Venture Pulse q2 2022

Global analysis of venture funding
July 20, 2022

Welcome to the Q2’22 edition of KPMG Private Enterprise’s on the public markets. With valuations dropping, cash
Venture Pulse — a quarterly report spotlighting the major trends, preservation is rapidly becoming a priority for companies. While
challenges, and opportunities facing the venture capital market there continues to be dry powder in the market, VC investors are
globally and in key jurisdictions around the world. becoming more conservative, focusing more on profitability when You know KPMG. You might not know
KPMG Private Enterprise.
making investment decisions.
Global VC investment and the number of VC deals declined in
Q2’22 amid ongoing geopolitical uncertainties, supply chain With no end in sight to the global uncertainty, the IPO window is KPMG Private Enterprise advisers in
issues, and increasing inflation and interest rates. VC investment expected to remain firmly shuttered and VC investment is KPMG firms around the world are
in the US showed the most resilience, led by a $2 billion raise by expected to remain soft in Q3’22. The VC market is likely to see dedicated to working with you and your
Epic Games, a $1.7 billion raise by SpaceX and a $1.5 billion down rounds as companies feel pressure despite the challenging business, no matter where you are in
raise by GoPuff. In Europe, VC investment dropped across most market conditions. M&A activity could see a bump as investors your growth journey — whether you’re
individual jurisdictions. Fintech, cybersecurity, and supply chain look for deals and companies in different industries consolidate in looking to reach new heights, embrace
management continued to attract significant investment from order to improve their market positions. technology, plan for an exit, or manage
investors, in addition to alternative energy and energy storage. the transition of wealth or your business
In this quarter’s edition of Venture Pulse, we examine these and a
While total investment might have declined, Europe continued to number of other global and regional trends, including:
to the next generation.
see a wide range of countries attracting large deals, including
Germany (Trade Republic — $1.15 billion), Switzerland • Declining investor interest in consumer-focused businesses,
Jonathan Lavender
(Climeworks — $650 million), the United Kingdom (SumUp — particularly in the Americas Global Head
$626.7 million), Croatia (Rimac Automobili — $528.7 million) and • Increasing focus of investors on profitability and cash KPMG Private Enterprise
KPMG International
Italy (Scalapay — $524 million; Habacus — $330 million). VC conservation
investment in Asia dropped for a second straight quarter, driven • Growing geographic diversification of deals in Europe and
by continued softness of investment in China and relatively Asia Conor Moore
smaller deal sizes. India-based Dailyhunt raised the largest round • Declining levels of CVC investment in many jurisdictions Head of KPMG Private Enterprise in the
Americas,
of the quarter in Asia ($805 million), followed by China-based • Increasing interest in alternative energy and battery storage Global Leader, Emerging Giants, KPMG
CanSemi ($671.8 million), Hong Kong (SAR), China’s Bavari Private Enterprise, KPMG International &
Natural Environment ($630 million) and Indonesia-based Xendit We hope you find this edition of Venture Pulse insightful. If you Partner, KPMG in the US
($300 million). would like to discuss any of the results in more detail, please
Lindsay Hull
contact a KPMG adviser in your area. Director, Emerging Giants Global
IPO activity stalled across the board during Q2’22, driven by Network, KPMG Private Enterprise,
declining valuations and the poor performance of tech companies KPMG International
Unless otherwise noted, all currencies reflected throughout this document are in US dollar.
© 2022 Copyright owned by one or more of the KPMG International entities. KPMG International entities provide no services to clients. All rights reserved. #Q2VC
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Global US
• VC investment slows to • VC deal value drops to $62.3 billion across
$120.2 billion across 8,420 deals 3,374 deals
• Up rounds continue at record • Up rounds continue as well as strong valuations
proportion • Angel & Seed investments increase as percentage
• Record dry powder supporting of deals
resilient valuations • First-time venture financings on pace for another
• Total exit value drops to lowest record year
levels in 2 years • VC fundraising continues at record pace
• United States home to 6 of top
10 deals globally
Asia
• VC investment drops to
$24.5 billion across
2,206 deals
Americas •
•
Corporates remain active
Sluggish fundraising in first
• VC-backed companies raise
half of year
$66.2 billion across 3,778 deals
• Venture financing in India
• Median deal size falls for
surpasses $6.5 billion for the
late-stage VC
4th consecutive quarter
• Valuations still hold at
• Top 10 deals spread between
record highs
• After historic year, Canadian
dealmaking drops in Q2
Europe China (5), India (4),
Indonesia (1), Singapore (1)
• Brazil experiences sudden drop • Investment strong in Europe — over $27.3 billion invested on 2,220 deals
in mega deals • Late-state holds strong as investors remain sanguine
• Top 10 deals all in the • Late-stage volume remains healthy
United States • First-time financings slow down; corporates remain active
• UK and German VC invested tallies remain healthy
• Top 10 deals spread among 6 countries
#Q2VC
© 2022 Copyright owned by one or more of the KPMG International entities. KPMG International entities provide no services to clients. All rights reserved.
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Global US | Americas | Europe | Asia
#Q2VC
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VC investment globally dropped to a 6 quarter low in Q2’22 amid the ongoing crisis in Ukraine, high levels of inflation, and rising interest
rates. With no end in sight to the uncertainty, VC investment could remain somewhat soft heading into Q3’22.
Largest mega deals limited to the US Supply chain and automation continue to attract attention
Both the number of deals and the total amount of VC investment dropped in the Americas, While investor interest in consumer-orientated businesses waned during Q2’22, interest remained
Europe, and Asia during Q2’22. VC investment in the US showed the most resilience, helped relatively high in a number of other sectors. Supply chain and logistics continued to attract a
by three $1 billion+ deals: a $2 billion raise by Epic Games, a $1.7 billion raise by SpaceX and significant amount of attention as companies looked for ways to address ongoing supply chain
$1.5 billion raise by GoPuff. The largest raises outside of the US included a $1.15 billion deal challenge. Piggy-backing off the focus on supply chain management, VC investors also showed
by Germany’s Trade Republic, an $805 million raise by India-based Dailyhunt, a $714 million continued interest in automated vehicles — from long-haul transportation to the development of
raise by Kitopi in the United Arab Emirates, and a $650 million raise by Switzerland-based automated vehicles for use in warehouses, on farms, and at other industrial or manufacturing sites
Climeworks. or facilities. Drone technologies have also remained firmly on the radar of VC investors.
Despite dry powder, global VC investors becoming more cautious Soaring energy prices driving attention to alternative energy
While there continues to be a reasonable amount of dry powder in the VC market globally, Skyrocketing energy prices in many regions of the world and growing concerns over energy
particularly in the US, the Americas more broadly, and Europe, VC investors are expected to dependencies helped drive investor interest in alternative energy options, energy storage, and
become more cautious with their investments, focusing on companies within their portfolios, mobility even higher in Q2’22. While electric vehicles and batteries continued to be a major focus
companies with strong paths to profitability, and companies in sectors being put in the spotlight for investment during the quarter, areas like hydrogen-based technologies also gained additional
by the current crisis in Ukraine. attention. Over the next few quarters, interest in other energy sources and solutions is also
expected to pick up — such as the development of small-scale nuclear plants in Europe.
VC investors pressure portfolio companies to focus on preserving cash to ride
out the storm IPO exits stall worldwide amid poorly performing public markets
A number of high-flying private companies saw their valuations drop in Q2’22 compared to After a strong run of IPO exits over the last 2 years, the IPO window has slammed shut,
6 months ago — a decline echoing the experience of many publicly traded tech companies particularly in the US but also in Europe and Asia. With valuations of many public technology
around the world. This is driving several global VC firms to direct their portfolio companies to companies down considerably, many companies that may have considered an IPO exit have
tighten their wallets, be more selective with their hiring plans, and rationalize their workforce now delayed their plans for the foreseeable future.
in order to ride out the current uncertainties. Many VC investors and startups view cash
While SPAC activity globally has been quiet in 2022, there continues to be many SPACs
preservation as essential in order to avoid down rounds and defer new funding rounds until
looking for targets, particularly in the US. Many of these SPACs will see their 2-year window of
the market turbulence improves.
opportunity closing within the next 12 months. This could drive some renewed activity over the
next few quarters, particularly if market conditions improve.
#Q2VC
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Unicorn status in jeopardy for some startups Trends to watch for in Q3’22
In Q2’22, there were 97 new unicorns birthed globally, with fintech companies representing Given the number of geopolitical and macroeconomic uncertainties affecting the VC market
more than a third. The Americas accounted for over half of the world’s new unicorns, with the globally, there will likely continue to be downward pressure on valuations, which could lead to
US hosting all but three in Latin America (Unico and Stark Bank in Brazil and Kushki in decreasing levels of investment. VC deals in many regions will likely take longer to complete
Ecuador). Europe saw 18 new unicorns come from 8 different countries (UK, Germany, as investors enhance their due diligence of deals.
Finland, Sweden, Norway, Netherlands, Switzerland, Israel), reflecting the incredible
geographic diversity of the European VC market. Asia also saw quite a geographic spread of Fintech will likely remain a strong area of investment in many jurisdictions around the world, in
new unicorns, with 17 coming from seven jurisdictions in Q2’22. addition to supply chain and logistics, cybersecurity, and alternative energy. Given rising
inflation and interest rates, consumer-focused companies will likely lose some luster with VC
While unicorn births remained steady during the quarter, there are concerns that down rounds investors in favor of B2B solutions and investments.
could cause unicorns with $1 billion valuations to lose their status. Unicorns valued at exactly
$1 billion could consider giving significant concessions to investors in order to retain their
unicorn status.
#Q2VC
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Venture investment slows but does not collapse
“
Global venture financing
2014–Q2'22
Midway through the year, it is clear that
A robust global economy
$250 14,000 although venture investment has slowed, it combined with changing
has not yet collapsed, despite significant consumer behavior sparked
turbulence across both markets and two years of explosive
12,000
economies. A recession seems increasingly
$200
likely across much of the world, which alone
growth in venture capital
10,000 would help explain caution on the part of investment around the
investors. However, there are still multiple world. However, recent
$150 factors that could continue to keep spurring geopolitical and economic
8,000
dealmaking, including:
concerns appear to have
• Significant levels of dry powder mean that finally turned the tide, as
6,000
$100 there is plenty of capital to dispense,
although fund managers are likely to
investors have started to pull
4,000 remain cautious and assess the ripple back and take caution,
$50
effects of economic slowing increasingly focusing their
2,000 • As high-profile markdowns are occurring, investments on companies
$107.5
$155.6
$173.8
$187.4
$207.2
$165.3
$120.2
$25.3
$32.2
$28.7
$33.6
$40.9
$41.3
$57.5
$38.7
$49.0
$60.7
$41.9
$38.0
$37.0
$49.5
$58.3
$56.7
$74.2
$91.7
$78.8
$94.6
$78.3
$70.3
$89.0
$79.4
$77.9
$71.4
$98.7
even the median level of valuations could with a clear path to
”
by and large also soften somewhat, profitability.
$0 0
leading investors to conclude pricing has
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corrected
2014 2015 2016 2017 2018 2019 2020 2021 2022
• The full extent of a recession’s impact is
Deal value ($B) Deal count Angel & seed Early VC Later VC yet to be determined but given sheer
volatility across public markets, it is likely
that investment will remain muted in the
back half of the year Jonathan Lavender
Global Head
KPMG Private Enterprise
Source: Venture Pulse, Q2’22. Global Analysis of Venture Funding, KPMG Private Enterprise. Data provided by PitchBook, July 20, 2022. KPMG International
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Global median deal size ($M) by stage Global up, flat or down rounds
2014–2022* 2014–2022*
$14 100%
90%
$12 $11.5
80%
$10 70%
60%
$8
50%
$6 $6.0
40%
$4 30%
20%
$1.8
$2
10%
$0 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Angel & seed Early VC Later VC Down Flat Up
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022.
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Global median deal size ($M) by series

2014–2022*
$140
$120 $115.0
$100
$80
$60 $55.0
$40
$30.0
$20 $12.0
$2.2
$0 $0.5
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
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Global median pre-money valuation ($M) by series

2014–2022*
$1,200
$1,056.0
$1,000
$800
$600
$400
$325.0
$200 $130.0
$40.0
$9.7
$0 $4.3
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
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Global deal share by series Global deal share by series

2014–2022*, number of closed deals 2014–2022*, VC invested ($B)
100% 100%
90% 90%
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Series D+ Series C Series B Series A Angel & seed Series D+ Series C Series B Series A Angel & seed
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Global financing trends to VC-backed companies by sector Global financing trends to VC-backed companies by sector
100% Transportation 100%
90% Commercial 90%

Products & Services
80% 80%
Consumer Goods &
Services
70% 70%
Software
60% 60%
Pharma & Biotech
50% 50%
Other
40% 40%
Media
30% 30%
IT Hardware
20% 20%
HC Services &
10% Systems 10%
HC Devices &
0% 2022* Supplies 0%
2022*
2014
2015
2016
2017
2018
2019
2020
2021
2014
2015
2016
2017
2018
2019
2020
2021
Energy
#Q2VC
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Corporate VC participation in global venture deals Global first-time venture financings of companies
2014–Q2'22 2014–2022*
$120 3,000 $70 16,000
$60 14,000
$100 2,500
12,000
$50
$80 2,000
10,000
$40
$60 1,500
8,000
$30
$40 1,000 6,000
$20
$20 500 4,000
$12.7
$10.6
$13.5
$16.8
$18.1
$30.4
$16.6
$25.9
$38.6
$19.6
$16.8
$14.2
$20.7
$29.8
$23.1
$36.2
$55.7
$42.7
$47.0
$34.8
$32.3
$37.5
$38.5
$41.8
$35.4
$50.9
$52.4
$65.3
$78.8
$96.8
$99.6
$76.6
$49.7
$9.8
$10 2,000
$15.7
$28.0
$26.6
$23.5
$34.3
$34.5
$34.0
$64.5
$26.5
$0 0
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$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Deal value ($B) Deal count Deal value ($B) Deal count
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook,
July 20, 2022. July 20, 2022.
Note: The capital invested is the sum of all the round values in which corporate venture capital investors participated, not the amount that corporate
venture capital arms invested themselves. Likewise, deal count is the number of rounds in which corporate venture firms parti cipated.
Much like traditional venture firms, corporates and their venture arms are taking a bit of a Even amid significant volatility, first-time financings are flowing at a decent clip. Moreover, at
breather. Although full figures for Q2 2022 are likely to end up higher than the steep decline $26.5 billion in total deal value, 2022 is likely to be one of the strongest years on record in terms
above indicates, as businesses look to assess potential knock-on effects from any imminent of capital invested even in such fledgling rounds.
recession, it is possible they’ll pull back spend in key areas including joining in venture
financing activity.
#Q2VC
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Exits slow amid market volatility

Global unicorn rounds Global venture-backed exit activity
2014–Q2'22 2014–Q2'22
$80 300 $450 1,200
$70 $400
250 1,000
$350
$60
200 $300 800
$50
$250
$40 150 600
$200
$30
100 $150 400
$20
$100
50 200
$113.6
$113.4
$178.3
$173.1
$234.0
$351.3
$426.8
$294.4
$355.3
$10
$19.2
$12.1
$28.3
$11.8
$17.7
$13.4
$21.1
$28.5
$22.3
$38.2
$22.8
$18.9
$32.4
$23.9
$24.1
$19.8
$33.9
$32.6
$58.3
$65.7
$69.0
$69.3
$49.0
$32.8
$28.4
$73.0
$30.6
$73.7
$22.9
$35.9
$32.8
$43.5
$32.9
$26.1
$67.3
$22.0
$46.2
$38.2
$35.9
$67.7
$29.9
$53.9
$62.8
$84.7
$57.8
$45.8
$72.1
$77.0
$50.8
$50
$3.5
$5.9
$4.5
$7.7
$8.8
$7.6
$7.7
$7.3
$3.7
$4.3
$0 0 $0 0
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2014 2015 2016 2017 2018 2019 2020 2021 2022 2014 2015 2016 2017 2018 2019 2020 2021 2022
Deal value ($B) Deal count Exit value ($B) Exit count
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, Note: Exit value for initial public offerings is based on post-IPO valuation, not the size of the offering itself.
July 20, 2022.
Note: PitchBook defines a unicorn venture financing as a VC round that generates a post-money valuation of $1 billion or more. These are not necessarily first- Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook,
time unicorn financing rounds, but also include further rounds raised by existing unicorns that maintain at least that valuation of $1 billion or more. July 20, 2022.
Even as high-profile unicorn valuation markdowns occur, there still also are a stream of After a record-breaking year, reversion was likely regardless of gloomy economic forecasts
financings and unicorn creations occurring, even if the first half of 2022 has experienced some and surges in market volatility. That said, it is possible that as valuations normalize, acquirers
slowing relative to the record rates in 2021, which was an outlier year in many ways. eventually get eager to strike what could be seen as bargains.
#Q2VC
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Global venture-backed exit activity (#) by type Global venture-backed exit activity ($B) by type
2014–2022* 2014–2022*
4,500 $1,600
4,000 $1,400
3,500
$1,200
3,000
$1,000
2,500
$800
2,000
$600
1,500
$400
1,000
$200
500
0 $0
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Acquisition Buyout Public listing Acquisition Buyout Public listing
As markets continue to experience significant upticks in volatility, it remains to be seen if public listings will regain some vigor as late-stage unicorns ultimately opt to go public regardless. As many
raised large sums last year in order to do so, they very well could have the financial wherewithal to still debut. That said, M&A seems set to be the primary driver of exits volume for the remainder of
the year.
#Q2VC
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Global venture fundraising

2014–2022*
Allocators worldwide continue to flock to alternative investments — venture is
$300 2,500
no exception. Even after a record 2021, there still is significant appetite for
exposure to the asset class, with massive inflows of capital commitments even
$250 across fewer funds than normal. Large, experienced VCs still have no trouble
2,000 raising, it’s clear.
$200 Allocators continue to pile into the venture

1,500
asset class, waving away current concerns,
$150
with nearly $160 billion already raised.
1,000
$100
500
$50
$137.4
$168.0
$176.1
$185.1
$224.4
$199.8
$252.2
$158.6
$76.1
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Capital raised ($B) Fund count
#Q2VC
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Global venture fundraising (#) by size Global first-time vs. follow-on venture funds (#)
2014–2022* 2014–2022*
100% 100%
90% 90%
80% 80%
70% 70%
60% 60%
50%
50%
40%
40%
30%
30%
20%
20%
10%
10%
0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022*
$1B+ $500M-$1B $250M-$500M $100M-$250M $50M-$100M Under $50M
First-time Follow-on
#Q2VC
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Top 10 global financings in Q2'22
1. Epic Games — $2B, Cary, US — Entertainment software — Late-stage VC
2. SpaceX — $1.7B, Hawthorne, US — Aerospace — Late-stage VC

4
3
5 9 1 7 3. Gopuff — $1.5B, Philadelphia, US — Internet retail — Late-stage VC
2 8 10
4. Trade Republic — $1.15B, Berlin, Germany — Fintech — Series C
6
5. Faire — $816M, San Francisco, US — E-commerce — Series G
6. Dailyhunt — $805M, Bengaluru, India — Consumer — Series J
7. Ramp — $748.3M, New York, US — Fintech — Series C
8. Kitopi — $715M, Dubai, United Arab Emirates — Foodtech — Series C
9. The Boring Company — $675M, Burlingame, US — Infrastructure — Series C

Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by
PitchBook, July 20, 2022.
10. CanSemi — $671.8M, Guangzhou, China — Manufacturing — Early-stage VC
#Q2VC
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Global US Americas | Europe | Asia
#Q2VC
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Despite a decline in VC funding during Q2’22, the VC market in the US showed resilience during the quarter, with investment
higher than in any quarter prior to Q1’21. The quarter included two $1 billion+ funding rounds, including a $2 billion raise by Epic
Games, a $1.7 billion raise by SpaceX and a $1.5 billion raise by GoPuff.
Fundraising activity on record pace at mid-year VC investor interest in consumer-orientated businesses fell in the US during Q2’22, in part due
to the declining valuations of public companies in the space, in addition to rising inflation and
Fundraising activity in the US remained robust in Q2’22, with the amount of funds raised interest rates. A small number of companies managed to buck this trend, including wholesale
already closing in on the 2021 annual record-high of $140 billion at mid-year. Current market marketplace company Faire, which raised $816 million during the quarter.
conditions have prompted some LPs to reallocate funds to make certain their asset class
allocations are aligned; such changes, however, have not yet had an effect on the flow of IPO market remains shuttered in Q2’22
capital to the VC market. Top tier VC firms in particular have not experienced any difficulty
raising new funds. The IPO exit door in the US remained firmly shuttered in Q2’22, a sharp contrast to the record-
shattering IPO results seen throughout 2021. With market uncertainty high and no end in sight
Startups focusing on reducing cash burn to the Russia-Ukraine conflict, IPO exits are expected to remain stalled into Q3’22. M&A
activity, however, is well positioned to grow as acquirers look to take advantage of the decline
With the inflation rate soaring, interest rates on the rise, and growing indications that the US is in valuations to make more affordable deals. PE activity could also increase as companies
entering a recession, startups at all levels of maturity in the US are evaluating their operations flounder or fail to raise new funding rounds.
and moving to rein in their cash burn. During Q2’22, companies started reconsidering their
growth strategies, adjusting their headcount and, in the case of many consumer-focused Potential for down rounds increases
businesses, looking at ways to improve and enhance their unit economics. Many VC investors
have also directed their portfolio companies to focus on cash preservation in order to delay While there was not a significant number of down rounds in the US during Q2’22, the
their need for new funding or to support their operations while waiting for the IPO market to downward pressure on valuations combined with the ongoing uncertainty in the market could
reopen. see companies looking at accepting down rounds heading into Q3’22 or considering more
costly alternative financing vehicles in order to bridge funding gaps until market conditions
Cybersecurity and supply chain companies continue to attract attention hopefully improve. The possibility for down rounds and demands for downside protections (e.g.
ratchets) will likely be of most concern to US startups that were planning on holding an IPO exit
Given the ongoing uncertainty related to the crisis in Ukraine and growing concerns related to in 2022, but had to delay due to the market volatility — and to companies expected to be hit
potential cyberattacks, VC investment in cybersecurity in the US held strong in Q2’22 and is hard by a recessionary environment.
well-positioned to remain hot heading into Q3’22. Companies focused on helping companies
manage supply chain issues also continued to attract VC investment.
#Q2VC
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Narrow focus for ESG investments as investor priorities shift Valuations are expected to remain soft in Q3’22. Companies in industries like alternative
energy, cybersecurity, and supply chain management will likely remain attractive to investors,
Alternative energy, electric vehicles, and better storage continued to attract VC investment in while discretionary consumer-focused companies will likely lose their luster.
the US during Q2’22. While these areas are likely to remain attractive to VC investors in Q3’22,
other environmental, social and governance (ESG) areas could see a decline in investment as The IPO market will likely remain closed in Q3’22, although M&A activity could increase as
both companies and investors juggle rapidly rising input costs, supply chain challenges, and investors look to take advantage of the drop in valuations to make acquisitions and some
other immediate concerns. Despite any short-term decline in investment, ESG solutions as a industries see companies consolidating to improve their market position.
whole are expected to remain a key priority over the longer term.
Trends to watch for in Q3’22

Heading into Q3’22, VC investment in the US could dip — a trend not unexpected given most
summer quarters in the US see a decline in activity as a significant number of VC market
participants take vacations. The current geopolitical uncertainty and macroeconomic
environment could also negatively impact the level of VC investment.
#Q2VC
21
“
Venture financing in the US
2014–Q2'22
Companies in the US are
It is likely that Q2 figures tick upward in
$100 5,000 really starting to tighten their
coming months as more data comes to
light, but in any case, a slowdown in the belts. Almost everyone is
$90 4,500 pace of financing is only to be expected going to need to hunker down
given economic and market trends. There is and ride this out for however
$80 4,000 talk of term sheets being pulled and
long it will last... and that’s still
valuations being marked down, with some
$70 3,500 occurring at a relatively high profile. That the $64,000 question: how
said, there still is plenty of capital sloshing long is this going to last? It’s
$60 3,000 around that is waiting to be dispensed, so not clear yet. Although there
what the rest of the year holds is not quite
$50 2,500
will certainly be some
clear when it comes to how much funding
rates may actually decline. outliers... cybersecurity will
$40 2,000 likely buck any downward
trends, along with anything
$30 1,500
that’s embedded in solving
”
$20 1,000 supply chain issues.
$10 500
$15.0
$21.9
$17.2
$19.3
$21.2
$21.4
$23.1
$20.5
$20.8
$26.7
$18.9
$16.8
$18.3
$22.3
$24.9
$23.1
$30.1
$31.7
$34.7
$48.1
$39.4
$36.0
$38.4
$32.3
$38.2
$36.8
$47.5
$44.6
$77.0
$81.2
$88.9
$94.4
$81.9
$62.3
$0 0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2014 2015 2016 2017 2018 2019 2020 2021 2022
Conor Moore
Head of KPMG Private Enterprise in the
Deal value ($B) Deal count Angel & seed Early VC Later VC Americas,
Global Leader, Emerging Giants, KPMG
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. Private Enterprise, KPMG International &
Partner, KPMG in the US
#Q2VC
22
Median deal size ($M) by stage in the US Up, flat or down rounds in the US
2014–2022* 2014–2022*
$16.0 100%
90%
$14.0 $14.0
80%
$12.0
70%
$10.8
$10.0
60%
$8.0 50%
40%
$6.0
30%
$4.0
20%
$2.0 $2.1
10%
$0.0 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Angel & seed Early VC Later VC
Down Flat Up
#Q2VC
23
“
Median deal size ($M) by series in the US
2014–2022* After months of relative immunity
$140 to market turmoil, Series A and
Seed stage deals are starting to
$125.0 feel pricing pressure. VC firms
$120 are beginning to demand that
companies show more robust
$100
revenue before seeking a Series
A round. So, companies that got
a good seed round with the
$80 expectation that they would be
going to market for a Series A
round within a prescribed
$60 $60.0
timeframe are now having to hold
on for longer than expected. This
is likely forcing them to rethink
”
$40
$33.2 their spending very quickly.
$20
$14.0
$0 $0.3 $2.6
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
Jules Walker
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. Senior Director
Business Development
Note: Figures rounded in some cases for legibility.
KPMG in the US
#Q2VC
24
Median pre-money valuation ($M) by series in the US

2014–2022*
$1,200
$1,000 $1,020.0
$800
$600
$400
$315.0
$200
$150.0
$42.1
$0 $3.8 $11.0
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
Note: Figures rounded in some cases for legibility.
#Q2VC
25
Deal share by series in the US Deal share by series in the US

100% 100%
90% Series D+ Series D+

90%
80% 80%
70% 70% Series C

Series C
60% 60%
50% 50%
Series B Series B
40% 40%
30% 30%
Series A Series A
20% 20%
10% 10%
Angel & seed Angel & seed

0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
26
Venture financing by sector in the US Venture financing by sector in the US

100% 100%
Transportation
90% 90%
Commercial Products
& Services
80% 80%
Consumer Goods &
Services
70% 70%
Software
60% 60%
Pharma & Biotech
50% 50%
Other
40% 40%
Media
30% 30%
IT Hardware
20% 20%
HC Services &
10% Systems 10%
HC Devices &
0% Supplies 0%
2022*
2014
2015
2016
2017
2018
2019
2020
2021
2022*
2014
2015
2016
2017
2018
2019
2020
2021
Energy
#Q2VC
27
“
Corporate participation in venture deals in the US First-time venture financings of companies in the US
2014–Q2'22 2014–2022* I would argue that the VC
$45 900
market went through a blip
$30 6,000
up and is currently going
$40 800 through a blip down. Over
$25 5,000 the past two years, the
$35 700
private markets have seen
$30 600
an incredible amount of
$20 4,000
funding. Cash was
$25 500 effectively free — at least
$15 3,000 on the corporate side —
$20 400
and so there was a lot of
$15 300
money coming in and
$10 2,000
chasing yield. Now, as that
$10 200 liquidity gets pulled out of
$5 1,000 the system, things are
$5 100
going back to a more
”
$10.8
$15.1
$12.7
$15.3
$16.6
$25.7
$15.2
$15.3
$16.7
$11.1
$18.6
$18.1
$22.6
$18.4
$33.3
$36.2
$39.5
$40.5
$33.5
$23.6
$15.6
$15.0
$15.1
$25.2
$14.0
$5.3
$8.6
$5.6
$7.4
$8.9
$8.8
$8.7
$9.4
$7.8
$6.3
$6.3
$8.5
$9.8
$9.2
$8.0
$9.5
$9.2
$9.5
$0 0
normal state of affairs.
$0 0
Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 2014 2015 2016 2017 2018 2019 2020 2021 2022*
2014 2015 2016 2017 2018 2019 2020 2021 2022
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30,
PitchBook, July 20, 2022. 2022. Data provided by PitchBook, July 20, 2022.
Peter Kehrli
Partner
KPMG in the US
#Q2VC
28
Venture-backed exit activity in the US

2014–Q2'22
Nobody cares to catch a falling
$300 600 knife, and listing publicly in a
volatile market usually makes
companies shy away. Thus, in the
$250 500 US, exit volume has declined
considerably, as even M&A levels
are not as robust as they were last
year. That said, acquirers could
$200 400 grow more bold should valuations
normalize somewhat. In addition,
unicorns may finally opt to go
$150 300 public regardless of market
volatility, given their overarching
timelines and relative levels of
preparation.
$100 200
$50 100
$148.4
$105.4
$170.5
$122.4
$267.6
$193.4
$193.9
$23.4
$23.3
$21.0
$44.8
$12.3
$19.1
$23.6
$22.0
$19.1
$18.3
$22.0
$10.8
$33.5
$20.6
$16.2
$31.4
$19.5
$33.6
$34.9
$36.8
$51.0
$45.2
$24.1
$17.9
$30.8
$35.7
$13.1
$0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2014 2015 2016 2017 2018 2019 2020 2021 2022
Exit value ($B) Exit count
#Q2VC
29
Venture-backed exit activity (#) by type in the US Venture-backed exit activity ($B) by type in the US
2014–2022* 2014–2022*
2,000 $900
1,800 $800
1,600 $700
1,400
$600
1,200
$500
1,000
$400
800
$300
600
$200
400
200 $100
0 $0
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
30
US venture fundraising
2014–2022*
At this stage of the venture ecosystem’s maturation, the market size is such that there are
$160 1,200
sufficient investment opportunities for LPs to make plenty of commitments. And despite any
ongoing market turbulence, the pace of commitments keeps flowing at a record rate, to such
$140 an extent that this year may very well see a new annual high in capital committed.
1,000
$120
… no slowdown has occurred in the slightest in
fundraising’s pace; instead 2022 has already
800
$100
surpassed $120 billion in capital

$80 600
commitments.
$60
400
$40
200
$20
$138.9
$121.5
$38.0
$43.5
$51.5
$44.3
$60.6
$70.5
$85.4
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
31
Venture fundraising (#) by size in the US Venture fundraising ($B) by size in the US
2014–2022* 2014–2022*
100%
100%
90% 90%
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
$1B+ $500M-$1B $250M-$500M $100M-$250M $50M-$100M Under $50M $1B+ $500M-$1B $250M-$500M $100M-$250M $50M-$100M Under $50M
#Q2VC
32
First-time vs. follow-on funds (#) in the US First-time vs. follow-on funds ($B) in the US
2014–2022* 2014–2022*
100% 100%
90% 90%
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
First-time Follow-on First-time Follow-on
#Q2VC
33
Global | US Americas Europe | Asia
#Q2VC
34
VC investment declined in the Americas in Q2’22, particularly in jurisdictions outside of the US, including Canada and Brazil.
VC investors focusing on due diligence and profitability Crypto tide starting to turn
Late in Q1’22, the recessionary climate in the US began to affect the VC market, with late- In the Americas, the crypto and blockchain space initially showed some immunity to the
stage unicorns the first to feel downward pressure on their valuations. During Q2’22, the valuation and funding corrections taking place during Q2’22; however, this has started to
impact broadened, with companies raising seed and Series A rounds also seeing their change — with crypto firms now trying to cope with a major sell-off of crypto assets. During
valuations drop considerably. This is driving VC investors both in the US and elsewhere in the Q2’22, US-based BlockFi saw its valuation drop to $1 billion; it is now in the process of raising
Americas to evaluate potential deals more rigorously, rather than investing because of a fear a down round in order to obtain needed capital. The sudden tightening of the crypto space will
of missing out — a predominant trend during much of 2020 and 2021. Heading into Q3’22, likely drive consolidation among crypto firms heading into Q3’22 as the best firms rise to the
funding rounds will likely take more time to complete. Companies at early deal stages will likely top and others get left behind.
require stronger business cases and revenue models to attract investors, while VC investors
will likely conduct more robust due diligence on potential deals. Declining valuations could see VC investors looking for good deals
CVC investment declines across Americas Given the downturn in the public markets and the pressure on valuations, IPO activity in the
Americas remained at a standstill in Q2’22. With IPO activity not expected to rebound until
During Q2’22, CVC investment in the Americas dropped from the high levels seen over the market conditions improve, the VC market is quickly tilting from a seller’s market to one more
past 5 quarters. The decline likely reflects a combination of factors, such as corporates favorable to investors. Some VC — and PE — investors will likely look to take advantage of
focusing on their core operations in light of current uncertainties, pulling back on funding to current market conditions to make investments or acquire companies at better valuations and
their VC arms, and reducing investments in startups that are not seen as strategic priorities. In with better deal terms than 6-12 months ago.
Q3’22, corporates will likely focus predominantly on making strategic VC investments aimed at
complementing their core businesses. Number of VC deals plummets in Canada
Both the number of VC deals and total VC investment in Canada dropped in Q2’22 as the pace
of deals activity continued to slow. Fintech, health and biotech remained the most prominent
areas of VC investment in Canada, with digital bank Neo raising $145 million during the
quarter — earning the fintech unicorn status. VC investors in Canada have started to become
more discerning with their investments, advising their existing portfolio companies to shift
away from broad-brush growth strategies to more laser-focused strategies aimed at helping
them break even or achieve profitability.
#Q2VC
35
Brazil’s economy performs better than expected; VC investment still down Trends to watch for in Q3’22
The economy in Brazil performed better than expected during Q2’22, particularly in terms of With no end to current uncertainties in sight, VC investment across the Americas could be
GDP growth. VC investment, however, dropped markedly during the quarter, likely a result of relatively soft heading into Q3’22. Sectors like crypto and blockchain, e-commerce, and other
geopolitical uncertainty and other global macroeconomic factors. Despite the complex market consumer-focused industries could face consolidation as best-in-breed companies set
conditions, Brazil attracted several large VC rounds, including $100 million raises by themselves apart from the competition and companies that didn’t plan for a pullback run out of
cybersecurity and biometrics company Unico and B2B communications and social commerce cash.
firm Take Blip.
Down rounds could also become more prevalent, although many startups will likely exhaust
With a federal election slated for the autumn, VC investment could remain soft in Brazil well other options first — conducting layoffs, delaying or terminating projects, freezing R&D spend
into the second half of the year. Despite VC funds in the country having a significant amount of and slashing other expenses in order to conserve cash and delay new fundraising as much as
dry powder, investors are expected to act more like PE firms heading into Q3’22, with stricter possible.
criteria for valuations, cash generation, team size, and operating expenses as a whole.
#Q2VC
36
Venture financing in the Americas

2014–Q2'22
All in all, dealmaking in the Americas has slowed back to historical
$120 6,000 averages after the record-breaking run across all of last year and Q1
2022. It is likely financing volumes will edge back up as additional
data is gathered, but more importantly, with VC investment still being
$100 5,000
robust across most nations, it is clear that fund managers are still
looking to stay active, if not quite at a breakneck clip.
$80 4,000
… after a strong start to the year

$60 3,000 2022 saw some softening in the second
quarter, although only back to
$40 2,000 relatively healthy historical
averages.
$20 1,000
$100.1
$102.6
$15.6
$22.7
$18.0
$20.0
$22.0
$22.4
$23.9
$21.1
$21.6
$27.3
$19.6
$17.7
$19.2
$23.7
$26.1
$24.1
$32.0
$33.4
$36.0
$50.3
$41.3
$38.9
$41.6
$34.7
$40.2
$38.7
$49.7
$47.3
$81.5
$89.8
$89.3
$66.2
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Deal value ($B) Deal count Angel & seed Early VC Later VC
#Q2VC
37
Median deal size ($M) by stage in the Americas Up, flat or down rounds in the Americas
2014–2022* 2014–2022*
$16 100%
90%
$14
$13.0 80%
$12
70%
$10 $10.0
60%
$8 50%
40%
$6
30%
$4
20%
$2 $2.1
10%
$0 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Angel & seed Early VC Later VC Down Flat Up
#Q2VC
38
Median deal size ($M) by series in the Americas

2014–2022*
$140
$125.0
$120
$100
$80
$62.9
$60
$40
$33.0
$20
$13.7
$2.6
$0.3
$0
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
#Q2VC
39
Median pre-money valuation ($M) by series in the Americas

2014–2022*
$1,200
$1,000 $1,020.0
$800
$600
$400
$322.5
$200
$150.0
$10.45 $43.0
$0 $8.2
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
#Q2VC
40
Deal share by series in the Americas Deal share by series in the Americas
100% 100%
Series D+
90% 90%
80% 80%
70% Series C 70%
60% 60%
50% 50%
Series B
40% 40%
30% 30%
Series A
20% 20%
10% 10%
Angel & seed
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
41
Venture financing of VC-backed companies by sector in the Americas Venture financing of VC-backed companies by sector in the Americas
2014–2022*, # of closed deals 2014–2022*, VC invested ($B)
100% 100%
Transportation
90% 90%
Commercial Products
& Services
80% 80%
Consumer Goods &
Services
70% 70%
Software
60% 60%
Pharma & Biotech
50% 50%
Other
40% 40%
Media
30% 30%
IT Hardware
20% 20%
HC Services &
10% Systems 10%
HC Devices &
0% Supplies 0%
2022*
2014
2015
2016
2017
2018
2019
2020
2021
2022*
2014
2015
2016
2017
2018
2019
2020
2021
Energy
#Q2VC
42
“
Venture financing in Canada
2014–Q2'22 With a recession likely
coming, it will be interesting to
$6,000 400
see what’s going to happen
here. There will be some
350
$5,000 companies that look at a
recession as an opportunity —
300
as a chance to set themselves
$4,000 apart. How many companies
250
will actually go in the opposite
$3,000 200
direction of the crowd — while
others are laying off workers
150
and reducing growth? How
$2,000 many will be focused on
100 seizing the moment to get the
right people at a more
$1,000
reasonable salary and to try
$1,364.5
$1,285.7
$1,149.6
$1,858.0
$1,560.0
$1,205.0
$1,075.3
$1,288.6
$2,989.1
$4,909.9
$2,978.4
$2,939.7
$3,533.1
$1,949.0
50
$340.1
$356.9
$560.5
$549.3
$500.6
$585.5
$537.0
$427.4
$602.0
$339.6
$549.3
$720.7
$305.0
$781.4
$963.5
$688.5
$830.4
$701.4
$913.5
$813.2
and get market share? The
next quarter or two could be
”
$0 0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 very interesting.
2014 2015 2016 2017 2018 2019 2020 2021 2022
Deal value ($M) Deal count
Sunil Mistry
Partner, KPMG Private Enterprise,
Technology, Media &
Telecommunications (TMT)
KPMG in Canada
#Q2VC
43
Venture financing in Mexico

2014–Q2'22
By and large, 2022 is still seeing historically healthy rates of venture
$1,800 60 financing across key sectors within Mexico. It remains to be seen if
there is a plummet thanks to overall market volatility, but thus far, the
$1,600 data is looking auspicious.
50
$1,400
Even after a record 2021, thus far, the
$1,200 40
Mexican ecosystem is continuing
$1,000 to rake in plenty of VC relative to
30 historical averages, with Q2 tallying well
$800
over $500 million invested…
$600 20
$400
10
$1,353.8
$1,630.5
$200
$132.2
$146.4
$312.3
$158.3
$203.7
$287.7
$200.2
$693.3
$287.2
$848.4
$371.7
$523.6
$70.4
$88.8
$26.0
$18.8
$21.7
$12.5
$56.5
$72.7
$17.5
$28.2
$62.6
$22.5
$15.9
$51.4
$67.0
$50.1
$83.9
$43.6
$54.4
$5.3
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
44
“
Venture financing in Brazil
2014–Q2'22
Last year, there was a big hike
$3,500 180
Thanks to a bevy of outlier financings,
Brazil finished last year strong with a in VC investments in Brazil. It
total of 22 companies raising at least really picked up, seemingly on
160
$3,000
$100 million or more throughout its a monthly basis. This year,
duration. Moreover, they spanned a liquidity has been much lower.
140 plethora of sectors, signaling growing
innovation in multiple segments of the While funds still have dry
$2,500
Brazilian socioeconomic ecosystem. powder, they are becoming
120
Thus far this year, a handful of such much more concerned about a
deals occurred but at nowhere near the company’s ability to break
$2,000 100 same rate, potentially suggesting
investors took a pause or pulled back
even, generate cash, and grow
80 slightly given rising caution amid with lower capital expenditure
$1,500
darkening global economic conditions. needs. In Q3’22, capital
That said, Q2 still turned in a relatively efficiency and the use of cash
60
resilient tally of funding.
$1,000 by startups is expected to be at
the top of the radar for every
”
40
$500
single VC fund.
$1,096.3
$1,488.0
$3,015.7
$2,713.6
$1,729.4
20
$146.8
$213.6
$166.7
$157.4
$280.9
$133.8
$118.8
$123.3
$106.6
$140.6
$197.4
$210.0
$260.3
$445.0
$105.3
$307.5
$981.6
$139.6
$504.5
$358.6
$492.8
$568.5
$762.6
$595.7
$904.3
$570.3
$89.0
$64.1
$89.1
$0 0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2014 2015 2016 2017 2018 2019 2020 2021 2022

Rodrigo Guedes
Managing Director
KPMG in Brazil
#Q2VC
45
Top 10 financings in Q2'22 in Americas
10
3 1. Epic Games — $2B, Cary, US — Entertainment software — Late-stage VC

5
4 9 1
8 2. SpaceX — $1.7B, Hawthorne, US — Aerospace — Late-stage VC
2
6 7
3. Gopuff — $1.5B, Philadelphia, US — Internet retail — Late-stage VC
4. Faire — $816M, San Francisco, US — E-commerce — Series G
5. Ramp — $748.3M, New York, US — Fintech — Series C
6. The Boring Company — $675M, Burlingame, US — Infrastructure — Series C
7. Resilience — $625M, San Diego, US — Pharmaceuticals — Series D
8. Anthropic — $580M, San Francisco, US — Information services — Series B
9. Crusoe Energy Systems — $505M, Denver, US — Cleantech — Series C
10. Group14 Technologies — $400M, Woodinville, US — Cleantech — Series C
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022.
Data provided by PitchBook, July 20, 2022.
# Q2VC
46
Global | US | Americas Europe Asia
#Q2VC
47
Q2’22 saw a decline in both VC investment and the number of VC deals in Europe, driven by increasing geopolitical uncertainties related to
the crisis in Ukraine, growing awareness of dependencies on certain raw materials and value chains, and deepening concerns about inflation.
During Q2’22, the European Central Bank also announced that it would be raising interest rates for the first time in 11 years on July 1, 2022,
followed by an additional hike in September.
Reliance on fossil fuels sparks interest in ESG and alternative energy CVC investment dips, although interest remains solid
While ESG and sustainability solutions have gained traction with VC investors in Europe in CVC investment in Europe dropped in Q2’22, although interest among CVCs has remained
recent years, Q2’22 saw interest strengthen considerably as discussions relating to the relatively strong — particularly among strategic corporate investors looking to take equity
region’s reliance on fossil fuels grew in the wake of the crisis in Ukraine. In particular, there stakes in strategic businesses. Given market uncertainties, there could be an increasing
has been increasing interest in renewable energy-based business models, decentralized number of CVCs looking to make PE-style investments in Europe. This, combined with the dry
energy-based business models, and ESG more broadly — including areas like mobility and powder in the market, could drive an uptick in buyout activity and consolidations.
cleantech. One of the largest deals in Europe during Q1’22 was a $650 million raise by
Switzerland-based Climeworks, a company focused on direct air carbon capture technology. VC investment in the UK remains robust
Declining interest in consumer business models as inflation remains high VC investment in the UK continued at a torrid pace for the sixth straight quarter in Q2’22.
Fintech remained a hot area of investment this quarter, led by a $626 million raise by SumUp
Given rising inflation, increasing interest rates, and other macroeconomic factors, VC investor and a $312 million raise by GoCardless. Health and biotech also continued to attract attention,
interest in consumer-driven companies is expected to decline in Europe, particularly in areas in part because of their resilience to inflation compared to other sectors. Edtech also attracted
like last mile delivery, marketplaces, and e-commerce. While leading startups in different some attention in Q2’22, led by a $220 million raise by online apprenticeship platform
sectors will likely continue to gain attention from investors, others may find themselves facing Multiverse, which earned the company unicorn status.
challenges. This could drive consolidation among startups, in addition to interest from private
equity (PE) investors looking at distressed companies. With traditional VC firms in the UK beginning to take a more cautious investment approach,
activity from non-traditional investors could increase in niche areas of investment. Heading into
Cash preservation becoming a major focus for startups Q3’22, the UK could see some high-net-worth individual investors stepping in to help fund
Series A and Series B deals that might have been funded by institutional money in previous
During Q2’22, startups across Europe increasingly focused on cash preservation. Several tech quarters.
companies, including Germany-based delivery firm Gorillas, announced major layoffs or delays
in their growth plans in order to reduce their burn rate and potentially delay additional
fundraising activity until macroeconomic conditions improve.
#Q2VC
48
Drop in VC investment in Europe amid rising uncertainty , cont’d.
Number of VC deals in Germany drops in Q2’22; VC investment remains solid turning to bridge financial instruments like convertibles from existing investors or government-
backed financing and in order to survive, achieve better terms and valuation multiples once the
VC investment in Germany remained relatively solid in Q2’22, although the number of VC deals market and/or companies performance improves.
dropped considerably. Germany-based VC continued to raise a significant amount of money,
including Trade Republic ($1.15 billion), Personio ($470 million), Onefootball ($316 million), In sectors B2B software showed resilience compared to consumer retail businesses in Q2’22
Taxfix ($220 million), and 1Komma5 ($219 million) during the quarter. with Finland based Aiven leading the way raising $210 million during the quarter.
In the wake of recent uncertainties, companies in Germany have started to reconsider their value The Deep Tech sector has also remained as a hot area of interest among VC investors.
and supply chains, looking at where their raw materials and pre-components are produced. This
focus is expected to increase over the next quarter as investors and other stakeholders put more Trends to watch for in Q3’22
pressure on companies to improve the sustainability of their supply chains and reduce reliance VC investors in Europe are expected to remain cautious heading in Q3’22, increasing their
on countries with different core values. This could drive an uptick in interest in startups focused
scrutiny of companies looking to attract funding. Given the strong amount of funding available
on improving niche areas of value chains.
in the market, high quality technology companies are expected to continue to attract funding.
In the wake of recent uncertainties, companies in Germany have started to reconsider their value Companies that may have attracted funding from optimistic investors in the past, however, will
and supply chains, looking at where their raw materials and pre-components are produced. This likely face more challenges and require stronger business cases and paths to profitability to
focus is expected to increase over the next quarter as investors and other stakeholders put more attract funding over the next few quarters. Pressure on valuations could also increase the
pressure on companies to improve the sustainability of their supply chains and reduce reliance potential for down rounds and spark interest in the use of downside protections by VC
on countries with different core values. This could drive an uptick in interest in startups focused investors.
on improving niche areas of value chains.
The IPO market is expected to remain cool in Europe, particularly for consumer businesses
and industrial companies whose supply costs are skyrocketing. Valuations will likely also see
VC investment in the Nordics remains solid though the deal count slows downward pressure heading into Q3’22.
The Nordics is starting to see the effects of a global decline in VC investment and number of
deals. Preservation of adequate runway, capital efficiency, healthy unit economics, path to
profitability along with dropping valuation offers seems to be in top of mind for many companies.
Some companies aiming to raise funding from international investors in order to scale up are now
#Q2VC
49
Venture financing in Europe

2014–Q2'22
Once again, despite significant turmoil spanning economies and
$40 3,500
markets, Europe saw a significant tally of VC invested in Q2 2022,
carrying financing levels to mid-year with more-than-robust figures.
$35 3,000
This is likely due to significant levels of global dry powder,
government support via policies and accelerators for key sectors,
and the impact of outliers.
$30
2,500
$25
2,000 … despite significant volatility,
$20 European startup ecosystems
$15
1,500
continue to raise hefty sums
1,000
of capital…
$10
500
$5
$10.0
$11.0
$12.0
$11.0
$10.9
$11.7
$16.6
$16.2
$28.4
$36.2
$29.2
$32.9
$33.8
$27.3
$4.3
$3.8
$4.4
$3.7
$5.2
$5.0
$5.7
$4.9
$6.0
$4.9
$4.4
$5.3
$5.3
$7.1
$6.5
$8.7
$8.9
$8.5
$7.7
$9.8
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
50
Median deal size ($M) by stage in Europe Up, flat or down rounds in Europe
2014–2022* 2014–2022*
$8 100%
$7.5
90%
$7
80%
$6
70%
$5
60%
$4 50%
40%
$3
$2.8
30%
$2
$1.6 20%
$1
10%
$0 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
Angel & seed Early VC Later VC

Down Flat Up
#Q2VC
51
Median deal size ($M) by series in Europe

2014–2022*
$160
$140 $141.5
$120
$100
$80 $79.6
$60
$40
$35.6
$20
$12.0
$0 $0.7 $2.1
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
#Q2VC
52
Median pre-money valuation ($M) by series in Europe

2016-2022*
$1,800
$1,600 $1,576.1
$1,400
$1,200
$1,000
$800
$600
$400
$335.8
$200
$98.5
$32.0
$0 $6.2 $4.4
2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. The figure for Series D or later valuations in 2017 is based on non-normative population sizes.
#Q2VC
53
Deal share by series in Europe Deal share by series in Europe

100% 100%
Series D+
90% 90%
80% 80%
70% Series C 70%
60% 60%
50% Series B 50%
40% 40%
30% 30%
Series A
20% 20%
10% 10%
Angel & seed
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
54
European venture financings by sector European venture financings by sector

100% Transportation 100%
90% Commercial 90%

Products & Services
80% 80%
Consumer Goods &
Services
70% 70%
Software
60% 60%
Pharma & Biotech
50% 50%
Other
40% 40%
Media
30% 30%
IT Hardware
20% 20%
HC Services &
10% Systems 10%
HC Devices &
0% Supplies 0%
2022*
2014
2015
2016
2017
2018
2019
2020
2021
2022*
2014
2015
2016
2017
2018
2019
2020
2021
Energy
#Q2VC
55
Corporate VC participation in venture deals in Europe First-time venture financings of companies in Europe
2014–Q2'22 2014–2022*
$18 700 $14 4,000
$16 3,500
600 $12
$14
500 3,000
$10
$12
2,500
$10 400 $8
2,000
$8 300
$6
$6 1,500
200
$4
$4 1,000
100
$11.6
$17.0
$13.7
$13.8
$15.9
$10.4
$2 $2
$1.5
$1.1
$1.9
$0.9
$1.1
$2.0
$1.4
$1.2
$2.7
$2.0
$1.6
$2.0
$1.8
$2.7
$2.3
$2.9
$2.9
$3.1
$3.4
$3.8
$3.8
$5.3
$5.3
$3.5
$4.2
$5.8
$8.0
$6.5
500
$13.3
$2.9
$2.7
$2.9
$3.7
$4.4
$3.9
$4.3
$4.6
$0 0
$0 0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2014 2015 2016 2017 2018 2019 2020 2021 2022*
2014 2015 2016 2017 2018 2019 2020 2021 2022
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook,
July 20, 2022. July 20, 2022.
Corporates have likely pulled back participation in some venture rounds at least somewhat After a historic year, reversion to the mean is to be anticipated, and 2022 thus far has seen a
given growing economic pressures or concern for how their overall business lines may be healthy rate of first-time financings, yet not nearly at the same level as that seen in 2021.
impacted should a recession come to fruition. That said, they remained relatively active However, compared to historical averages, 2022 is experiencing a very robust influx of capital
compared to historical tallies. even for fledgling financings.
#Q2VC
56
Venture-backed exit activity in Europe

2014–Q2'22
Sliding exit tallies after the record quarter in late 2021 could be
$80 350
more attributed to overall rises in market volatility than anything
else, as well as caution on the part of prospective acquirers, than
$70 300 a decline in liquidity-ready venture-backed companies. However,
with exit values rising somewhat quarter over quarter, it is
possible that exit rates may plateau.
$60
250
$50 … robust liquidity trends from

200
$40
last year could continue to bolster
150 recycled capital into the ecosystem
$30
going forward, but exit volume could be
$20
100 entering a plateau.
$10 50
$16.6
$30.8
$12.6
$12.6
$11.0
$12.1
$36.8
$31.5
$69.4
$24.5
$12.0
$16.2
$3.7
$1.9
$6.2
$5.8
$5.2
$4.1
$8.2
$6.9
$3.1
$4.2
$2.5
$5.3
$7.4
$3.3
$4.5
$2.0
$5.2
$3.3
$2.6
$8.9
$1.7
$5.5
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
57
Venture-backed exit activity (#) by type in Europe Venture-backed exit activity ($B) by type in Europe
2014–2022* 2014–2022*
1,400 $180
$160
1,200
$140
1,000
$120
800
$100
$80
600
$60
400
$40
200
$20
0 $0
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
58
“
European venture fundraising
2014–2022*
The market is cooling.
Thus far this year, fundraising efforts remain very
$35 350
strong even relative to the historic highs seen in There’s no IPOs happening in
2021. Even though the count of closed pools of the UK, or really across
capital is off pace, plenty of firms have been able to Europe. There’s no ECM
$30 300 close on large sums.
activity either, whether equity
or debt. The consumer tech
... at well
over $13 billion sector has seen the biggest
$25 250
slowdown, along with the
$20 200
in capital commitments, industrial sector where costs
2022 is off to more-than-robust and overhead increases are
tallies halfway through the year. now coming through.
$15 150 That said, there are still
businesses where growth is
$10 100 outstripping inflation, there’s
still a lot of VC money
around, and there is still quite
”
$5 50 a bit of M&A activity.
$12.5
$11.9
$18.0
$25.2
$18.7
$23.2
$23.5
$29.3
$13.3
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. Jonathan Boyers
Partner, Corporate Finance
KPMG in the UK
#Q2VC
59
Venture fundraising (#) by size in Europe First-time vs. follow-on venture funds (#) in Europe
2014–2022* 2014–2022*
100% 100%
90% 90%
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
$1B+ $500M-$1B $250M-$500M $100M-$250M $50M-$100M Under $50M First-time Follow-on
#Q2VC
60
“
Venture financing in the United Kingdom
2014–Q2'22
Investment activity remains
$12 1,000 remarkably strong so far this
year in the UK, with recent
900
high-profile deals in the
$10 fintech, healthtech and
800
edtech sectors in particular.
700 Bigger deals are also starting
$8
to surface (OR happen OR
600
take place) in some nascent
$6 500 areas such as climate-tech
and cleantech, as ESG-
400 related businesses continued
$4 to capture investor attention
300
following last year’s COP26
”
200 Summit in the UK.
$2
100
$10.2
$1.0
$1.2
$1.1
$1.3
$1.5
$1.1
$2.1
$2.0
$1.6
$1.5
$1.4
$1.6
$1.4
$2.8
$2.3
$4.2
$2.5
$2.8
$2.6
$3.3
$4.1
$3.5
$3.5
$3.2
$3.2
$3.7
$4.4
$5.0
$9.1
$8.4
$9.9
$9.8
$8.6
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Deal value ($B) Deal count
Warren Middleton
Lead Partner for Emerging Giants,
Center of Excellence in the UK
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. KPMG in the UK
#Q2VC
61
Venture financing in London

2014–Q2'22
$8 600
$7
500
$6
400
$5
$4 300
$3
200
$2
100
$1
$0.6
$0.7
$0.6
$0.7
$0.9
$0.6
$1.2
$1.1
$0.8
$1.0
$0.9
$0.8
$0.7
$2.2
$1.5
$3.5
$1.5
$1.5
$1.7
$2.0
$2.7
$2.7
$2.1
$2.1
$1.8
$2.5
$3.1
$3.0
$6.3
$5.5
$7.1
$5.8
$7.1
$6.9
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
62
“
Venture financing in Ireland
2014–Q2'22
While Irish VC activity has
$1,000 200 slowed down, it has still shown
remarkable resilience despite
$900 180 significant turbulence. Ireland
remains a significant area of
$800 160
investment in the MedTech,
$700 140 Pharmaceutical, FinTech and
GreenTech spaces, all of
$600 120 which we expect to continue
to grow even as consumer
$500 100
spending dips. Given that
$400 80 a global recession seems
increasingly likely, is
$300 60 understandable that there is
”
a high degree of caution.
$200 40
$247.3
$164.3
$121.5
$175.8
$233.7
$143.7
$307.4
$169.2
$265.2
$198.7
$112.7
$178.3
$133.0
$399.7
$396.7
$470.1
$137.9
$133.6
$188.1
$126.8
$310.1
$181.1
$660.7
$372.7
$888.7
$461.7
$389.6
$436.6
$207.0
$100 20
$33.7
$46.1
$51.5
$81.1
$60.3
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Anna Scally
Deal value ($M) Deal count Partner, Head of Technology &
Media & Fintech Lead
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. KPMG in Ireland
#Q2VC
63
“
Venture financing in Germany
2014–Q2'22
One of the biggest discussions
$7,000 400 happening in Germany is about
the countries it depends on for
350 raw materials and value chains
$6,000
and whether it should move
300 away from countries that hold a
$5,000 detrimental view on certain
250
central values that as a Western
$4,000 ecosystem really hold up. While
discussions are at the early
200
stages, it is probably going to
$3,000
drive a lot of economic decisions
150
over time. And while the German
$2,000 OEMs have been reluctant to
100
enter the discussion, there’s
been a lot more pressure in
”
$1,000
$1,760.6
$1,060.5
$1,227.0
$1,688.7
$1,474.6
$1,198.4
$1,460.3
$1,954.8
$1,447.0
$1,311.4
$1,895.3
$2,146.0
$1,895.5
$3,148.1
$5,214.4
$4,214.8
$5,985.3
$3,429.0
$4,609.2
50 recent days for them to act.
$517.1
$387.9
$394.3
$656.0
$851.0
$801.7
$603.8
$562.4
$563.9
$620.3
$576.3
$836.8
$891.6
$930.9
$0 $804.4 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Dr. Ashkan Kalantary

Deal Advisory, M&A
GrowthTech & Ventures
KPMG in Germany
#Q2VC
64
“
Venture financing in Berlin
2014–Q2'22
A lot of VC investors and
$5,000 180 startups are anticipating that
the IPO market is now gone
$4,500 160 at least for the next 18-24
$4,000 months. Companies,
140
particularly later stage
$3,500 companies that were
120
expecting an IPO, have had
$3,000
100 to rapidly rethink their plans.
$2,500 This is forcing companies into
80 a situation where cash is
$2,000
king — where they need to
60
$1,500 find the money to bridge the
time until they can either raise
40
$1,000 an additional private financing
”
round or an IPO.
$1,206.8
$1,236.7
$1,292.5
$1,235.7
$1,871.3
$2,396.9
$2,642.0
$4,325.7
$1,994.3
$2,895.2
20
$413.7
$182.3
$927.1
$150.6
$918.8
$536.7
$741.3
$330.3
$234.6
$350.6
$184.9
$376.6
$329.0
$990.5
$407.4
$412.4
$439.4
$179.7
$850.5
$506.2
$488.6
$745.0
$636.4
$952.5
$500
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022

Tim Dümichen
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. Partner
KPMG in Germany
#Q2VC
65
Venture financing in Spain

2014–Q2'22
$2,500 180
160
$2,000
140
120
$1,500
100
80
$1,000
60
40
$500
$1,470.0
$2,088.7
$1,060.8
$119.7
$100.9
$184.0
$141.4
$158.9
$379.5
$150.4
$145.6
$311.4
$191.4
$138.5
$323.9
$277.0
$481.1
$136.9
$156.7
$506.8
$345.7
$338.2
$350.5
$277.8
$679.0
$455.2
$470.5
$692.7
$514.0
20
$46.8
$80.4
$93.2
$86.3
$71.8
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
66
Venture financing in France

2014–Q2'22
$7,000 400
350
$6,000
300
$5,000
250
$4,000
200
$3,000
150
$2,000
100
$1,000
$1,184.0
$1,343.8
$1,263.3
$1,429.9
$1,573.0
$1,164.6
$1,340.8
$1,864.7
$1,496.2
$2,345.9
$1,944.8
$1,934.3
$4,103.4
$3,671.2
$2,838.8
$5,830.7
$2,908.6
50
$354.5
$440.3
$347.9
$333.6
$438.1
$515.5
$645.3
$329.9
$451.0
$533.0
$506.4
$931.1
$814.0
$710.1
$725.0
$607.7
$809.7
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
67
Venture financing in Paris

2014–Q2'22
$3,500 160
$3,000 140
120
$2,500
100
$2,000
80
$1,500
60
$1,000
40
$500
$1,099.6
$1,032.1
$1,127.5
$1,645.4
$3,193.7
$1,906.4
$1,548.8
$3,299.6
$2,010.0
20
$162.2
$176.5
$215.8
$200.2
$122.9
$278.6
$433.9
$281.4
$314.7
$354.5
$464.2
$623.9
$465.1
$454.8
$265.1
$731.3
$909.6
$445.1
$674.5
$800.2
$643.8
$904.3
$907.3
$966.4
$92.5
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
68
Financing activity trucks along in the Nordics
“
Venture financing in the Nordics
2014–Q2'22
In Q2’22, it became clear that
$7,000 450 there was going to be
somewhat of a slowdown in
400 VC funding and stalling of
$6,000
IPO's here in the Nordic region
350
following the global trend.
$5,000 The sentiment is now leaning
300
more towards capital
$4,000 efficiency, healthy unit
250
economics and path to
profitability compared to
”
$3,000 200
growth at all cost.
150
$2,000
100
$1,000
$1,314.7
$1,149.2
$2,022.4
$1,018.4
$1,585.1
$2,419.6
$1,839.7
$4,169.0
$6,635.6
$1,961.1
$2,370.2
$3,262.5
$2,027.3
50
$515.6
$327.3
$194.1
$341.9
$460.3
$876.4
$370.7
$405.6
$287.4
$341.9
$548.9
$605.4
$549.9
$521.6
$680.6
$680.9
$853.7
$559.2
$746.1
$708.1
$980.1
$0 0 Jussi Paski
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Head of Startup Services
KPMG in Finland
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
69
“
Venture financing in Israel
2014–Q2'22
The Israeli market has not been
$5,000 250 fully immune to the recent decline
in company values worldwide, yet
$4,500 it still showcases a resilient
market in terms of investments.
$4,000 200 Though during the second
quarter of 2022 funding rounds of
$3,500 Israel's private growth companies
are based on lower multiples and
$3,000 150 consequently lower valuations
than before, and investment
$2,500 values in early stage funding
rounds (pre-seed, seed and even
$2,000 100 Round A) have decreased, the
number of investments has
$1,500 remained stable, with more than
a dozen companies raising large-
$1,000 50 scale funding rounds of $100M
and more, such as Semperis
$1,027.4
$1,229.1
$1,023.1
$1,063.8
$1,084.2
$1,054.8
$1,144.6
$1,423.7
$1,818.0
$2,516.6
$2,925.5
$2,796.9
$4,453.8
$3,224.5
$2,646.2
”
$581.1
$304.1
$282.4
$362.4
$774.7
$312.5
$302.2
$431.7
$779.5
$580.3
$519.2
$296.5
$641.6
$583.1
$735.4
$728.1
$803.7
$932.6
$825.1
$500 ($200M), Pixellot ($161M) and
Coralogix ( $142M).
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022

Dina Pasca-Raz
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. Head of Technology,
Head of International Tax
KPMG in Israel
#Q2VC
70
Top 10 financings in Q2'22 in Europe
1 1. Trade Republic — $1.15B, Berlin, Germany — Fintech — Series C

3 7
9
10 6 2. Climeworks — $650M, Zurich, Switzerland — Cleantech — Late-stage VC
8
2
3. SumUp — $626.6M, London, UK — Fintech — Late-stage VC
5 4
4. Rimac Autombili — $528.7M, Sveta Nedelja, Croatia — Mobility — Series D
5. Scalapay — $524M, Milan, Italy — Fintech — Series B
6. Personio — $470M, Munich, Germany — SaaS — Series E
7. Perpetual Next — $340.1M, Amsterdam, Netherlands — Cleantech — Series A
8. Newcleo — $318.75M, London, UK — Cleantech — Early-stage VC
9. Onefootball — $316.2M, Berlin, Germany — Entertainment software — Series D
10. GoCardless — $312M, London, UK — Fintech — Series G

#Q2VC
71
Global | US | Americas | Europe Asia
#Q2VC
72
VC investment in Asia dropped to an 8 quarter low in Q2’22, driven by a steep decline in deal volume. Geopolitical uncertainty, a quiet IPO
market across the region, and a lack of $1 billion+ mega deals likely contributed to the decline.
Energy sector remains hot area for VC investment in Asia Anticipation of funding issues driving startups in India to focus on cash
preservation
Energy continued to be one of the hottest sectors of investment across Asia, with companies raising
large funding rounds even at early deal stages. During Q2’22, China-based Gokin Solar raised a VC investment in India dipped in Q2’22, driven in part by global geopolitical uncertainties and
$251 million Series A round. The large early stage funding rounds seen in recent quarters likely rising inflation. VC-backed companies in India shifted their focus to cash preservation in
reflect the fact that energy startups — including those focused on electric vehicles, alternative anticipation of funding becoming less easy to obtain over the next few quarters and VC
energy, and energy storage — are capital intensive compared to startups in other sectors. investors requiring companies to strengthen their paths to profitability and lower their cash burn.
ESG remained a high priority in Hong Kong (SAR) during Q2’22, with the Hong Kong Monetary Fintech remained the hottest area of investment in India during the quarter, in addition to
Authority continuing to work on ways to drive green finance initiatives forward through its work with e-commerce, social commerce, and gaming. Agritech also attracted a growing number of
Hong Kong (SAR) and international banks. deals in Q2’22; while the majority of these deals occurred at very early deal stages, the space
is expected to see deal sizes grow as the sector evolves.
IPO exits come to near standstill in Asia
VC investment in Japan remains solid as market continues to mature
IPO exits were quiet in Q2’22. The rocky performance of the global public markets, ongoing
geopolitical considerations and new waves of COVID-19 restrictions in China likely hindered IPO Japan attracted a solid amount of VC funding in Q2’22 as the country’s VC market continued
exits in the region. US-based IPO exits of China-based companies dried up completely during to evolve and mature. Companies from across a variety of sectors attracted funding during the
Q2’22, in part due to ongoing concerns related to the Holding Foreign Companies Accountable Act quarter, including wireless power transmitter company Space Power Technologies ($200
in the US and the potential for delistings. While the Chinese government is working with its US million), diagnostics company AIM ($70 million), pick-assist robotics company Rapyuta
counterparts to come to a resolution, the current uncertainty has many companies reconsidering Robotics ($50 million), and B2B fintech services provider Upsider ($42 million). At a sector
their IPO options. level, fintech continued to attract significant interest from VC investors, including areas like
payments, asset management, blockchain and Web 3.0.
Macroeconomic challenges affect VC investment in China in Q2’22
During Q2’22, the government of Japan also released the draft of its economic growth
VC investment in China remained low in Q2’22 as the country faced new COVID-19 surges. strategy, which included a number of measures to spur innovation, support startups, and foster
Several large cities in China experienced extended lockdowns, causing challenges for companies VC investments.
across sectors, but particularly for those focused on traditional retail, hospitality, and transportation.
Investor interest in consumer technology-focused companies continued to drop as the Chinese
government continued to introduce rules aimed at limiting the growth of companies in the sector to
reduce potential monopolies.
#Q2VC
73
Domestic VC funds taking stronger role in supporting China-based startups Trends to watch for in Q2’22
China saw VC funding continue to tilt away from US dollar-based VC funds to yuan renminbi Across Asia, M&A activity could get a boost heading into Q3’22 as investors and corporates
funds during Q2’22 as domestic VC funds took a large role in supporting fast growing startups look to take advantage of the lower valuation environment and tightening funding environment
in the country. As US investors have become more cautious about making VC investments in to find inorganic growth opportunities and opportunities to gain market share.
China, the shift towards domestic funds has been quite noticeable—particularly for unicorn and
near-unicorn companies. VC investment in China is expected to remain relatively soft in Q3’22, given the ongoing
COVID-19 situation and the uncertain geopolitical and macroeconomic environments.
The time to complete deals also lengthened in Q2’22 as some startups in China struggled to Fundraising activity is also expected to remain quite low. In China, the energy and
attract necessary funding. This was particularly true for companies in sectors seeing semiconductors sectors are expected to remain attractive for investors. In Hong Kong (SAR),
downward pressure on valuations as it is difficult for startups in China to raise funds at lower VC investments are expected to continue in a broad range of areas, including healthtech,
valuations because of sentiment from earlier-stage investors. insurtech, and greentech.
While VC investment in India may be muted over the next quarter or two due to the global
reduction in money supply and other factors, the country is expected to remain quite attractive
to VC investors over the medium to longer term due to its relatively positive macroeconomic
environment and market demographics.
#Q2VC
74
Q2 sees continued slide, yet volume could tick upward in the future
“
Venture financing in Asia
2014–Q2'22
Overall venture capital
Financing volume took a hit in
$80 4,000 investment in China has slowed
the second quarter of the year,
contributing also to a decline in considerably in the first half of
$70 3,500 total VC invested. If additional the ear. COVID-19- related
data comes into visibility in shutdowns, in combination with
ensuing months, this trend may
$60 3,000 slowing participation by
not be quite as sudden as it
currently appears; it’s also international investors and
$50 2,500 worth noting that both VC caution related to last year’s
invested and deal counts have regulatory changes, have taken
only returned to relatively
$40 2,000 their toll on the VC
typical ranges for a given
quarter. ecosystem. However, there
$30 1,500 continues to be strong
investment in areas such as
$20 1,000 robotics, semiconductors and
ESG — all key areas at the
$10 500 heart of the Central
$12.7
$13.5
$27.7
$12.5
$21.0
$28.4
$17.8
$14.9
$12.3
$18.1
$25.6
$23.8
$33.0
$49.4
$34.9
$33.7
$25.3
$19.1
$36.1
$34.4
$26.2
$20.7
$32.1
$43.5
$44.3
$47.0
$56.5
$69.9
$39.6
$24.5
Government’s most recent
”
$5.3
$5.5
$6.2
$9.8
$0 0 5-year plan.
2014 2015 2016 2017 2018 2019 2020 2021 2022
Egidio Zarrella
Partner, Clients and Innovation
KPMG China
#Q2VC
75
Median deal size ($M) by series in Asia

2014–2022*
$100
$90
$80
$70
$62.8
$60
$50
$42.8
$40
$30
$20
$16.0
$10 $10.0
$1.5
$0 $0.4
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
#Q2VC
76
Median pre-money valuation ($M) by series in Asia

2017–2022*
$1,000
$937.5
$900
$800
$700
$600
$500
$400 $392.0
$300
$200
$100 $89.4
$29.0
$3.2
$0 $5.1
2014 2015 2016 2017 2018 2019 2020 2021 2022*
Seed Angel A B C D+
Source: Venture Pulse, Q2’22, Global Analysis of Venture Funding, KPMG Private Enterprise. *As of June 30, 2022. Data provided by PitchBook, July 20, 2022. Figures for Series C in 2014, as well as Seed, Angel, Series C and Series D+ in 2022 are based on non-normative population sizes.
#Q2VC
77
Deal share by series in Asia Deal share by series in Asia

100% 100%
Series D+
90% 90%
80% 80%
70% Series C 70%
60% 60%
50% 50%
Series B
40% 40%
30% 30%
Series A
20% 20%
10% 10%
Angel & seed

0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
78
Asia venture financings by sector Asia venture financings by sector

100% 100%
Transportation
90% 90%
Commercial
Products &
80% Services 80%
Consumer Goods &
Services
70% 70%
Software
60% 60%
Pharma & Biotech
50% 50%
Other
40% 40%
Media
30% 30%
IT Hardware
20% 20%
HC Services &
10% Systems 10%
HC Devices &
0% Supplies 0%
2022*
2014
2015
2016
2017
2018
2019
2020
2021
2022*
2014
2015
2016
2017
2018
2019
2020
2021
Energy
#Q2VC
79
Corporate participation in venture deals in Asia

2014–Q2'22
Corporates played a key role in supporting the rise of venture
$45 1,400
investment, given the political and economic structures of
major nations such as India and China throughout the entire
$40 2010s. As of late, however, they have pulled back in terms of
1,200
aggregate deal value, which is likely more due to financing
$35 sizes declining on average at least somewhat.
1,000
$30 … the year thus far has seen
$25 800 a return to tallies seen in
$20
the late 2010s, which were
600
relatively healthy.
$15
400
$10
200
$5
$18.0
$13.1
$21.2
$17.3
$10.5
$19.7
$36.9
$22.1
$15.8
$14.5
$10.2
$13.7
$22.1
$18.2
$10.7
$18.8
$26.2
$18.3
$20.7
$34.2
$39.7
$22.4
$12.7
$2.7
$2.9
$2.7
$4.9
$5.8
$6.8
$6.5
$9.8
$8.3
$5.8
$8.4
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
80
Reasonably healthy exit volume carries into mid-year
“
Venture-backed exit activity in Asia
2014–Q2'22
While the VC market is
After some record quarters in
$200 200 being challenged in Hong
2021, 2022 has observed
healthy exit trends, with well Kong, our long-term
$180 180
over or close to $20 billion in prospects remain positive as
$160 160
exit value notched in Q1 and the government continues to
Q2 apiece. Volume has slid,
support the economy amid
$140 140 but is roughly approximate to
historical averages. the impact of COVID-19.
$120 120 Also, our financial system
has strong fundamentals
$100 100 alongside the commitment
$80 80
made by the Securities and
Futures Commission and
$60 60 other government
departments to develop
$40 40
Hong Kong (SAR) as a
”
sustainable finance hub.
$190.3
$121.7
$20 20
$47.2
$11.6
$13.1
$41.0
$15.8
$31.0
$47.5
$65.2
$11.4
$26.5
$26.5
$24.4
$22.9
$34.5
$55.5
$45.9
$28.6
$93.2
$26.5
$18.8
$1.2
$3.3
$4.6
$9.7
$4.9
$6.8
$4.5
$7.8
$6.7
$7.7
$6.9
$7.9
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Irene Chu
Partner & Head of New Economy and
Life Sciences, Hong Kong (SAR) Region
KPMG China
#Q2VC
81
Venture-backed exit activity (#) by type in Asia Venture-backed exit activity ($B) by type in Asia
2014–2022* 2014–2022*
700 $500
$450
600
$400
500
$350
$300
400
$250
300
$200
200 $150
$100
100
$50
0 $0
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
82
Venture fundraising in Asia

2014–2022*
Cyclicality could still be at play in the slow start to venture fundraising in 2022, but it is also
$140 1,400
possible corporations and government-affiliated funds and programs are obviating the need for
significant domestic, local venture funds. In addition, geopolitical tensions could be forestalling
capital commitments from LPs abroad.
$120 1,200
$100 1,000
The fundraising cycle subsided further in what
could still be a cyclical pause, based on the
$80 800 healthy tallies last year, but it remains to
be seen how long this is sustained…
$60 600
$40 400
$20 200
$102.5
$125.0
$23.4
$80.0
$95.9
$87.4
$85.0
$78.7
$16.9
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022*
#Q2VC
83
Venture fundraising (#) by size in Asia First-time vs. follow-on venture funds (#) in Asia
2014–2022* 2015–2022*
100% 100%
90% 90%
80% 80%
70% 70%
60% 60%
50% 50%
40% 40%
30% 30%
20% 20%
10% 10%
0% 0%
2014 2015 2016 2017 2018 2019 2020 2021 2022* 2015 2016 2017 2018 2019 2020 2021 2022*
$1B+ $500M-$1B $250M-$500M $100M-$250M $50M-$100M Under $50M First-time Follow-on
#Q2VC
84
“
Venture financing in India
2014–Q2'22
In India, the funding hasn’t
$18,000 700 dried up yet, but many
startups are taking proactive
$16,000
600
steps to reduce their cash
burn given the increase in
$14,000
federal interest rates, the
500
$12,000
crisis in Ukraine, and other
evolving issues. Because they
$10,000 400 anticipate challenges raising
funding and expect investors
$8,000 300 will increasingly ask for paths
to profitability and better cash
$6,000
200 conservation, they’re doing
$4,000 what they can to improve their
operating position now so
$15,652.3
$10,282.2
100
$1,819.9
$2,301.6
$1,622.4
$2,444.7
$3,965.5
$1,419.0
$1,641.7
$1,434.2
$1,766.0
$2,199.8
$5,650.9
$2,104.0
$1,934.6
$1,753.7
$2,427.6
$2,456.5
$2,386.6
$3,283.7
$4,938.6
$6,496.0
$6,473.8
$1,958.6
$4,472.5
$4,028.6
$4,239.9
$5,795.4
$9,299.6
$6,543.7
$2,000 they can potentially avoid
$508.3
$926.6
$744.2
$903.4
”
drastic changes later.
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Nitish Poddar
Partner and National Leader,
Private Equity
KPMG in India
#Q2VC
85
“
Venture financing in China
2014–Q2'22
While VC funding has
$50 2,000 slowed in China, there
continues to be investor
$45 1,800
interest in areas like
$40 1,600 semiconductors, artificial
intelligence, and electric
$35 1,400 vehicles as these are areas
$30 1,200
the government has
continued to promote. In
$25 1,000 particular, ESG will likely
remain a hot area of
$20 800
investment for some time.
$15 600 In recent quarters, there
has been a number of big
$10 400
VC firms setting up funds
focused on ESG-related
”
$5 200
$10.0
$21.6
$17.6
$26.4
$13.5
$12.5
$13.2
$16.2
$19.5
$24.2
$44.1
$29.5
$24.4
$16.7
$12.0
$26.4
$18.1
$12.0
$14.0
$20.6
$34.7
$31.4
$24.1
$28.2
$32.1
$18.1
$4.0
$3.7
$3.7
$5.5
$9.2
$9.6
$9.2
$9.1
investments here.
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Allen Lu
Partner and Head of Technology, Media
& Telecommunications (TMT), Audit
KPMG China
#Q2VC
86
Venture financing in Australia

2014–Q2'22
$2,500 200
180
$2,000 160
140
$1,500 120
100
$1,000 80
60
$500 40
$1,246.1
$2,041.8
$1,445.1
$1,919.1
$160.6
$107.5
$123.0
$133.3
$213.1
$133.8
$255.7
$164.4
$124.2
$188.9
$256.7
$163.2
$268.2
$310.8
$309.0
$417.2
$530.8
$428.0
$378.4
$452.9
$632.9
$629.2
$609.8
$372.7
$577.4
$841.7
$852.4
20
$95.9
$76.7
$81.6
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
#Q2VC
87
“
Venture financing in Japan
2014–Q2'22
During Q2’22, the effect of the
$10,000 400 downward pressure on
valuations in the public
$9,000
350 markets started to trickle down
$8,000 into VC funding activity in
300 Japan. Companies in certain
$7,000
sectors — like healthtech —
$6,000
250 that were very successful
raising rounds up to Series B
$5,000 200 struggled to raise Series C
$4,000
and later funding rounds
150
during the quarter. Companies
$3,000 with global aspirations or that
100
were focused on global
$2,000
issues, like decarbonization,
$1,066.9
$1,056.2
$1,277.0
$1,082.6
$1,113.6
$1,095.2
$2,803.6
$1,138.0
$1,469.3
$1,393.8
$1,898.9
$9,212.7
$1,253.9
$1,416.3
50
were better able to raise late-
$139.9
$233.4
$278.9
$470.1
$220.8
$233.3
$195.8
$554.3
$506.5
$238.5
$779.1
$771.1
$337.8
$616.6
$524.8
$752.9
$543.2
$936.5
$870.9
$897.5
$1,000
”
stage funding.
$0 0
2014 2015 2016 2017 2018 2019 2020 2021 2022
Hiroshi Abe
Executive Board Member,
Partner
KPMG in Japan
#Q2VC
88
A slew of sectors see the impact of reshoring and domestic investment

Top 10 financings in Q2'22 in Asia-Pacific
3 1. Dailyhunt — $805M, Bengaluru, India — Consumer — Series J

9
8 2 2. CanSemi — $671.8M, Guangzhou, China — Manufacturing — Early-stage VC
7
3 3. Xendit — $300M, Jakarta, Indonesia — Fintech — Series D
1
3 3 3. Xpressbees — $300M, Pune, India — E-commerce — Late-stage VC
10
3. ShareChat — $300M, Bengaluru, India — Social — Series H
3. Megarobo — $300M, Beijing, China — Robotics — Series C
7. Stashfin — $270M, Delhi, India — Fintech — Series C
8. Gokin Solar — $251.3M, Zhuhai, China — Cleantech — Series A
9. Expace Technology — $248.2M, Wuhan, China — Spacetech — Series B1
10. Envision Digital — $210M, Singapore — AI & ML — Series A
#Q2VC
89
Global | US | Americas | Europe | Asia
From seed to speed, we’re here throughout your journey
Contact us:
Netherlands
Denmark
Germany
Sweden
Iceland Finland
Canada Norway
UK Latvia
Ireland Lithuania
Channel Islands Poland
Czech Republic
Conor Moore
Luxembourg Slovakia Head of KPMG Private Enterprise in the
France Americas,
Switzerland Ukraine China
US Romania South Korea Global Leader, Emerging Giants, KPMG
Portugal
Bermuda Turkey Japan Private Enterprise, KPMG International &
Spain Bangladesh Partner, KPMG in the US
Italy Greece Israel Taiwan
Mexico Austria Malta Cyprus (Jurisdiction)
Tunisia
India Hong Kong (SAR)
Venezuela
Cambodia Vietnam
South Africa
Singapore
Peru Lindsay Hull
Brazil Director, Emerging Giants Global
Network, KPMG Private Enterprise,
KPMG International
Chile Australia
Uruguay
New Zealand
#Q2VC
90
About KPMG Private Enterprise

You know KPMG. You might not know KPMG Private Enterprise. KPMG Private Enterprise advisers in KPMG firms around the world are
dedicated to working with you and your business, no matter where you are in your growth journey — whether you’re looking to reach new
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KPMG’s global resources through a single point of contact — a trusted adviser to your company. It is a local touch with a global reach.
KPMG Private Enterprise’s global network for emerging giants has extensive knowledge and experience working with the startup
ecosystem. Whether you are looking to establish your operations, raise capital, expand abroad, or simply comply with regulatory
requirements — we can help. From seed to speed, we’re here throughout your journey.
Register for the KPMG Private Enterprise Global Tech Innovators 2023
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pure technology company or you’re tech-enabled, tech-led or tech-driven, we want to hear from you.
We’re inviting you to compete with technology entrepreneurs across the globe. You’ll pitch your innovations and present your growth
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Wherever you are in your business lifecycle — from early-stage growth to getting ready to accelerate your expansion — our aim is to help
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Click here to register your interest for our 2023 competition.
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91
Acknowledgements
We acknowledge the contribution of the following individuals who assisted in the development of this publication:
• Jonathan Lavender, Global Head, KPMG Private Enterprise, KPMG • Lauren Taylor, Fintech Manager, KPMG in the UK
International
• Lindsay Hull, Director, Emerging Giants Global Network, KPMG Private
• Conor Moore, Head of KPMG Private Enterprise in the Americas, Global Leader, Enterprise, KPMG International
Emerging Giants, KPMG Private Enterprise, KPMG International & Partner,
• Melany Eli, Managing Director, Marketing and Communications, KPMG Private
KPMG in the US
Enterprise, KPMG International
• Amy Burnett, Head of KPMG Private Enterprise Access, KPMG in the UK
• Nicole Lowe, Head of Emerging Giants, KPMG in the UK
• Anna Scally, Partner, Head of Technology & Media & Fintech Lead, KPMG in
• Nitish Poddar, Partner and National Leader, Private Equity, KPMG in India
Ireland
• Peter Kehrli, Partner, KPMG in the US
• Dr. Ashkan Kalantary, Deal Advisory, M&A GrowthTech & Ventures, KPMG in
Germany • Rodrigo Guedes, Managing Director, KPMG in Brazil
• Diogo Garcia Correia, Venture Capital & Emerging Giants Business • Sunil Mistry, Partner, KPMG Private Enterprise, Technology, Media &
Development, KPMG in Brazil Telecommunications (TMT), KPMG in Canada
• Egidio Zarrella, Partner, Clients and Innovation, KPMG China • Tim Dümichen, Partner, KPMG in Germany
• Hiroshi Abe, Executive Board Member, Partner, KPMG in Japan • Warren Middleton, Lead Partner for Emerging Giants, Center of Excellence in
the UK, KPMG in the UK
• Irene Chu, Partner & Head of New Economy and Life Sciences, Hong Kong
(SAR) Region, KPMG China • Allen Lu, Partner and Head of Technology, Media & Telecommunications (TMT),
Audit, KPMG China
• Jules Walker, Senior Director, Business Development, KPMG in the US
• Dina Pasca-Raz, Head of Technology, Head of International Tax, KPMG in Israel
• Jonathan Boyers, Partner, Corporate Finance, KPMG in the UK
• Jussi Paski, Head of Startup Services, KPMG in Finland
#Q2VC
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Methodology
KPMG uses PitchBook as the provider of venture data for the Venture Pulse report • Angel/seed: PitchBook defines financings as angel rounds if there are no PE or VC firms involved in the company
to date and we cannot determine if any PE or VC firms are participating. In addition, if there is a press release that
Please note that the MESA and Africa regions are NOT broken out in this report. Accordingly, if you add up the Americas, states the round is an angel round, it is classified as such. Finally, if a news story or press release only mentions
Asia-Pacific and Europe regional totals, they will not match the global total, as the global total considers those other regions. individuals making investments in a financing, it is also classified as angel. As for seed, when the investors and/or
Those specific regions were not highlighted in this report due to a paucity of datasets and verifiable trends. press release state that a round is a seed financing, or it is for less than $500,000 and is the first round as
reported by a government filing, it is classified as such. If angels are the only investors, then a round is only
In addition, particularly within the European region, the Venture Pulse does not contain any transactions that are tracked as marked as seed if it is explicitly stated.
private equity growth by PitchBook. As such rounds are often conflated with late-stage venture capital in media coverage,
there can be confusion regarding specific rounds of financing. The key difference is that PitchBook defines a PE growth • Early-stage: Rounds are generally classified as Series A or B (which we typically aggregate together as early-
round as a financial investment occurring when a PE investor acquires a minority stake in a privately held corporation. Thus, stage) either by the series of stock issued in the financing or, if that information is unavailable, by a series of
if the investor is classified as PE by PitchBook, and it is the sole participant in the recipient company’s financing, then such a factors including: the age of the company, prior financing history, company status, participating investors, and
round will usually be classified as PE growth, and not included in the Venture Pulse datasets. more.
Also, if a company is tagged with any PitchBook vertical, excepting manufacturing and infrastructure, it is kept. Otherwise, • Late-stage: Rounds are generally classified as Series C or D or later (which we typically aggregate together as
the following industries are excluded from growth equity financing calculations: buildings and property, thrifts and mortgage late-stage) either by the series of stock issued in the financing or, if that information is unavailable, by a series of
finance, real estate investment trusts, and oil & gas equipment, utilities, exploration, production and refining. Lastly, the factors including: the age of the company, prior financing history, company status, participating investors, and
company in question must not have had an M&A event, buyout, or IPO completed prior to the round in question. more.
• Corporate: Corporate rounds of funding for currently venture-backed startups that meet the criteria for other
Fundraising PitchBook venture financings are included in the Venture Pulse as of March 2018.
PitchBook defines venture capital funds as pools of capital raised for the purpose of investing in the equity of startup • Corporate venture capital: Financings classified as corporate venture capital include rounds that saw both firms
companies. In addition to funds raised by traditional venture capital firms, PitchBook also includes funds raised by any investing via established CVC arms or corporations making equity investments off balance sheets or whatever
institution with the primary intent stated above. Funds identifying as growth-stage vehicles are classified as PE funds and other non-CVC method is employed.
are not included in this report. A fund’s location is determined by the country in which the fund is domiciled; if that
information is not explicitly known, the HQ country of the fund’s general partner is used. Only funds based in the United Exits
States that have held their final close are included in the fundraising numbers. The entirety of a fund’s committed capital is PitchBook includes the first full liquidity event (i.e. M&A, buyout, IPO) for holders of equity securities of venture-
attributed to the year of the final close of the fund. Interim close amounts are not recorded in the year of the interim close. backed companies. This does not include direct secondary sales, further share sales following an IPO, or
Mega-funds are classified as those of $500 million or more in size for the following fund categories: venture and bankruptcies. M&A value is based on reported or disclosed figures, with no estimation used to assess the value of
secondaries. transactions for which the actual deal size is unknown. Unless otherwise noted, IPO sizes are based on the pre-
money valuation of the company at the time of the transaction.
Deals
PitchBook includes minority equity investments, as well as investments combined of both equity and debt, into startup In the edition of the KPMG Venture Pulse covering Q1 2019 and all ensuing, PitchBook’s methodology regarding
companies from an outside source. Investment does not necessarily have to be taken from an institutional investor. This can aggregate exit values changed. Instead of utilizing the size of an IPO as the exit value, instead the prevaluation of an
include investment from individual angel investors, angel groups, seed funds, venture capital firms, corporate venture firms, IPO, based upon ordinary shares outstanding, was utilized. This has led to a significant change in aggregate exit values
and corporate investors, as well as from nontraditional investors such as hedge funds, mutual funds or private equity funds. in all subsequent editions yet is more reflective of how the industry views the true size of an exit via public markets. In
Investments received as part of an accelerator program are not included, however, if the accelerator continues to invest in the edition of the KPMG Venture Pulse covering Q1 2021 and all ensuing, the IPO exit type was updated to include all
follow-on rounds, those further financings are included. types of public listings, including special purpose acquisition companies (SPACs) and other reverse mergers.
#Q2VC
93
To connect with a KPMG Private Enterprise adviser in your region, email enterprise@kpmg.com.
Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.
home.kpmg/venturepulse
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and
timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such
information without appropriate professional advice after a thorough examination of the particular situation.
KPMG refers to the global organization or to one or more of the member firms of KPMG International Limited (“KPMG International”), each of which is a separate legal entity. KPMG International
Limited is a private English company limited by guarantee and does not provide services to clients. For more detail about our structure please visit home.kpmg/governance.
Throughout this document, “we”, “KPMG”, “KPMG Private Enterprise”, “us” and “our” refers to the global organization or to one or more of the member firms of KPMG International Limited
(“KPMG International”), each of which is a separate legal entity.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization.

Venture Pulse q2 2022

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Venture Pulse q2 2022

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Global analysis of venture funding

July 20, 2022

Venture investment slows but does not collapse

Angel & seed Early VC Later VC Down Flat Up

Global median deal size ($M) by series

Global median pre-money valuation ($M) by series

Global deal share by series Global deal share by series

100% Transportation 100%

90% Commercial 90%

$120 3,000 $70 16,000

Exits slow amid market volatility

$80 300 $450 1,200

Acquisition Buyout Public listing Acquisition Buyout Public listing

Global venture fundraising

$200 Allocators continue to pile into the venture

Capital raised ($B) Fund count

Top 10 global financings in Q2'22

1. Epic Games — $2B, Cary, US — Entertainment software — Late-stage VC

2. SpaceX — $1.7B, Hawthorne, US — Aerospace — Late-stage VC

6. Dailyhunt — $805M, Bengaluru, India — Consumer — Series J

7. Ramp — $748.3M, New York, US — Fintech — Series C

8. Kitopi — $715M, Dubai, United Arab Emirates — Foodtech — Series C

9. The Boring Company — $675M, Burlingame, US — Infrastructure — Series C

10. CanSemi — $671.8M, Guangzhou, China — Manufacturing — Early-stage VC

Trends to watch for in Q3’22

Median pre-money valuation ($M) by series in the US

Note: Figures rounded in some cases for legibility.

Deal share by series in the US Deal share by series in the US

90% Series D+ Series D+

70% 70% Series C

Angel & seed Angel & seed

Venture financing by sector in the US Venture financing by sector in the US

Venture-backed exit activity in the US

Exit value ($B) Exit count

Acquisition Buyout Public listing Acquisition Buyout Public listing

surpassed $120 billion in capital

Capital raised ($B) Fund count

First-time Follow-on First-time Follow-on

Venture financing in the Americas

… after a strong start to the year

Median deal size ($M) by series in the Americas

Median pre-money valuation ($M) by series in the Americas

70% Series C 70%

Deal value ($M) Deal count

Venture financing in Mexico

Deal value ($M) Deal count

Deal value ($M) Deal count

Top 10 financings in Q2'22 in Americas

3 1. Epic Games — $2B, Cary, US — Entertainment software — Late-stage VC

4. Faire — $816M, San Francisco, US — E-commerce — Series G

5. Ramp — $748.3M, New York, US — Fintech — Series C

6. The Boring Company — $675M, Burlingame, US — Infrastructure — Series C

7. Resilience — $625M, San Diego, US — Pharmaceuticals — Series D

8. Anthropic — $580M, San Francisco, US — Information services — Series B

9. Crusoe Energy Systems — $505M, Denver, US — Cleantech — Series C

10. Group14 Technologies — $400M, Woodinville, US — Cleantech — Series C

Drop in VC investment in Europe amid rising uncertainty , cont’d.

Venture financing in Europe

Angel & seed Early VC Later VC

Median deal size ($M) by series in Europe

Median pre-money valuation ($M) by series in Europe

Deal share by series in Europe Deal share by series in Europe

70% Series C 70%

50% Series B 50%