Infographic – Chill Descends on Q1 Venture Funds

Click on image for full-size view (CB Insights)

16 Apr. 2022. The rise in venture funds invested in start-up businesses worldwide over the past two years took a noticeable downturn in the first three months of 2022. According to data compiled by technology research company CB Insights (registration required) global venture capital investments totaled about $144 billion from January through March, a decline of 19 percent from the $178 billion recorded in the fourth quarter of 2021. The number of venture deals worldwide in Q1 2022 declined to 8,835, a more modest 4.5 percent drop from Q4 2021.

U.S. start-ups accounted for some $71 billion invested in the first quarter, nearly half (49%) of total venture dollars worldwide. Asian companies raised about $36 billion, a quarter (25%) of all global investments. Regional differences in Q1 are smaller in the number of venture deals, with U.S. start-ups registering 3,261 transactions or about 37 percent of the worldwide total, while Asian companies transacted 2,875 deals or about a third (32.5%) of the total. European companies raised nearly $27 billion in 1,863 deals, or 21 percent of all transactions.

The average size of venture deals in Q1 2022 dropped somewhat to $21 million, from $25 million in the previous quarter. But the median deal size, the half-way point in a range of largest to smallest deals, remained at $5 million. Also, early stage deals — defined by CB Insights as seed and first venture round or series A — continued to account for roughly six in 10 all venture transactions (62%), about the same percentage of deals in the past two years.

Exits from venture funding, often the goal of start-up enterprises, in the first quarter of 2022 show a mixed picture. Mergers and acquisitions remained about the same as Q4 2021, 2,983 and 2,980 respectively. But going public through initial public offerings or special-purpose acquisitions dropped sharply in Q1. IPOs fell to 143 in the first quarter from 260 in Q4 2021, while SPACs fell to 21 worldwide from 36.

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