Even like Y Combinator This summer shows the latest startups in the group, we have bad news for founders: the global venture capital market has decreased in Q1 2023, and it would have been worse if it weren’t for a few mega deals, as Crutchbase (statement of my former employer) and Pitchbook reports. And here in the United States, things are very bad.
It’s not just startups that suffer. Venture capitalists are seeing their fundraising ability hampered by a combination of misbranded startup deals from the last boom and a lack of exit volume.
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This funding for venture investors indicates that the current decline in start-up investment is unlikely to reverse course anytime soon.
The exchange will soon have a note on what appears to be a set of expansion startups that could be the first companies to pursue IPOs when the market opens. But now we are having a hard time seeing the flow of money. into Starter land, not the other way around.
There is little good news in this Q1 data, but don’t let that weigh you down. The numbers aren’t great, sure, but they’re not so true As bad as we feared last year we wouldn’t go to 2023. in the future!
In Q1 2023, global venture capital is on the way back.
According to Crunchbase data, total funding for startups fell to $76 billion in the first quarter from $162 billion a year earlier. In the year This comparison is somewhat unique if you’re not that far from the peak of the last startup cycle in early 2022. We all know things have slowed down since then.
To highlight, the total value of startup investment in Q1 2023 increased by 1% compared to Q4 2022, a more recent and therefore more meaningful comparison. It’s good to wake up, isn’t it? Why should we worry about failures if the total sum of the venture is not going to land?
As my long-time friend and former colleague Jane Terr explained the difference in first-quarter numbers, the small gains in first-quarter dollars included:
“A reported $10 billion investment in OpenAI — mostly from Microsoft — and a $6.5 billion round for payments giant Stripe. Without those two big deals, Q1 venture funding would have dropped dramatically, to nearly $60 billion.”