After a two years irrational investment spree, global venture financing sinks in 2022!
- Cyclyst
- Feb 5, 2023
- 1 min read
The latest Q4-2022 KPMG quarterly report on Venture Pulse depicts the clear decline of the overall venture financing, from its pick of $205B in Q4-2021 to $75B one year after, on Q4-2022!
A few side effects:
Increased "mortality" rate for seed, A, and B funded companies, especially the ones receiving capital 18+ months ago (mid-2020), with total raised capital exceeding today's valuation, and with a conservative cost-cutting policy!
Turmoil for VCs, especially those super-optimistic during the pandemic, who followed the momentum investing model, and will be obliged to recap their portfolio companies, entering ugly talks with wiped-out founders!
Clear patterns to identify the VC bubbles: valuations going UP and more money coming IN.
The great VCs will be still profitable!
The new great companies, (the new google and the new facebook) will still get funded, based on a solid foundation of smart founders, great business, clear revenue models, and huge net profits!
The Cyclyst
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