US VC funding deals fell by 49% in Q1; India bucks trend

The venture capital inflows into the start-up ecosystem has witnessed a sharp fall in the first quarter of 2024. The number of funding deals fell by 49 per cent to 1,137, resulting in a fall of 35.7 per cent in value terms to $24.2 billion.

“Despite a decline from the previous year, the US maintains its global VC funding landscape dominance,” according to data and analytics firm GlobalData, a leading data and analytics company.

The US registered 2,232 VC funding deals in the first quarter last year with an aggregate funding of $37.7 billion.

The fall in the number of deals and the total value of the deals reflected a continued bearish trend in the VC investment landscape.

• Also read: Indian startup funding sees revival, VC investments double in Q1 2024

Total deals in APAC

A similar trend was seen in the Asia-Pacific region where several top investment destinations registered a fall in the number of deals in the first quarter.

A total of 3,231 deals (comprising mergers and acquisitions (M&A), private equity and venture financing deals) were announced in the APAC region during the first quarter (Q1) of 2024. This showed a year-on-year decline of 12.2 per cent compared to the 3,681 deals announced in the comparable quarter last year.

India, however, seems to have bucked the trend. “Deals volume for India remained mostly at the same level at around 640 for Q1 2023 as well as Q1 2024,” Aurojyoti Bose, Lead Analyst at GlobalData, told businessline.

The value of the deals in India in the first quarter is not available.

• Also read: Funding winter turns harsher; global startup hubs hit by poor VC fund flow

Bose said the US was experiencing a month-on-month fluctuating trend in 2024. While February 2024 experienced a rebound in deal activity after months of decline, March witnessed a fall in VC deals volume and value.

“Despite the fluctuations or decline, the US continues to dominate the global VC funding landscape,” he said.

It accounted for 27.8 per cent share of the total number of VC funding deals announced globally during the quarter while its share of the corresponding deal value stood at 42.6 per cent , reflecting its dominance in the investment landscape.

New unicorns

Some of the notable venture funding deals announced in the US during the Q1 2024 included $700 million worth of funding raised by Wonder, $675 million secured by FigureAI, and $400 million worth of funding raised by Mirador Therapeutics.

“With notable deals propelling new unicorns, the stage is set for a year of resilience and evolution. Looking ahead, while challenges persist, the underlying innovation and investor interest suggest a landscape ripe for further growth and transformative deals in the remainder of the year,” he said.

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