TLDR:
- Global venture capital dealmaking is struggling due to inflation, interest rates, and macro uncertainty.
- Exits are slow, fundraising figures are low, and deal activity in Latin America is at its slowest since 2018.
The first look at the dealmaking environment for venture capital in the second quarter of 2024 reveals continued struggle, according to the Venture Monitor report by Pitchbook and the National Venture Capital Association. Lead analysts from both organizations highlighted the challenges faced by the global VC market, including:
Global VC activity by region has been impacted by inflation, interest rates, and macro uncertainty, leading to a decrease in VC dealmaking. Fundraising figures have been slow, pacing for the lowest total commitments since 2015, with the market facing a lack of middle and large-sized M&A deals. Latin America is experiencing a slow year in dealmaking, while the U.S. has seen an increase in deal activity on a count basis, although exit activity remains weak.
Europe, on the other hand, has shown resilience in its VC activity with an uptick in deal value despite fewer deals. Exit activity in Europe remains thin, with the potential to reach a decade-low in exit value by the end of the year. Fundraising in Europe has been solid, albeit slightly down from 2023 levels, with major fund families managing to boost figures in the region.
