing Date – 05/05/2006

Round of Financing – Series C

Type of Preferred – Conventional Convertible

Round Direction - Up

Dividends –Non-Cumulative @ a rate of 8%

Liquidation Multiple – 1x

Liquidation Preference – Pari Passu with other Series Preferred

Anti-Dilution Protection – Weighted average

Pay-to-Play Provisions – None

Price Per Share - $3.05

The total amount raised following this round was approximately $30 MM

VC Experts calculated a Post-Money Valuation of $95,018,922

Filing Date – 04/26/2007

Round of Financing – Series D

Type of Preferred – Conventional Convertible

Round Direction - Up

Dividends – Non-Cumulative @ a rate of 8%

Liquidation Multiple – 1x

Liquidation Preference – Senior to other Series Preferred

Anti-Dilution Protection – Weighted average

Pay-to-Play Provisions – None

Price Per Share - $6.20

The total amount raised following this round was approximately $65 MM

VC Experts calculated a Post-Money Valuation of $266,985,857

Filing Date – 07/23/2008

Round of Financing – Series E

Type of Preferred – Conventional Convertible

Round Direction - Up

Dividends –Non-Cumulative @ a rate of 8%

Liquidation Multiple – 1x

Liquidation Preference – Senior to other Series Preferred

Anti-Dilution Protection – Weighted average

Pay-to-Play Provisions – None

Price Per Share - $7.58

The total amount raised following this round was approximately $84 MM

VC Experts calculated a Post-Money Valuation of $423,623,945

DreamFactory Software, Inc. is located in Mountain View, California. A developer of customization and integration technology for On Demand software systems, the company closed a round of funding totaling approximately $3 MM in March 2008. This brought the total amount raised after two rounds to approximately $8.8 MM. New Enterprise Associates led both rounds financing.

The Deal Terms of these rounds were:

Filing Date – 01/27/2006

Round of Financing – Series A

Type of Preferred – Participating Preferred

Participation Cap – 3x

Dividends –Non-Cumulative @ a rate of 8%

Liquidation Multiple – 1x

Anti-Dilution Protection – Weighted average

Pay-to-Play Provisions – None

Price Per Share - $.7585

The total amount raised following this round was approximately $5.8 MM

VC Experts calculated a Post-Money Valuation of $16,044,212