Mattermark data shows US venture is slowing down – Europe may be insulated

Stage-by-Stage Change in US Venture Capital Deployed (Deal Value) – Mattermark

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Stage-by-Stage Change in US Venture Capital Deal Volume – Mattermark

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Mattermark just released data for deal volume and value in the US in May. As you can see the trend is down, particularly in Seed and Series A. Moreover, as they point out these are lag measures because they report announced deals and deals are often announced 6-12 weeks after completion.

The implication is that Seed and Series A have been in slowdown for 3-5 months now.

The Q1 data for Europe showed investment was flat on Q4, but it will be interesting to see if we see the same declines as the US in April and May. Anecdotally it feels to me that activity is slowing here, but the slowdown isn’t as marked as in the US. That wouldn’t be surprising given that the ramp up in investment activity here in 2013-2015 was less pronounced.

Whatever your view on which way the market is likely to move it makes sense to plan for a difficult fundraising climate over the next 12-24 months. That means having an option of getting to profitability (where possible), allowing extra time to raise money, making existing funds last long enough to achieve significant progress (18 months) and focusing on unit profitability. Plan for the worst, hope for the best.