This slowdown you feel, in numbers

It’s more than a feeling. According to new data published by research firm Pitchbook and the National Venture Capital Association, venture capitalists are raising — and deploying — significantly less money than in recent years.

What you need to know: The total number of transactions in the United States fell by more than 25% between the first quarter of last year and this year. Less than 3,000 deals closed between the start of the year and the end of March, which doesn’t sound too bad until you realize things haven’t been this slow, comparatively, since 2018 ( see graph below).

The value of late-stage deals also fell like a rock in the first quarter. While it’s clear from recent headlines that the era of the “mega cycle” is over (for now), it’s another thing to read that late-stage stocks fell for the seventh straight quarter to 11 $.6 billion, according to Pitchbook and the NVCA. Both say only 19 late-stage mega-towers took place in Q1 2023, compared to 98 in Q1 2022.

Unsurprisingly, this slowdown, or resizing, or whatever you prefer to call it, has had ripple effects. In the first quarter, according to the organizations findings, the median valuation before late-stage silver fell 16.9% from the full-year 2022 figure to $54 million, while the median valuation before the silver fell over $100 million to $159. million.

The industry is under pressure from all sides. According to the latest data, $11.7 billion was closed in 99 venture capital funds in the first quarter of this year – most of that money raised by larger vehicles and the lion’s share, apparently. , by NEA alone, which said in January that it closed on $6.2 billion of capital commitments in two new funds. Indeed, while only two venture capital funds closed on $1 billion or more in the first three months of this year, last year 36 funds closed with more than $1 billion in revenue. commitments.

At the same time that they are garnering less capital commitments, VC portfolio companies are also getting stuck in a kind of exit purgatory. According to the NVCA and Pitchbook, only $5.8 billion in exit value closed in the first quarter, which apparently represents less than 1% of the total exit value generated in 2021 (it was a record year, but Ouch). With the IPO window tightly closed – there were only 20 IPOs in the first quarter – “pressure continues to mount within the ecosystem”, observe the authors of this latest “venture monitor” report. .

For more, stay tuned; next week, the organizations plan to file a lot more data. In the meantime, if you want to take a look at some of those numbers yourself, you can find them here.