TLDR:
- PE, VC funding slows down in the first half of 2024
- Secondary deals become prominent
Key Points:
Secondary stake sales and buyouts dominated large deals in the startup space during the first six months of 2024, with 62% of deals falling in the $50-500 million range being secondary transactions or buyouts.
Total funding for startups fell by 3.8% to about $5.1 billion in the first half of 2024 compared to the same period in 2023. Venture capital investors are increasingly demanding partial exits from late-stage startups, leading to a significant increase in secondary transactions.
Companies with strong unit economics are looking to close secondary transactions in preparation for potential initial public offerings. Secondary stake sales and buyouts dominated large deals of $50-500 million in the startup space during the first six months of 2024, when total funding fell but late-stage activities started to pick up pace.
According to data from investment banking firm DC Advisory India, 62%, or 23, of the 37 deals in the $50-500 million range during the January-June period were secondary transactions or buyouts, with external primary investment rounds making up only 13%.
