Venture capital in the U.S. has hit new high records of investment, according to the latest VC report from PitchBook-NVCA Venture Monitor released today.
The jump was riven by an explosion of mega-deals and record nontraditional investor participation, as investment totals in the quarter broke all previous records.
Venture capital deals in the quarter hit $82.8 billion across an estimated 3,518 deals in the third quarter. That brings year-to-date totals to $238.7 billion across 12,837 deals, surpassing the previous annual record of $166.4 billion set in 2020.
Nontraditional investors participated in deals responsible for 77% of total year-to-date investment value. The Pitchbook report notes that their involvement is even more pronounced when looking at mega-rounds, with 88% of deals receiving nontraditional investor backing.
Megadeals, those with investment rounds of over $100 million, have risen sharply year-to-date, with 597 deals over $100 million compared with only 333 for the whole of 2020. Rounds of over $100 million now count for 57% of all venture capital deals.
The staggering growth in VC investment accompanied a notable increase in venture capital funds. There were 161 new venture capital funds in the third quarter, with the total across all VC funds hitting $96 billion across 526 funds.
Exit activity for the year to date has also smashed all records. Exits, meaning acquisitions or initial public offerings of stock, have brought in $582.5 billion in liquid value across 1,150 deals in just nine months — surpassing $500 billion for the first time and doubling 2020’s previous record.
IPOs accounted for 88% of the total exit value at $513.6 billion. An open IPO window and increase in special-purpose acquisition company or SPAC business combinations pushed the third-quarter public listing total to 93, with Robinhood’s $30 billion debut the largest.
“There is no denying that the startup ecosystem is powering America’s economic comeback,” NVCA Chief Executive Officer Bobby Franklin said in a statement. “Lawmakers in Washington who are looking for ways to enhance our economic future should check out these record-shattering numbers. The VC industry is this country’s biggest job engine, and we have the numbers to back it up.”
Amid the COVID-19 pandemic, global shutdowns and now unprecedented stress on the global supply chain, the figures are staggering. Whether it ends with a post-Roaring Twenties bang or more of a whimper remains to be seen.