venture capital New data suggests that the market is retreating somewhat from the aggressive pace of 2021.
According to data compiled by Carta, a unicorn startup that provides inventory management and other services to private companies, Series A to C stages in the United States are shrinking in terms of the size of rounds as well as the value of those deals. For investors looking for a deal, a price delay can be pleasant. For founders looking to secure the next tranche of capital, this news may be less desirable.
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We are only a few weeks away from the close of the first quarter of 2022, which means that we will be flooded with data on short-term performance of the domestic and global venture capital market at the beginning of the year. But while aggregated data is useful for identifying big, slow trends in the startup market, we’re more interested in short-term changes this morning.
This is for investors who are investing in the work now, and for startup founders who want to close a new round in the near future.
Today we are only talking about the US market, where Carta has the most data and therefore the strongest potential. However, we will continue to request such data from the company and its affiliates throughout the year. Now to the data.
How the US Series A, B and C rounds are changing
Let’s start with the capital raised per round.
The data here requires a little nuance. Through Insights Head Peter Walker you go to:
Please note that we are comparing the last two months of 2021 with the first two months of 2022, not full quarters. Walker also confirmed to gaming-updates in an interview that the data above is based on extreme dates, not announcement dates, so we don’t mix rounds from different time periods, which could skew the dataset.
From November and December 2021 to January and February 2022, the Serie A round saw the highest number of Middle Reduction of the round shape in the USA. This indicates that Series A outer rounds – in terms of size – are becoming less frequent. That the average round of Serie A fell for the same reasons, although it suggests a less steep drop than the average results. However, the Series A round will remain well above $10 million in the first months of 2022 on both average and average. Delay or not, the market is still hot.
Series B lap data is similar, with a faster average drop than the average lap size change. Even a smaller average drop than what we saw in the Series A round means that the Series B market is changing, but not as much for most companies. Series C data is more extreme, with round sizes falling faster than average, which means round outliers change in the corporate phase, but we see more movement between smaller trades than in Series A and B rounds.
As for the assessment, the data here are comparable, but with one caveat. From the same source: