Venture capital funding supported fewer startups in the U.S. last quarter, according to new data from PitchBook. Investors backed about 3,000 deals over that period — down about a third from a year earlier — and spent $39.8 billion, down by nearly half. The biggest drop was in angelor seeddeals for companies in the earliest stages.Globally, venture capital funding was down 48% in the first six months of the year, which Reuters attributes to sharply higher interest rates and an IPO drought.
- One bright spot: Investors poured over $40 billion into AI startups over the last six months.
- Enthusiasm for AI "has exploded among investors, executives and technology users," reviving interest in the broader tech sector, per The Wall Street Journal.
Editors’ Picks
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Nice chart showing just how crazy things got in 2020-2021 and why "unicorns" is a silly vanity metric that shouldn't be used to determine the success of an ecosystem. 🦄 A lot of companies are never going to recover from the silly high valuations they raised at. A lot of funds are never going to recover from the silly high valuations they invested at.via Dealroom.co 👍🏻#venturecapital #vc #startups #entrepreneurs #entrepreneurship #tech #technology #innovation #funding #investing #investment #investors #money #unicorns #success #growth
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Moira S. commented on this
Nice chart showing just how crazy things got in 2020-2021 and why "unicorns" is a silly vanity metric that shouldn't be used to determine the success of an ecosystem. 🦄 A lot of companies are never going to recover from the silly high valuations they raised at. A lot of funds are never going to recover from the silly high valuations they invested at.via Dealroom.co 👍🏻#venturecapital #vc #startups #entrepreneurs #entrepreneurship #tech #technology #innovation #funding #investing #investment #investors #money #unicorns #success #growth
Chief Executive Officer & Founder at Cubismi, Inc.
The Venture model is broken. I think Venture today is a perversion of what it once was, it has been gamed and lost core discipline… when VC’s make millions off large deals, no matter how much they fail, something is clearly way off…. Establishing a leap forward in new value prop takes discipline and lean processes to spend as little as possible (as Cubismi, Inc has done) then you get your perfected public marketing and take money and scale - these groups are investing not into solving real problems in order to generate new value, they are throwing money into #hype buckets, which a huge problem esp in #healthcare. They are wasting critical innovation dollars that are needed for crisis-level healthcare problems and this venture model puts all the wrong people in the drivers seat as decision-makers, who don’t fundamentally even understand the problems or have any real insight. Worse, they are putting patients in danger. #healthcare professionals and #physicians need to lead for responsible use of new tech, and we need systems to be problem-focused, not the broken “venture model”
See AlsoThe Boutique Advantage 5 Unexpected Benefits of Working for a Smaller Investment Bank - Blog - Circle Square$708.6 Billion Global Venture Capital Investment Market Report 2023: Industry Trends, Share, Size, Growth, Opportunities and ForecastsA Look Into VC Funding in 2019Venture Capital Boutiques and Tips for Enhancing Your StartupTo view or add a comment, sign in
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Djordje P. commented on this
Nice chart showing just how crazy things got in 2020-2021 and why "unicorns" is a silly vanity metric that shouldn't be used to determine the success of an ecosystem. 🦄 A lot of companies are never going to recover from the silly high valuations they raised at. A lot of funds are never going to recover from the silly high valuations they invested at.via Dealroom.co 👍🏻#venturecapital #vc #startups #entrepreneurs #entrepreneurship #tech #technology #innovation #funding #investing #investment #investors #money #unicorns #success #growth
Founder & CEO @ Plantech | The Launchpad For Next-Gen Founders
There's no doubt that unicorn boom was spectacular, but I believe it blurred, and maybe even ruined, what truly makes a successful ecosystem.High valuations have literally been proven to ruin sustainable growth and place extreme pressure on both companies and investors. Real success isn't just about billion-dollar tags, but also profitability, societal impact, and job creation.When will we finally shift focus from this overhyped unicorn craze to a more balanced viewpoint?
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Elisabeth L'Orange commented on this
Nice chart showing just how crazy things got in 2020-2021 and why "unicorns" is a silly vanity metric that shouldn't be used to determine the success of an ecosystem. 🦄 A lot of companies are never going to recover from the silly high valuations they raised at. A lot of funds are never going to recover from the silly high valuations they invested at.via Dealroom.co 👍🏻#venturecapital #vc #startups #entrepreneurs #entrepreneurship #tech #technology #innovation #funding #investing #investment #investors #money #unicorns #success #growth
Co-Founder & CCO Oxolo | gen AI | ex VC and CFO | W&V 100 | OMR 50 | Top 15 Women in AI in Germany (Manager Magazine) | FAZ Innovation Award | KPMG Venture Champion Award 2024
Very true. Downrounds will be the new normal.
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Freelance journalist covering tech and the climate crisis | John Schofield Trust 2024 Fellow
NEW: Venture capital-backed exits have slumped 40% in the first half of 2023, per PitchBook data.The lack of liquidity is making it even more difficult for VCs to raise new funds, analysts said.PitchBook's Nalin Patel said LP money could become trapped in companies that were "overdue an exit."Read the full story here: https://lnkd.in/eRvz4fZy #venturecapital
The dead IPO market is dragging down VCs' ability to raise new funds with returns tied up in startups overdue an exit, analysts say
businessinsider.com
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Falling venture capital funding presents serious challenges to tech entrepreneurs. Many unprofitable start-ups worth $1bn+ are expected to close their doors...Between April and June 2023, global VC investment declined to $64.6bn — down 49% from the same quarter last year, according to Crunchbase data. The latest six-month period was 51% down on the same period of 2022 and 10% lower than the second half of 2022. This decimation of VC investment comes despitehype around artificial intelligence (#AI)companies, which attracted nearly a fifth of total global VC funding in the first half of 2023.However, outside of AI many of the roughly 1400 unicorns — or start-ups with a valuation of $1bn or more — are expected to see a significant mark down in their valuations or go out of business over the next 18 months.Eli David, the CEO of research consultancy StartupBlink told me he expects there to be a "mass extinction" event for for companies with business models that do not work. Brad Gerstner, the CEO of Altimeter, said on the All-In podcast published on June 24th that he thinks as many as 100% of the 1,400 unicorns at the end of 2022 “will likely do a down round”. Some 30% to 40% of them "do not have product market fit and will disappear".🤔 What do you think ❓ Are we seeing the beginning of the end for many of the world's most valuable private tech companies ❓ And should we welcome the weeding out of unprofitable companies with faulty business models ❓ Read the full article here: https://lnkd.in/ecn9eSfz#data #tech #entrepreneurship #startups #venturecapital #investment #vc #funding #business #research #artificialintelligence #faulty #businessmodels #no #productmarketfit #entrepreneurs #mass #extinction #unicorns #falling #valuations #graphtime
Unicorns face mass extinction as funding plummets
fdiintelligence.com
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Top 20 Female Founder ⚡ Keynote Speaker 🎤 Marketing Expert 💼 Podcast Host 🎧 Big Sis 💘
The startup & investment landscape has changed *drastically* in a short space of time 😳And my goodness, was it needed.After working with 100+ startups, speaking with many more founders, and learning from the best early-stage VC investors, here are the key shifts in business:2021 - Inflated valuations, "growth at all costs" mindset, overhiring2023 - Realistic valuations, double down on profitability, hiring strategicallyDo you agree we've taken a sensible turn for the better, or do you miss the heyday of a couple of years ago? 😅Curious to get your thoughts! 👇🏼#startup #entrepreneurship #venturecapital #funding #profitability #revenuegrowth #businesstips #newrules #success #businessgrowth
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Helping Teams Find Their Next Senior Security Leader - North America & Europe- Host of The CyberSec Sessions - MHFA
Was the massive influx of investments in 'AI Companies' enough to outpace the VC funding slowdown?In short, no.Funding in H1 was down 51% from the same period last year, and down 10% from H2 2022. Despite AI investments making up a pretty massive 18% of the funding rounds YTD (notably the well documented ones from Microsoft, Nvidia and Google alongside VC's), this is still a marked decline.To end things on a positive though, in Q2 there were over 6000 startups that managed to raise funding, meaning despite the doom and gloom, there is still hope out there.There were a few non-AI based investments in the US in June worth noting as well such as:🌳$500m For clean energy team CleanCapital🧬Nearly $500m in biotech investments - Alkeus Pharmaceuticals, Inc. ($150m), Upstream Bio ($200m), Bitterroot Bio ($145m)🔐And my personal favourite $190m for Blackpoint Cyber to continue to develop thier suite of Cybersec projects ( Always great to see my sector grow)So to all my Founders out there, the market is tough, but theres still hope, even if your company isn't fitting in with the current buzzwords.#ai #startups #investment #cybersecurity
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Very interesting point about start-up financing! VC-led funding rounds can be a great way to get a large cash injection and access to experts/key advisors, but it may not always be the best route for your business 📈💵 #startupfunding #startup #fundinground
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Venture capital (VC) funding has emerged as a critical source of capital for startups looking to grow and scale their businesses. However, not all venture capital funds are created equal, and choosing the right one can significantly impact the trajectory of your startup's success. In this article, I explore the various types of venture capital funds and provide valuable insights on how to make an informed decision when selecting the ideal funding partner for your startup.#startup #venturecapital #funding
Navigating the Realm of Venture Capital: Choosing the Right Fund for Your Startup's Success
Sam Adekunle on LinkedIn
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