PitchBook and Collision Unveil Fifth Venture Investor Survey at 2022 Conference

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Jun 20, 2022, 09:00 ET

Results Show Sentiment Towards Investing, Emerging Technologies & Areas of Impact

SEATTLE, June 20, 2022 /PRNewswire/ -- PitchBook, the premier data provider for the private and public equity markets, today released the findings from a new survey conducted in partnership with Collision Conference, a Web Summit event and North America's fastest growing technology conference taking place in Toronto June 20-23, 2022. The survey was administered to 105 venture capital (VC) investors attending Collision. This is the fifth survey PitchBook and Web Summit have partnered on and offers a glimpse at how investment activity has fared compared to 2021, investor sentiment towards technology and focus areas for impact. At Collision, PitchBook is sponsoring the Investor Lounge where investors in attendance can work, take meetings and network. PitchBook senior VC analyst, Kyle Stanford, is a keynote speaker presenting global VC trends at the conference on June 21 at 11:45 AM EDT.

The global VC industry has more than $500 billion in dry powder available with VC consistently showing best returns of private investment strategies, driving more interest and capital. European VC deal value started 2022 with strong momentum reaching €27.5 billion invested in the first quarter of the year while U.S. investment activity did not maintain its pace after a record-setting 2021, reaching $70 billion invested during the same timeframe. The VC industry overall has displayed unwavering resilience throughout the pandemic.

"It is a strong signal of market stability that nearly half of investors polled do not plan on slowing down investment activity. Recent fundraising records have driven dry powder levels to new heights, which can provide short-term insulation from global market headwinds," said Kyle Stanford, senior VC analyst at PitchBook. "It's encouraging to see the majority of survey respondents have made first-time investments over the past twelve months – an area of the market that slowed during the pandemic – and we expect to continue to see a strong startup ecosystem."

"Despite a decrease in startup valuations, venture capital deal making remains strong — especially if VC dry powder stays robust — and potentially makes smaller cheques at lower valuations more available," said Paddy Cosgrave, founder and CEO at Collision and Web Summit. "Alternatively, many less renowned venture funds might simply shutter because the actual pool of viable startups available for them to invest in may be significantly lower than the outsized amount of capital available in the broader market."

Key findings and comparisons with 2021's Web Summit survey include:

Investment

In the past twelve months, over half of investors (53%) have made between one and five investments, down from two thirds of respondents in 2021. 30% of respondents have made between six and ten investments. Out of those investments, nearly one third of investors said at least 75% of their investments were first-time financings.
First-financings have continued to close at a historically high rate in 2022 following 2021's momentum. With more than 1,000 deals closed, Q1 finished with more companies raising their first institutional capital than any quarter prior to 2021.
Considering nontraditional investments, 59% of respondents agreed record levels of capital from nontraditional sources including corporate venture capital (CVC) and financial institutions has been the main driving force behind increased deal sizes. A quarter (26%) of respondents disagreed with this sentiment, which is an 8% increase from 2021.

Evaluation

When asked what the most important criterion respondents look at when evaluating investment opportunity, executive team pedigree moved to the top (26%) followed by business model (25%). In 2021, the two were swapped with business model ranked first (30%) followed by executive team pedigree (22%).
Half of respondents agreed that growth must come before profit for VC-backed technology startups while nearly one third disagreed.
Majority of respondents (83%) either agreed or strongly agreed increased deal sizes across financing stages are pushing up valuations and making it harder to find good value-for-money investments.
When evaluating external pressures facing the VC ecosystem such as public market volatility, increasing interest rates and talent market shifts, nearly half (45%) of respondents disagreed that their investment activity will markedly decrease from recent years.

Opportunity

Emerging technologies continues to attract capital from investors and when asked what category has the potential to be most disruptive in the next five to ten years, fintech remained at the top at 30%. Artificial intelligence and machine learning came in second (27%) over taking climate tech (15%), which came second in 2021.
According to respondents, over half (58%) selected North America as the most exciting region to invest in right now. After North America, Africa and Asia Pacific tied for second.
When asked where VC investors should focus their attention to have the most impact, improved long-term investment moved to the top (26%). In 2021, environmental and social concerns was the top choice, which moved to second.

For more information about PitchBook, click here.

About PitchBook
PitchBook is a financial data and software company that provides transparency into the capital markets to help professionals discover and execute opportunities with confidence and efficiency. PitchBook collects and analyzes detailed data on the entire venture capital, private equity and M&A landscape—including public and private companies, investors, funds, investments, exits and people. The company's data and analysis are available through the PitchBook Platform, industry news and in-depth reports. Founded in 2007, PitchBook has offices in Seattle, San Francisco, New York, London and Hong Kong and serves more than 70,000 professionals around the world. In 2016, Morningstar acquired PitchBook, which now operates as an independent subsidiary.

About Collision
For two years in a row, Collision – North America’s fastest-growing technology event – moved online. Making the pivot to host thousands of attendees online was referred to by the Sunday Times as a “pretty big experiment”. Now, Collision is returning in person to host the largest international event in Toronto in more than two years, with 33,000-plus attendees anticipated at Collision in the Enercare Centre from June 20-23, 2022.

About Web Summit
Forbes says Web Summit is “the best tech conference on the planet”. Bloomberg calls it “Davos for geeks”; Politico “the Olympics of tech”; the Guardian “Glastonbury for geeks”. In the words of Sky News, Web Summit is “the world’s most influential tech event”, and the Telegraph calls it the “planet's best tech conference”.

SOURCE PitchBook