Global Venture Capital Funding All Time High

Josh Fraser May 5th, 2021 / Investing, Estated Episodes, Industry News

The global venture investment has soared to greater heights in the first quarter of the new year, achieving a total worth of $125 billion. It is a 50% rise from the last quarter, i.e., over $100 billion and a 94% massive year-over-year growth. 

The cause of this investment surge includes the creation of two new unicorn establishments on average, every single operating day. Those developments worth $1 billion or above were on a brisk pace in Q1 2021 compared to the last quarter's reports. The worldwide VC investment has reached a quarterly peak over the previous three months. In 2018, the fourth quarter's statements had shown a value of $92 billion and its second quarter of $91 billion. Moreover, the third quarter of the previous year values $87 billion, marking it as the third-highest quarter of the market.

The Standard and Poor (S&P) 500 index also shows record-breaking results over a year following the Covid-19 pandemic. Commercial firms now have more options for going public, like purposely-built acquisition entities, or SPACs, which exploded in popularity in the last year. The takeover markets are greater than ever after a year of pandemic-driven acceleration for several technology startups.

The money capitalized in the seed-funding phase lingered at $4.1 billion in Q1, 2021. Initial capital funding increased by 45 % quarter over quarter and 63 % year over year in Q1, 2021, bringing the total to $35.5 billion. This surge in rounds over $100 million was partly, but not entirely, responsible for this new high in early-stage financing.

Because of the delays in the information mentioned above, financing reports are usually lower for the latest quarter. However, this quarter previously shows a rise quarter over quarter, simply referring to how hot the demand for initial capital funding is and signaling that more investment will come if these growth patterns continue. The newest quarter showed a higher percentage of late-stage expansion at 79%, totaling beyond $100 million. In contrast, the previous quarter and the first quarter reporter 74% and 63% simultaneously of the previous year.

Retail, trade, transportation, financial services and medical care were among the top investment markets. Administrative services, banking, marketing, and business development are among the industries that have seen the most growth year over year. This quarter, the rate of acquisitions rose by 26% quarter over quarter and 44% year over year. The fiscal quarter's top deals comprised Hitachi's $9.6 billion takeovers of San Jose-based GlobalLogic, Okta's $6.5 billion purchase of a Seattle-based access control network, Auth0, and Nuverse's $4 billion acquisition of Shanghai-origin video game developer Moonton.

Coming to the public markets, eighty venture-backed enterprises went public in this quarter worldwide. Beijing-based video streaming site Kuaishou Technology was listed at $150 billion in its initial public offering, followed by Seoul-based e-trade and distribution business Coupang, which was rated at $60 billion, and Beijing-rooted RELX Technology, which was placed at $45.8 billion. Furthermore, the startup firms lifted $57.9 billion, which contradicts with the funds raised during 2020.

Noting the earlier performances makes sense to say that Q1, 2021 was one of the firm's best performances. 

Subscribe for more updates

Insights on industry trends, data, technology and everything in between.

Subscribe to receive Estated newsletters right in your inbox.

Return to blog