What Slowdown? Strong Private-Company Funding Pace Continues Into 2022 Despite Market Turmoil

Gené Teare @geneteare

With the current volatility in the public markets, paused public debuts, rumors of private-company financing term sheets being renegotiated, and pandemic restrictions slowly lifting, there are a lot of questions about what the venture funding market will look like this year.

But while the startup funding environment in 2022 could look very different from 2021—the year new records were set across almost every benchmark for venture funding—January, at least, remained very strong.

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Despite the tumult, global funding to private companies last month clocked in at $61 billion, the fourth month above the $60 billion mark in the last 12 months, per Crunchbase data.

Close to $3 billion was invested globally at seed last month. Startup investors spent another $18 billion at early stage and just over $40 billion at the later stage and technology-growth stage, according to Crunchbase data.

New unicorns

On the unicorn front, 45 companies joined the Crunchbase Unicorn Board in January, matching the new unicorn count for December 2021, and up slightly compared to January 2021, when 43 new unicorns were minted. The Crunchbase Board now has just under 1,200 companies that have collectively raised $704 billion and are altogether valued above $4 trillion for the first time.

Unicorn fundings

In keeping with recent trends, some of the largest fundings went to European unicorns:

Payments company Checkout.com from London bagged a $1 billion Series D valuing the company at $40 billion, making it the second-most highly valued European private company on the board; and
Estonia-based delivery company Bolt raised $709 million in a Series F round.

Other new unicorn fundings included:

India-based food delivery platform Swiggy, which raised $700 million in a late-stage funding that values the company as a decacorn;
Toronto-based 1Password raised $620 million; and
Paris-based Qonto, a digital bank for SMBs and freelancers, closed on a $550 million Series D.

Growth equity continues to lead

Growth equity continued its lead in January 2022 by funding counts led and dollars invested.

Investors leading or co-leading the largest fundings last month included Tiger Global Management, Sequoia Capital and SoftBank Vision Fund.

The firms with the highest count of rounds led in January were Tiger Global, Insight Partners, Sequoia Capital India, the SoftBank Vision Fund and Andreessen Horowitz, each with more than 10 fundings led.

Larger funds raised as venture capital is changing

Andreessen Horowitz closed on a host of new funds last month, with fund 8 at $2.5 billion, bio fund 4 at $1.5 billion, and growth fund 3 of $5 billion. Fintech investor Ribbit Capital closed on fund 7, totaling just under $1.2 billion and marking its first billion-dollar fund.

Other firms that closed on funds include Kleiner Perkins, Khosla Ventures, Foundation Capital, Blossom Capital and Cherry Ventures, among others.

Sequoia Capital and crypto investor Paradigm invested in market maker Citadel Securities, further linking alternative investments in crypto alongside public market investing for venture investors.

In the past week, the public markets for technology stocks have begun to rally. Microsoft, Alphabet, Apple and Tesla all reported strong fourth-quarter earnings, prompting their shares to rise. The earlier correction might well be overstated, which would be good news for late-stage private financings.

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Funding and exits

Unicorn queries

Methodology

Funding rounds included in this report are seed, angel, venture, corporate-venture and private-equity rounds in venture-backed companies. This reflects data in Crunchbase as of Feb. 2, 2022.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Illustration: Dom Guzman

Correction: This article was updated on Feb. 9, 2022 to correct the investors listed as leading or co-leading the largest fundings in January. The chart titled, “Investors That Led Or Co-led By Amounts In January 2022” was also updated with new funding amounts and counts.