Venture backed activity took a big breather in the first quarter as big companies digested large acquisitions, and public markets accustomed themselves to a new crop of technology startups with big valuations.

That’s the news from the National Venture Capital Association, whose report on venture activity for the first quarter of 2015, released Monday and produced in collaboration with Reuters, shows a steep drop-off in mergers and acquisitions and IPOs.

“Much of [the decrease] is because the companies that were ripe to go public and had been waiting a long time to go public, did so in 2013 and 2014,” says John Taylor, head of research for NVCA. “And some of the companies that at other points in time would have gone public, such as Uber, have been benefitting from private markets and huge rounds of money.”

Behind the Numbers

The first quarter saw the number of IPOs decrease 54 percent to 17, compared to the first quarter of 2014. Similarly, there were 86 merger and acquisition deals, down 25 percent from the first quarter of 2014. By total dollar value, IPO deals fell nearly 60 percent to $1.4 billion. Mergers and acquisitions plunged 73 percent to $2 billion.

The merger and acquisition data is somewhat tricky, Taylor notes, because information about the deals is often harder to parse due to their complexity or lack of availability.

The size of deals for both IPOs and mergers and acquisitions is also falling. The average IPO during the quarter was $84 million, compared to $92 million in the first quarter in 2014. Similarly, the average deal size was $128 million, nearly half the average $245 million compared to the same quarter a year ago.

The drop in the value of IPO deals has to do with the kinds of companies that are going public, says Taylor. Three quarters of the deals in the first quarter were in biotech, life sciences and medical or health-related industries. Historically those have tended to be smaller, Taylor says.

There are other anomalies getting worked out in the data, specifically in the number of really huge-sized IPOs from the past two to three years. Facebook, which went public at a staggering $16 billion in the second quarter of 2012 accounted for nearly all of that quarter’s total of $17.2 billion raised.

By contrast, the largest IPO in the first quarter of 2015 was for cloud storage Box, which raised close to $200 million. Box was an Inc. 5000 company.

On the Horizon

Looking forward, some venture capital experts say to expect more, modest acquisitions, as well as some very large IPOs, when companies such as Uber decide to go public.

In 2014, ride share service Uber successfully tapped private investors, raising $3 billion from venture capital companies including Menlo Ventures and Google Ventures. And in the first quarter of 2015, it raised an additional $2.6 billion debt and equity financing from Goldman Sachs and other investors. The company is currently valued at more than $40 billion.

Some of the biggest acquisitions in 2014 included Google’s $3.2 billion acquisition of smart device maker Nest Labs, and Apple’s $3 billion acquisition of headset maker Beats Electronics.

“There continues to be a lot of optimism driving acquisitions and IPOs, and the two things are connected,” says Ross Fubini, partner at Canaan Partners, in Menlo Park, California.