According to Crunchbase News research, global venture capital dropped to $25.2 billion in August 2022, the lowest monthly funding level seen in the two years since August 2020. Over the past year, there has been a 52% decrease, and this past month has seen a 10% decrease. At every level, fewer startups are raising money. Also, hiring is slowing down, resulting in more layoffs, and businesses are closing.
Snap, a company that announced layoffs this past month, let go of 20% of its personnel, or roughly 1,300 workers. Additionally, Robinhood laid off around 800 employees, or 23% of its staff. Real estate firms like Reali, which manages property sales, and The Wing, a gathering place for women, have both been shuttered. Additionally, as companies try to raise bridge financing to extend their runway, extension rounds are becoming more common for businesses that need to raise capital.
Worldwide Funding By Month Late-stage funding experienced the most significant year-over-year decline until August 2022, falling by over 65% for the most recent month. Seed funding has decreased by 19% and early-stage investment by about 35% over the same period.
Global Investments By Stage A through C, to August 2022, The trends change when we break down funding by each succeeding level for Series A through C in 2022. The financing decline had the least impact on Series A rounds, which saw money remain stable in August 2022 compared to August 2021. On the other hand, funding for Series B rounds declined by 55% over that time, while Series C funding fell even more, by 77%. For the Series B and C rounds, this year got off to a good start, raising more money early on than in 2021. But after March, Series C funding started to trend significantly below 2021 values, and Series B funding did the same and declined even more sharply in July and August 2022.
Series A through C. Year Over Year, by Month, Meanwhile, new public cloud software companies have also been severely impacted. The funding for those companies in August 2022 is down by a comparable percentage from August 2021, and the Bessemer Cloud Index is down 55% from a year ago. Furthermore, August witnessed the lowest number of new unicorns in two years, which indicates that the huge private valuations we are used to seeing have slowed. We have all been waiting for a pullback, and it has arrived. Will February 2020’s $18.3 billion in worldwide monthly funding, the lowest funding month on record since the start of 2019, represent this fall’s lowest funding level? All we can do is wait.
All the Crunchbase Pro queries listed for this article are dynamic, with results changing over time. For analysis, they can be changed according to place and/or time. Global funding in 2022 and the unicorn scoreboard (1,398)
This report includes funding rounds for venture-backed companies such as seed, angel, venture, corporate venture, and private equity. This is based on Crunchbase data as of September 6, 2022. Please be aware that, unless otherwise specified, all funding values are provided in US dollars. From the published date for fundraising rounds, acquisitions, IPOs, and other financial events, Crunchbase converts foreign currencies to US dollars at the current spot rate. Foreign currency transactions are converted at the historic spot price even though those events were added to Crunchbase a long time after they were first publicized.
