Hi there, 

The VC numbers are in. 

Global venture funding and deals continued to slide in Q1’23. 

Startups raised $58.6B in the first quarter, down 13% from Q4’22. 

“That doesn’t sound so bad,” says the voice in your head.

Well, those numbers are buoyed by Stripe’s $6.5B mega-funding.

Take the outlier out and funding was actually down 22% from Q4’22. 

Overall, funding hit the lowest quarterly funding total since Q4’19.

The situation for deal activity, often the better gauge of the market, was also not great with deals hitting the lowest level since Q2’20.

The unicorn game got tougher with only 13 companies getting their horn in Q1’23. This was the lowest unicorn birth count in 6 years (page 32 of the report).

Investors have pulled back dramatically from late-stage rounds, which accounted for just 8% of Q1’23 deals. 

Other key stats CB Insights customers can dig into in our Q1’23 State of VC Report include: 

• Double-digit drop in funding across regions (except for the US) (p.6)

• Deal sizes getting smaller — the median late-stage deal size was actually smaller than mid-stage (p.24)

• -47% quarterly drop in IPOs (p.38)

Get the details here on the rough Q1’23.  

Please note that the full 47-page State of Venture Report is now only available to paying CB Insights customers.

Do you believe in magic? 

Just 13 unicorns ($1B+ valuation) were born in Q1’23 — the lowest birth count in 6 years.

With down rounds, layoffs, and higher startup failure rates on the horizon, this slowdown makes sense.

For now, the global unicorn club stands at 1,206 members, and we identify every single one of them on this market map.

Reinvent yourself

E-commerce giant Alibaba recently announced it would split into 6 new units.

At least 3 units will continue to focus on Alibaba’s core retail business.

And they’ll likely support the behemoth’s “New Retail” vision for a seamless omnichannel experience.

We identify the priorities that will be top of mind for Alibaba as it undergoes this major restructuring.

GRC is hot

Governance, risk, and compliance (GRC) is an increasingly big priority for IT teams and business heads of financial services firms.

However, the number of best-of-breed solutions solving very specific GRC challenges is growing at a crazy rate.  

We dug into regtech companies helping financial institutions keep up with fast-moving GRC requirements.

Full steam ahead

Microsoft has poured billions of dollars into ChatGPT developer OpenAI.

However, it’s also placed a number of bets on other GenAI startups, across computing, mapping, and gaming.

Financial Times. Emma Dunkley (@EmDunks) covers fintech activity in Asia and cites CB Insights data.

SaaStr. Jason Lemkin (@jasonlk) discusses venture funding in 2023 using CB Insights research.

MarketWatch. Jon Swartz (@jswartz) discusses SVB’s impact on venture funding and mentions CB Insights research.
 

I love you. 

Anand 

@asanwal 

P.S. Want to dive deeper into the data behind our Q1’23 State of VC Report? Register for our 4/25 briefing today.