The Strategist

Analysts report decline in venture capital market activity to 2020 levels



06/28/2022 - 11:31



The last three months have seen the lowest level of activity in the venture capital sector since 2020. Bloomberg estimates that at the start of the year, there were around two new "unicorns" created each day.



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According to statistics from the analytical firm CB Insights, investor activity in the venture capital market has decreased to its lowest level since 2020.

The agency notes that there were 23% fewer deals globally in the second quarter than there were from January to March. The amount corporations were able to attract declined and was down by 27% from the first quarter. According to Bloomberg, companies in the last stages of development are under particularly intense pressure: investment rounds in the D series and above saw a 43 percent reduction.

Sequoia Capital issued a warning to portfolio businesses to drastically cut expenditures in May, forecasting an extended downturn.

The environment for investing in technology has altered significantly in recent months. After a brief moment of uncertainty at the beginning of the COVID-19 pandemic, investment activity quickly increased as a result of the change to working remotely, according to the agency. Eventually, entrepreneurs received a record amount of money last year. According to Bloomberg, there were about two new "unicorns" (businesses valued at over $1 billion) being created every day by the beginning of 2022.

source: bloomberg.com