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Positive trends in deal counts, fundraising, according to new VC report

October 20, 2022
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By: Emily Schabes

Between federal interest rates over 3% and post-pandemic economic impacts that affect macroeconomic trends, many have predicted a continued decline in venture capital outcomes, only some of which has held true through Q3. 

Overall deal counts were higher than anticipated, according to the most recent PitchBook Venture Monitor that covers Quarter 3. The report captures 11,871 deals so far in 2022 (with another 1,765 that PitchBook estimates to have occurred but have not yet been formally identified) with a total value of $194.9 billion. Both deal activity and value would be a decline from the historic high of 2021 but on track to exceed all other years since 2012. 

The report shows a significant decrease in both angel and seed deal counts, but the decrease in seed deal counts is less severe as compared to angel deal counts. Angel deal value has also decreased, likely as a result of the decline in deal count. However, seed deal value continues to stay relatively high, beating every year except 2021 since 2012. Angel deal value is $0.6 billion, compared to $1 billion in 2021. 

Of states that had at least 100 deals (which includes 28 states) in 2021, five of them are on track to have as many or more deals in 2022. These states include: Florida, Delaware, Ohio, Indiana and District of Columbia. 

Billion-dollar funds have set a record high and have contributed significantly to the high amount of capital raised this year. The percentage of funds that are valued at $1 billion or higher have almost doubled since 2021, with 23 $1 billion+ funds in 2021 and 35 as of the end of the third quarter in 2022, with the continued trend of large amounts of capital being invested into a smaller number of funds. 

Exits have continued to decline, as predicted with current macroeconomic trends and the record level of activity in 2021. The observed exit count to date in 2022 is currently 906 (with a projected total of 1,092) with an exit value of $85.4 billion, a value that is expected to set a five-year low and is unlikely to rebound before the end of the year. 

vc, venture capital