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January 12, 2024
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Declining Value Threatens 4Q Venture Capital Endeavors in Region

TLDR:

  • The number and value of venture capital deals in the Seattle-Tacoma-Bellevue metro area in the fourth quarter of 2023 fell from the previous year and the previous quarter.
  • The Seattle region’s VC activity reflects the national decline in venture capital deals and investments.
  • The industry is well capitalized, and sectors such as artificial intelligence, life sciences, and clean technology are attracting significant investment.

The Seattle-Tacoma-Bellevue metro area saw a decline in the number and value of venture capital deals in the fourth quarter of 2023, according to data from PitchBook and NVCA. The metro area recorded 81 deals valued at $762 million, down from $2.4 billion and 107 deals in the same quarter of the previous year, and $1.1 billion and 88 deals in the previous quarter.

The biggest Eastside deals in the fourth quarter were Chainguard, a Kirkland cybersecurity company, which raised $61 million in a Series B funding round; Pandion, a Bellevue-based technology-powered shipping network for e-commerce, which raised $50.9 million in a Series B round; and Rain City Capital of Kirkland, a hard money lender, which raised $45.4 million in later stage VC.

The decline in VC activity in the Seattle region reflects the national trend, with the US seeing a decrease in both the number and value of VC deals. On a national scale, there were 2,879 deals valued at $37.5 billion in the fourth quarter, down from the previous year and the previous quarter.

Despite the decline in deals and investments in 2023 compared to 2022, the industry is still well capitalized. The executive summary in the fourth quarter PitchBook NVCA Venture Monitor report highlights that advances in artificial intelligence, life sciences, and clean technology are attracting significant public and private investment.

The report also indicates a need for new capacity in fields like manufacturing and materials processing to de-risk existing supply chains and support the green transition. The executive summary concludes that the VC community in the US has a responsibility to ensure that these changes leave the world in a better state.

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