venture capital

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

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. 

Georgia Research Alliance companies raise more than $2B in venture capital

The Georgia Research Alliance (GRA) — a nonprofit working to grow Georgia’s economy through supporting research at state universities — recently announced that its portfolio of companies had raised more than over $2 billion in venture capital. These startups also had a high survival rate — 88% were still in business four years after launch, outpacing the national average of 44%. Along with this announcement, GRA released 2021 data on their economic impact on the state, demonstrating growth from the previous year.

Gender and racial makeup of startup's founding team impacts funding

A recent report by DocSend Inc., a subsidiary of DropBox, surveyed over 300 pre-seed startups, finding that on average, in terms of gender alone, mixed teams raise the most funds, while all-male teams raise the least. In terms of both gender and race, on average, mixed gendered teams with minority members raise the most funds while all-male teams with no minority members raise the least. These findings are consistent with prior studies in terms of reflecting the levels of access to funding opportunities, relative lack of investment in diverse teams, and systemic gender bias.

Equity investors rolled through Q2 uncertainty

Amid a public market slowdown, inflation concerns and tightening monetary environment, the PitchBook-NVCA Venture Monitor Q2 2022 indicates that most investors continued their COVID-era levels of activity through the second quarter of the year. While observed investment deal counts are down, PitchBook has already identified a total investment value of more than $144 billion across angel, seed and VC deals for the first half of 2022 — an amount that would have represented a strong annual total prior to 2021.

Recent Research: Lessons from the first cleantech bubble and the role of venture capital and governments in clean energy

From 2005 to 2008, the clean technology industry experienced a venture capital boom where the share of total VC investments in clean energy technologies tripled before falling dramatically. Many studies have concluded that the boom and bust in cleantech as an equity investment focus was because clean energy does not fit the venture capital “model.” A recent study from the National Bureau of Economic Research explores other possible reasons for the failure of venture capital to remain interested in clean energy.

Are specialized VCs special?

A recent analysis by PitchBook attempts to assess whether venture capital funds that specialize in a specific technology sector outperform generalist VCs or VCs that are targeted but not quite “specialized.” In short, the answer is no, at least as measured by financial return.

Useful Stats: Investment deals by size per state, 2012-2021

While the overall U.S. venture capital market has drawn headlines for record-breaking total investment levels in 2021, the story has been far different for smaller deals. Data currently suggests a decline in deals under $1 million, and only modest growth for deals under $5 million. The final data may tell a slightly different story,[1] but the level of activity at the smaller end of the spectrum is clearly quite different than what is driving market coverage. Of the $335 billion in angel, seed and venture capital deals PitchBook has identified for 2021, more than 10 percent went to deals of $1 billion or more and almost 60 percent to deals worth at least $100 million.

Useful Stats: Venture Monitor reports record-breaking year for VC deals

The Pitchbook-NVCA Venture Monitor Q4 2021 reports unprecedented growth in venture capital activity through 2021. Although total deal count had decreased by almost 2.5 percent from 2019 to 2020, deal activity in 2021 surpassed that of both 2020 and 2019 – showing that 2021 saw substantial growth from pre-pandemic levels.

Recent Research: The role of alumni networks in VC fundraising

Loyalty to alma maters matters financially beyond March Madness™ and college sports betting, it turns out — to such a degree that policy makers, venture development organizations and university seed funds hoping to attract equity investments for local innovation startups should pay considerable attention to the educational attainment section of founders’ LinkedIn profiles or resumes. Additionally, seed and VC funds organized in part for economic development goals may want to tap alumni networks from the regions’ institutions of higher education to identify potential investment partners, according to a recently released working paper from a trio of professors in Iowa, Texas and Michigan.

Initial venture capital data: $330 billion invested, $128 billion raised

PitchBook and NVCA have published an initial look at the Venture Monitor Q4 2021, and the data already suggest an astounding level of activity in 2021. As of Dec. 31, PitchBook had identified $330 billion invested across more than 15,000 deals, substantial increases over the $167 billion invested across 12,000 deals in 2020. The increases were driven by venture capital stage investments (as opposed to seed and angel investments), which accounted for 80 percent of the additional deals. Firms raising new venture funds also did very well in 2021, with 730 funds raising $128 billion — up from $87 billion in 2020. These data are preliminary and will be updated when PitchBook and NVCA publish the formal Venture Monitor for 2021, which SSTI will then cover in detail (including by sharing state-level investment activity).

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