<p>Global venture capital (VC) investment dropped for the sixth consecutive quarter in the June quarter of the calendar year (CY) 2023– falling 10.2% in value terms from $86.2 billion Q1CY23 to $77.4 billion in Q2CY23. The fall in the number of deals was, however, steeper at 23% from 10,121 to 7783 deals between the two quarters. This is the lowest level of quarterly investment since Q2CY20.</p>.<p>The Americas took the lion’s share of 55.42% attracting VC investment of $42.9 billion and Asia took up 25.96% roping in $20.1 billion. Agritech also remained high on the radar of VC investors in the country, although it remains a relatively nascent industry. </p>.<p>Interestingly, VC investment in India bucked the global trend to actually see a rise in the June quarter, on the back of sectors including fintech, edtech, and gaming, which continued to attract solid interest. </p>.<p>The growth however remained very subdued compared to many historical quarters — including the same quarter last year, which saw over $8 billion in VC investment. </p>.<p>“While the last 2 quarters have been muted, we expect activity to be significantly higher by the end of this calendar year,” said Nitish Poddar, Partner and National Leader, Private Equity, KPMG India. “The path to profitability and positive operating cash flow continues to be a critical success factor for the business owners to attract funding,” he added.</p>.<p>Increasing interest rates, high inflation, geopolitical challenges and ongoing concerns about the stability of the global banking system made it a challenging quarter for VC investment across regions. In addition, a steep decline in late-stage deal value and number of deals — particularly for Series D+ deals — continued in Q2’23 owing to ongoing investor concerns about valuations and a lack of exit opportunities, the report further noted. </p>.<p>Individually, the biggest investment of $6.8 billion was raised by US-based Stripe. Singapore’s Shein netted the next big deal of $2 billion and $1.3 billion was raised by US-based AI startup Inflection. In India, Byju’s raised $700 million, while $600 million was roped in by online optical platform Lenskart and $168.1 million by mobile balance management app company True Balance.</p>.<p>Interestingly, investment in artificial intelligence remained robust in Q2CY23 and the largest mega deals were tech-based including the money raised by Microsoft-backed AI startup Inflection in California. Corporate investors showed the most interest in the generative AI space, particularly global tech giants with the massive data sets required to underpin robust generative AI solutions.</p>
<p>Global venture capital (VC) investment dropped for the sixth consecutive quarter in the June quarter of the calendar year (CY) 2023– falling 10.2% in value terms from $86.2 billion Q1CY23 to $77.4 billion in Q2CY23. The fall in the number of deals was, however, steeper at 23% from 10,121 to 7783 deals between the two quarters. This is the lowest level of quarterly investment since Q2CY20.</p>.<p>The Americas took the lion’s share of 55.42% attracting VC investment of $42.9 billion and Asia took up 25.96% roping in $20.1 billion. Agritech also remained high on the radar of VC investors in the country, although it remains a relatively nascent industry. </p>.<p>Interestingly, VC investment in India bucked the global trend to actually see a rise in the June quarter, on the back of sectors including fintech, edtech, and gaming, which continued to attract solid interest. </p>.<p>The growth however remained very subdued compared to many historical quarters — including the same quarter last year, which saw over $8 billion in VC investment. </p>.<p>“While the last 2 quarters have been muted, we expect activity to be significantly higher by the end of this calendar year,” said Nitish Poddar, Partner and National Leader, Private Equity, KPMG India. “The path to profitability and positive operating cash flow continues to be a critical success factor for the business owners to attract funding,” he added.</p>.<p>Increasing interest rates, high inflation, geopolitical challenges and ongoing concerns about the stability of the global banking system made it a challenging quarter for VC investment across regions. In addition, a steep decline in late-stage deal value and number of deals — particularly for Series D+ deals — continued in Q2’23 owing to ongoing investor concerns about valuations and a lack of exit opportunities, the report further noted. </p>.<p>Individually, the biggest investment of $6.8 billion was raised by US-based Stripe. Singapore’s Shein netted the next big deal of $2 billion and $1.3 billion was raised by US-based AI startup Inflection. In India, Byju’s raised $700 million, while $600 million was roped in by online optical platform Lenskart and $168.1 million by mobile balance management app company True Balance.</p>.<p>Interestingly, investment in artificial intelligence remained robust in Q2CY23 and the largest mega deals were tech-based including the money raised by Microsoft-backed AI startup Inflection in California. Corporate investors showed the most interest in the generative AI space, particularly global tech giants with the massive data sets required to underpin robust generative AI solutions.</p>
