Venture Funding looking forward to Q4 2024

We began the year pondering whether 2024 would bring about the Return of the Unicorns or usher in the Age of the Cockroach. Recent Q3 2024 reports from Pitchbook and Crunchbase suggest we are leaning toward the latter.

For any of you who have attempted fundraising this year the struggle has been very real. For those of you who were successful, a warm congratulations to you. For the rest, you are not alone.

Venture Financing Results Q3 2024

While there were early signs of improvement in Q2 2024, largely fueled by large AI deals, we have since seen the return to the 10-quarter trend of declining venture financing.

• Global Venture funding in Q3 was $67 billion.

• Marking a 16% decline quarter over quarter and 15% decrease year over year from Q3 2023.

This trend is further underscored by a concerning decrease in the number of active investors in the market, reaching levels not observed since 2017.

This decline contributes to the prevailing sentiment that the market remains in the early stages of a prolonged recovery. The consensus is that until we witness a substantial increase in IPO distributions or a notable surge in M&A activity, the current headwinds will likely continue.

So what can you do?

As we transition into a new normal characterized by more extensive and thorough due diligence, prioritizing quality over quantity becomes essential.

This places a responsibility on entrepreneurial teams to:

• Assess your current financial situation and ensure it aligns with your pitch.

• Understand your cash runway.

• Strategically outline your path to profitability.

• Develop a clear Use of Funds and recognize where it will lead you.

If you feel uncertain in these areas, concentrate on enhancing them or seek assistance from someone with expertise.

Feel free to reach out to us to discover how Anabatec or one of our partners can support you.