venture capital investment continues to decline

The volume of venture investments in the world continues to decline: according to S&P Global Market Intelligence, in the third quarter of 2023, the amount of transactions in this sector decreased by 30% compared to the same period in 2022 – to $56.93 billion. The number of transactions decreased by 35% , up to 3323. The largest share of investor funds in the third quarter was attracted by the technology, media and telecommunications sector – 35.5% of the total volume. Within this sector, the leader (despite a decrease in investment by 41.5%) was the application software development industry ($8.23 billion). In second place by the value of venture deals is healthcare (16.1%), third is industry (14.9%). Half of the top 10 deals in the third quarter were in Asia. Among them is a $1.73 billion financing of Chinese integrated circuit and chip designer Runpeng Semiconductor (Shenzhen) Co. Ltd., for $1.25 billion – the Indian retail giant Reliance Retail and for $621 million – the Chinese energy equipment manufacturer Xiamen Hithium Energy Storage Technology Co.

Note that the consulting and research company Crunchbase previously assessed the state of global venture funding in the third quarter – and its drop in investments was not so deep: the volume of investments amounted to $73 billion, which is 15% less than in the third quarter of 2022. At the same time, a sharp decline was demonstrated by the financing of projects at an early stage (by 38%, to $23.4 billion). Financing for late-stage startups, on the contrary, increased—by almost 10% year-on-year, to $43 billion.

As for the situation in the Russian Federation, according to the Venture Guide company, in the third quarter the market revived somewhat: for the first time in a year, the number of transactions increased to 37 (in the second quarter there were 18, a year earlier – 32). In January-September, 82 transactions were carried out, which is 37% less than in the same period last year. At the same time, the volume of investments in annual terms decreased by more than six times, to $41.5 million. The leaders in terms of investment volumes were healthcare, transport and logistics. It should be noted that in the Russian Federation the share of transactions in the early stages of project development continues to grow: based on the results of three quarters, they accounted for 80% of the total number of transactions.

Venera Petrova