This is a weekly feature that runs down the week’s top 10 announced funding rounds in the U.S. Check out last week’s biggest funding rounds here.

This week there was a slowdown in big rounds raised by U.S. startups. In fact, it only took raising about $45 million to make the list. That’s still a lot of cash, but clearly round size trended down.

1. Metsera, $290M, biotech: This week was a slower week than normal for biotech — as it was for most sectors —  but that didn’t stop New York-based Metsera. The clinical-stage biopharmaceutical startup emerged from stealth this week with $290 million in funding led by Arch Venture Partners. The company is exploring medicines for obesity and metabolic diseases with a collection of oral and injectable incretin, nonincretin and combination therapies.

2. Rivos, $250M, semiconductor: Semiconductor startups are seeing big money, in part thanks to the explosion in generative AI. This week, Santa Clara, California-based chip startup Rivos raised more than $250 million in a Series A-3 funding led by Matrix Capital Management. The company develops power-optimized chips targeting the data analytics and generative AI markets. Of course, chip startups have seen increasing interest recently. Late last month, optical interconnectivity startup Celestial AI raised a massive $175 million Series C led by Thomas Tull’s US Innovative Technology Fund. Also last month, Astera Labs — a developer of data center connectivity technology with use cases in generative AI — soared after its initial public offering on the Nasdaq.

3. Ramp, $150M, fintech: New York-based spend management startup Ramp saw a nice bump in its valuation this week, raising a $150 million round at a post-money valuation of $7.65 billion — neary 32% higher than its value in August. Last summer, the corporate card and expense automation platform raised $300 million at a $5.8 billion post-money valuation — which was actually a 28% drop from its previous valuation. The round was led by new investor Khosla Ventures and existing backer Founders Fund. Founded in 2019, the company has raised $1.8 billion, per Crunchbase.

4. Two Chairs, $72M, healthcare: Finding the right therapist can be hard, but San Francisco-based behavioral health startup Two Chairs closed a $72 million Series C to help. The round was a mix of debt and equity. The equity portion — which was not specified — was led by Amplo with Fifth Down Capital. The startup uses its own matching platform helped by its proprietary algorithm to help match the  right therapist with the patient. It now has more than 500 clinicians on staff. Founded in 2017, Two Chairs has raised $103 million, per the company.

5. Cape, $61M, mobile: We are aware of the issues that telecom companies have had protecting customer information. Well, Arlington, Virginia-based Cape is hoping to fix that. The company is developing a privacy-first mobile network, and raised a $61 million round led by A* and Andreessen Horowitz. Cape’s founder and CEO, John Doyle, formerly was head of Palantir Technologies’ national security business. It’s the company’s first announced round, per Crunchbase.

6. Avive Solutions, $57M, healthcare: San Francisco-based Avive Solutions, a developer of connected automated external defibrillators, raised a $56.5 million growth equity financing led by Catalyst Health Ventures, Laerdal Million Lives Fund and Questa Capital Management. Founded in 2017, the company has raised $90 million, per Crunchbase.

7. Asher Biotherapeutics, $55M, biotech: South San Francisco-based Asher Biotherapeutics — a biotechnology startup developing targeted immunotherapies for cancer, autoimmune and infectious diseases — had the secondest biggest biotech raise of the week. The startup closed a $55 million Series C led by RA Capital Management. Founded in 2019, the company has raised $218 million, per Crunchbase.

8. Corner Therapeutics, $54M, biotech: Watertown, Massachusetts-based Corner Therapeutics, an immunotherapy company, raised $54 million led by Ziff Capital Partners. Founded in 2020, this is the first announced round by the company, per Crunchbase.

9. Kontakt.io, $48M, artificial intelligence: New York-based Kontakt.io, which gives health systems analytics on how staff and patients move through facilities, raised a $47.5 million round led by growth equity at Goldman Sachs Asset Management. Founded in 2013, the company has raised nearly $69 million, per Crunchbase.

10. Anvilogic, $45M, cybersecurity: Palo Alto, California-based security information and event management startup Anvilogic closed a $45 million Series C led by Evolution Equity Partners. Founded in 2019, Anvilogic has raised $85 million, per the company.

Big global deals

The biggest round outside the U.S. went to a drone company across the pond.

• London-based Skyports, an urban air mobility drone delivery service, raised a Series C worth approximately $109 million.

Methodology

We tracked the largest announced rounds in the Crunchbase database that were raised by U.S.-based companies for the seven-day period of April 13 to 19. Although most announced rounds are represented in the database, there could be a small time lag as some rounds are reported late in the week.

Illustration: Dom Guzman

From inaccuracy-laden AI-generated verbiage to deliberate deepfakes and disinformation,  conducting research isn’t what it used to be. Even keeping up with the news now usually entails wading through reams of misleading or outright false content. 

We’re fed up. And increasingly, our frustrations are inspiring startup investors to back businesses aimed at weeding out misinformation. 

It’s not a new phenomenon. A year ago, we wrote about funded startups working on ways to combat disinformation and misinformation, some of which had raised quite a bit of capital. Since then, however, money has continued to pour into the space.

AI tools to fight AI falsehoods

To get a sense of what investors are into, we put together a list of 16 companies, most of which last raised financing in the past year. To date, the selected startups have collectively raised more than $250 million.

Overall, it’s a group heavily focused on artificial intelligence, reflecting the growing role of AI in both creating and combating misinformation. It’s also a pretty youthful cohort, with the majority of funding going to seed and early stage rounds.

Notably, several larger financings closed just this year. In February, for instance, Clarity, a provider of software to identify and protect against harmful deepfakes and AI-generated synthetic media, picked up $16 million in a seed funding round. Bessemer Venture Partners and Walden Catalyst led the financing for the New York-based company, which was founded less than two years ago.

A few weeks earlier, Reken, a stealthy startup founded by a former head of Google’s product trust and safety group, landed $10 million in a seed round. Greycroft and FPV Ventures led the investment in the San Francisco company, which is building a platform to protect against generative AI threats. 

In a similar vein, Tel Aviv-based Cyabra, a self-described social threat intelligence provider, announced in January that it had closed a $5.7 million Series A extension round (and also added former Secretary of State Mike Pompeo to its board of directors.) And just last week, Los Angeles-based PeakMetrics, a developer of tools for organizations to find and respond quickly to damaging social media content, picked up $3 million in seed funding.

Reputational damage control

For now, it’s common to see business models based on protecting reputations of well-known brands, businesses, and individuals. More than half the startups on our list are pursuing this strategy to some extent. 

This looks at first glance like a sensible approach. Founders, of course, raise money by convincing investors they can generate revenue. To do this, they have to make a case that those who stand to lose the most money from false online narratives — i.e. businesses and brands — will benefit from buying their products. 

Looking ahead, however, it would also be gratifying to see more technologies for reducing the scourge of online falsehoods reach audiences that aren’t directly paying for their software. This would be particularly helpful for AI-generated content, which we expect to grow at exponential rates and, as of yet, is not known for its accuracy.

Related Crunchbase Pro list:

• Funded Companies Fighting Disinformation

Illustration: Dom Guzman

Last year, investors poured more than $4.6 billion globally into startups in the space travel and satellite categories, as well as space-related aerospace sectors, per Crunchbase data. Supersize rounds went to companies developing everything from satellite networks to space stations.

Space infrastructure was the hottest area, per Chad Anderson, managing partner at early investor Space Capital, who calculated that last year’s investment totals were second only to the 2021 peak. He attributes the enthusiasm to broader bullishness around defense tech and sectors with government funding.

“In this challenging revenue market, everyone is chasing government dollars,” Anderson said, observing that: “Governments are continuing to spend regardless of market cycles.”

Using Crunchbase data, we charted out investment to select space categories for the past five calendar years.

Looking at the chart, it’s notable that although it shows a year-over-year decline in 2023, this is mostly due to two big 2022 fundraises that don’t cleanly fit into the space startup category. One is SpaceX, which at 22 years old is arguably not a startup. The other is Anduril Industries, a defense unicorn that is not primarily spacetech-focused but has received funding to deploy its software in space surveillance systems.

By contrast, nearly all of the biggest space funding rounds for 2023 went to Series A through Series D stage companies that are solely focused on the sector.

Supergiant space rounds

The lineup includes some rather large financings. Standouts include:

• Axiom Space, a Houston-based startup building a commercial space station, picked up $350 million in an August financing. The company also has a long-term NASA contract worth $1.26 billion to provide “Exploration Extravehicular Activity Services” and spacesuits for use on the moon and in other space programs.
• Sierra Space, of Louisville, Colorado, landed a $290 million Series B in September that values the company at $5.3 billion. Sierra says it’s developing the first commercial space station and is also transitioning its Dream Chaser space plane for use in NASA cargo resupply flights to the International Space Station.
• Astranis, a San Francisco startup building a network of satellites to provide internet access in remote regions, locked up a $200 million venture round in April at a $1.6 billion valuation.
• Isar Aerospace, a Germany-based launch service provider for small and medium-sized satellites, secured $168 million in a March Series C financing.

One common factor among the well-funded startups above is that all are infrastructure plays, which goes against the stereotype of startup investors as an infrastructure-averse crowd.

Partly, it is because the cost of launching a satellite has decreased dramatically over roughly the past decade, making the economics more appealing to startup backers. Another factor may be the enduring success of SpaceX, said to be valued recently at around $180 billion, which proves that big outcomes are possible.

But where are the apps?

While space infrastructure funding is going strong, Anderson said applications that use satellite data have not attracted much interest from startup investors lately.

That sector isn’t necessarily reflected in Crunchbase data though, which doesn’t categorize many power users of satellite data as spacetech companies. For instance Uber and Yelp, both of which rely heavily on satellite-enabled GPS data for their apps, aren’t listed as space companies.

However, Anderson makes the case that to understand the space economy as a whole requires looking at the value created by all businesses that incorporate satellite information. This includes GPS, a technology he posits has generated trillions in economic value.

Down the road, Anderson is optimistic that the out-of-favor app economy startup sector will see a lift as more satellite-enabled information streams mature. In particular, he’s enthused about geospatial satellite intelligence, an enabling technology with applications in insurance, climate change modeling, crop management and much more.

Launches, not exits

One thing we’re not seeing much of in the space sector lately is exits.

The combination of a weak M&A environment and quiet IPO market means startups and their backers probably aren’t thinking much about immediate investment returns. At least for now, however, it looks like venture investors are willing to keep the funding flowing as space startups launch the next phases of their business plans.

Related Crunchbase Pro query:

• Spacetech Funding, 2023

Related reading:

• Axion Space Locks Up Huge $350M Round From Aljazira Capital And Boryung
• Share Of Funding To App Startups Hit Lowest Point In A Decade

Illustration: Dom Guzman

That, broadly, is the finding from our latest data dive into venture funding tied to the metaverse, virtual worlds and augmented reality. Investment around these themes hit a multiyear low in 2023, driven by declining support for consumer-focused startups.

For perspective, below we mapped out the past six years of funding to the space.

U.S. metaverse-related investment also contracted sharply. The largest late-stage venture round in the space last year was an $82 million Series D for Augmedics, a developer of augmented reality image guidance technology for surgery. Intriguing indeed, but hardly a recreational application.

Meanwhile, there were no U.S. rounds of $100 million or more in 2023 for consumer-facing companies developing virtual worlds. And as illustrated below, the six-year chart shows a clear downward slope.

We don’t talk about the metaverse

Lower funding feeds into a narrative of the metaverse as yet another example of a much-hyped tech breakthrough that never gained mainstream adoption.

After all, it was just over two years ago that Mark Zuckerberg famously renamed Facebook as Meta. The move came with a founder’s letter envisioning a future in which one could “teleport instantly as a hologram to be at the office without a commute, at a concert with friends, or in your parents’ living room to catch up.”

Fast-forward to today, and Meta’s initially legless metaverse, Horizon Worlds, hasn’t proven popular. To date, the company has lost tens of billions on its metaverse efforts.

It’s not just Meta. Across brands, U.S. sales of VR headsets and augmented reality glasses have reportedly plummeted. In the startup sphere, the most heavily funded company is Magic Leap, which has raised $3.5 billion to date but hasn’t shown traction.

Even the term “metaverse” looks poised for a reboot, with hawkers of headsets and associated software opting for terms like “spatial computing” and “three-dimensional user interface.”

Enter Apple

But before we give up on visions of a headset-enabled, immersive digital reality, it’s time for Apple to have its moment.

Last week, the world’s most valuable technology announced a Feb. 2 public release for its much-anticipated Apple Vision Pro headset. CEO Tim Cook modestly described the $3,500-plus  wearable as “the most advanced consumer electronics device ever created.”

Remarkably, Apple’s product announcement for Vision Pro does not include a single mention of the terms “metaverse,” “virtual reality” or “augmented reality.” However, the company did use the term “spatial computing” eight times, and “magical” four times.

Apple is famous for its marketing savvy, so we’ll have to assume these word choices to be deliberate. We can also take it as recognition that “metaverse” is not a buzzword that sells headsets.

Notably, Apple is also pitching the appeal of a headset that allows users to transition with relative ease between 3D digital environments and actual reality. It has designed Vision Pro so that when a person approaches a wearer, the device looks transparent. The wearer’s eyes are revealed, and they can see the person approaching.

A seamless transition from a digital world to the real one would go a long way to assuaging complaints that immersion in virtual worlds can be excessively isolating. This is one of the core reasons many of us prefer consuming content in 2D, as one need only look away from the screen to engage with immediate surroundings.

As for another core complaint around immersive 3D computing — that it can be a physically uncomfortable and even nauseating experience — we’ll soon see if Vision Pro manages to assuage these qualms.

Now back to startups

If Vision Pro does prove a hit, that should provide a boost for startups innovating around immersive digital worlds. While the initial audience size will be limited by the device’s hefty price tag, it’s reasonable to expect cheaper costs as the user base scales.

But this time around, don’t be surprised if the hotter startups aren’t pitching themselves as metaverse companies. Instead, they’ll likely be talking up spatial computing and immersive digital environments. We’ll see if funding follows.

Related Crunchbase Pro query:

• Metaverse, Virtual Reality, And Augmented Reality Funding, 2023

Related reading:

• VCs No Longer Do DTC
• Metaverse Investing Has Slowed. Can Apple Save It?
• VR/AR Funding Falls As Metaverse Mass Adoption Still Not Reality

Illustration: Dom Guzman

The company’s valuation was not disclosed, but Bloomberg reported it was not $1 billion.

Other investors participating in the round include Eclipse Ventures, Acme Capital, Menlo Ventures, Narya Capital, 645 Ventures, Rocketship.vc, Champion Hill Ventures and FiveNine Ventures. Founded in 2022, the company has raised $158 million to date.

The Centennial, Colorado-based startup helps the government and commercial customers keep an eye on threats to assets like satellites they have in space. The company’s Jackal autonomous orbital vehicles, which can detect objects in space, are slated to launch aboard SpaceX‘s Transporter-10 mission next year.

“Space is the newest and most vulnerable theater of contemporary global competition, but the U.S. and its allies are ill-equipped for a conflict that begins in or extends into space,” said co-founder and CEO Even Rogers. “True Anomaly is solving this by building the technologies for a more secure, stable, sustainable and transparent space environment.”

Space and defense

True Anomaly is the latest startup that straddles the defense and space industries to raise big cash.

Late last month, rocket propulsion startup Ursa Major said it had added another $38 million to its previously reported $100 million Series D — bringing its total Series D and D-1 funding to $138 million.

Both sectors are down quite a bit in funding compared to last year. Crunchbase data shows that while U.S.-based defense tech startups saw only $2.2 billion invested last year — including Anduril Industries’ $1.5 billion Series E — that number has dropped to less than $900 million so far this year.

Space tech funding also has slowed, per Crunchbase data. Last year, nearly $9.2 billion in funding went to the sector, but this year has seen only about $5.2 billion.

Related Crunchbase Pro queries:

• Defense Tech Funding In 2022
• Space Tech Funding

Related reading:

• Defense Tech Startup Anduril Raises Massive $1.5B Round At $8.5B Valuation
• Ursa Major Rockets Up Latest Raise To $138M

Illustration: Dom Guzman

The new valuation — as reported by Bloomberg — is a significant jump from late May, when the company extended its Series B at a $2 billion valuation.

The secondary offering also included participation from Investment Management Corporation of Ontario, Jane Street, J.P. Morgan Asset Management, Nat Friedman, Daniel Gross, Goanna Capital, Zoom Ventures and others.

“Our explosive growth trajectory has been recognized by top-tier institutional investors, and this transaction highlights the differentiation our market-leading performance, significant technology advantage, and strong customer adoption is receiving in the market,” said co-founder and CEO Michael Intrator in a release.

Big money

The massive jump in valuation — and high interest from big institutional investors — seems to indicate that while some predict a cooling off in AI investment, many are still willing to write big checks at big valuations.

In another reported offering of existing shares, Thrive Capital and others are still moving forward with a tender offer to buy OpenAI employee shares at a price that values the company at $85 billion.

The big-money transaction is just the latest for CoreWeave.

In April, CoreWeave raised $221 million led by Magnetar Capital. Just weeks later, CoreWeave raised another $200 million in a Series B extension.

Then in August, CoreWeave raised a $2.3 billion debt facility led by Magnetar and Blackstone and collateralized by chips from Nvidia — also an investor in the company.

Founded in 2017, the company has raised a total of nearly $3 billion in debt and equity.

The specialized cloud provider — which actually started out as an Ethereum mining operation — offers flexible infrastructure with better processing needed to train large language models for AI.

Related reading:

• Specialized Cloud Provider CoreWeave Rides AI Wave To Another $200M Round
• Specialized Cloud Provider CoreWeave Locks Down $221M Investment

Illustration: Dom Guzman

With the price of new premium cellphones soaring past the $1,500 mark, settling increasingly involves buying used. While it might not have the allure of an iPhone 15 Pro, that $400 smartphone from 2021 will probably do just fine.

The value proposition of refurbished gadgetry hasn’t been lost on startup investors. They’ve put billions into the space over the years — pitching offerings as both a way to reduce electronic waste and serve a high-demand consumer market.

Recently, investors have been especially busy. Last week, Vienna-based Refurbed, a platform for buying refurbished cellphones and gadgets that come with guarantees, picked up $57 million in a Series C funding round.

It’s the latest in a run of good-sized financings this year for companies in the space. Per Crunchbase data, at least eight have raised multimillion-dollar rounds, with the money going to startups spanning from Sweden to São Paulo to Silicon Valley.

Looking further back, it’s evident this has been an active funding arena for several years. For a sense of who’s getting capital, we put together a list of 19 refurbished-gadget-focused companies at seed through late stage that last raised funding in the past two calendar years.

A simple pitch: reducing waste and saving money

For most companies selling refurbished goods, the pitch is pretty straightforward: Consumers can save money, while sellers can tout the positive environmental impact of keeping electrics in circulation and out of landfills. Platforms also often commonly provide a channel for people to sell their used gadgets.

On the cost front, prices are usually far lower than new, but often the merchandise skews older as well. Paris-based Back Market, for instance, says its warrantied and tested products cost up to 70% less than brand-new items. Much of the product lineup consists of models launched a few years ago that brands are no longer actively marketing.

Refurbed says its products are up to 40% cheaper than comparable new devices. And Helsinki-based Swappie, focused on the iPhone market, appears to mostly sell models a few years old for several hundred dollars.

Besides savings, sellers tout the environmental benefits of refurbished. Per Swappie, for instance, as much as 85% to 95% of carbon emissions caused by mobile phones are produced during their production — an impetus to keep them in use as long as feasible.

Big competition

As they work to scale, startups are facing a seriously competitive landscape. Not only are they competing with other startups, they must also share the space with the most valuable technology companies on the planet.

Today, both Apple and Amazon operate active reseller platforms. Their impact is hefty enough that the two are facing a U.S. class-action lawsuit charging that Apple violated antitrust law through an agreement limiting the number of authorized resellers on Amazon’s marketplace. In addition, other well-established sellers with refurbished offerings include eBay and Best Buy,

If recent funding activity is any indication, however, investors appear confident that more recent entrants to the space will have not only a place in the market, but the potential for a leading role.

Related Crunchbase Pro query:

• Refurbished Electronics-Related Funded Startups

So far in 2023, Seattle-based startups have pulled in $1.1 billion in seed through growth-stage financing, per Crunchbase data. That’s a decline of 57% from the same period last year, which was itself well below the 2021 peak.

For a sense of how the numbers are trending, we charted out citywide investment totals and round counts for the past six calendar years below:

Meanwhile, for the state of Washington, trendlines look similar, showing the declines aren’t limited to Seattle proper.

Of course, venture funding has fallen sharply pretty much everywhere this year. The first half of 2023 was down 51% year over year globally.

Late-stage and mega-rounds dry up

This begs the question: Is the Seattle-area decline just a reflection of broader geographic trends, or does it point to specific weaknesses in the local startup ecosystem?

While we can’t offer a definitive answer, we can peruse large deals and demographic trends to see what clues they offer.

We turned first to look at the state of mega-sized funding rounds, which tend to happen at the late stage.

It wasn’t pretty. So far this year, Washington state has seen just one $100 million-plus round: A $102 million August Series D for Pivotal Commware, which develops software-defined antennas and radios based on a technology it calls Holographic Beam Forming.

By contrast, in 2021 and 2022, there were 43 funding rounds of $100 million or more. This included a $750 million Series A last year for nuclear energy startup TerraPower.

Still, there are some sizable rounds getting done this year. After Pivotal, the next-largest 2023 round was an $86.5 million Series C for Viome, a gut microbiome health startup. There were also two $75 million financings, one to DexCare, a health care software platform, and another to Temporal Technologies, a developer of tools for coders.

Early-stage action

So far this year, we’ve seen 35 Series A and B rounds in Washington, collectively pulling in $820 million. That’s roughly a third of the total from the same period a year ago.

Things are down even further compared to the peak. In 2021 and 2022, Washington companies pulled in nearly $6.5 billion altogether in Series A and B deals.

Seed stage hasn’t declined quite so much. Washington companies have pulled in roughly $281 million in seed investment in 2023 — a drop of roughly 35% from the same period last year. That’s similar to what we’ve seen in other locales, as seed investors don’t expect near-term exits and are less impacted by market cycles.

Growth, livability and exits

As cities go, Seattle isn’t for everyone. Traffic is bad, winters are gray, crime rose in recent years, and homebuying is out of reach for most workers. In 2021, the population of the city and surrounding King County actually declined for the first time in nearly half a century, fueled in part by remote workers seeking sunnier pastures elsewhere.

On the other hand, there’s much to like as well, from spectacular summers, abundant natural beauty and an urban populace known for both its creative energy and tech talent. By the most recent measure, the Seattle-area population is increasing again, and Washington ranks among the fastest-growing U.S. states.

On the exit front, meanwhile, the Seattle area has seen a steady clip of local companies making it to public markets. Per Crunchbase data, there have been at least 20 IPOs of local, venture-backed companies over the past five years.

While none are showing signs of becoming the next Amazon or Microsoft, there are some with market caps over $1 billion on the list. This includes cross-border payments service Remitly,  B2B contact provider ZoomInfo, and pet care marketplace Rover.

So, all this is to say the data doesn’t support a narrative that startup folks are fleeing Seattle or Washington state in droves. However, funding activity has definitely slowed in recent quarters, more so than many other founder hubs, and we wouldn’t be surprised it takes a while longer to rebound.

Related Crunchbase Pro queries:

• Seattle Startup Funding
• Washington State Startup Funding
• Washington State VC-Backed IPOs Of The Past Five Years

Illustration: Li-Anne Dias

Investors, who did have a choice, opted to put a lot of money into startups aiming to make the virtual and hybrid event experience more productive and enjoyable. In 2020 and 2021 alone, more than $1.5 billion went to upstarts in the space, per Crunchbase data.

But among these startups, no one was beloved like Hopin. The London-based virtual events platform pulled in over $1 billion in 2020 and 2021 from lead backers including Andreessen Horowitz and General Catalyst. By late 2021, its valuation had skyrocketed to $7.75 billion.

Less than two years later, a much different narrative is playing out. Live events have bounced back, and Hopin’s valuation has cratered. This week, the company said it agreed to sell its core events product, along with other assets, to RingCentral, a cloud communications platform for businesses that is looking to expand its events offerings.

A pandemic-era investor favorite

Hopin’s trajectory doesn’t bode well for other funded companies in the virtual and hybrid event space that raised big rounds during the pandemic.

It’s a large group. To get a sense of the major players, we used Crunchbase data to put together a list of 31 companies with an online events focus that raised a few million dollars or more. The vast majority have not raised funding since 2021.

The top funding recipients also have been cutting staff. Hopin reportedly cut 29% of its staff last summer, just months after an earlier round of layoffs.

Bizzabo, a B2B-focused events platform with hybrid and virtual offerings, reportedly laid off 40% of its staff late last year. The Israel-based startup was the second most heavily funded company on our list after Hopin, with $194 million in known venture funding.

Another startup, Hubilo, a virtual events platform that raised nearly $150 million in 2021, reportedly laid off 35% of its staff early this year.

Hybrid events are sticking around

Still, even though hybrid and virtual events businesses haven’t taken off like their venture backers hoped, offerings aren’t going away either.

These days, with Covid lockdowns behind us, we’re getting a better sense of where people want to gather and where they don’t. Restaurants and concerts are back, big time. The office, not so much.

Conferences and business events, meanwhile, fall into an in-between zone. Yes, people would prefer to network face-to-face, and there’s a lot of value to meeting others in the same field in person.

However, travel and lodging costs add up. Attending in-person may also not be ideal for someone who’s just interested in a couple of sessions. So there’s still a place for hybrid and virtual gatherings.

The value of platforms that enable such gatherings, however, seems quite a bit lower than what was presumed a couple years ago. While the Hopin purchase price wasn’t disclosed, the deal almost certainly valued assets at a tiny fraction of the full company’s peak valuation.

RingCentral’s total market capitalization is around $3.8 billion — less than half what Hopin was worth at its peak. Also, as a public company, RingCentral is obligated to disclose a purchase price if the deal was deemed large enough to have a material impact for investors. Apparently, it was not.

Although RingCentral isn’t buying the entirety of Hopin, it’s buying the parts that it was best known for — events. What remains of Hopin will be carrying on, including streaming assets and a community project called Superwave. Chief Technology and Product Officer Badri Rajasekar will be taking over as CEO, and founder and CEO Johnny Boufarhat will be stepping down from operations.

Related Crunchbase Pro list

• Hybrid And Virtual Events-Related Funded Companies

Illustration: Dom Guzman

It’s no secret venture has cooled considerably since late 2021, but so have possible exit opportunities for startups. While the IPO pipeline is still frozen, M&A involving U.S.-based, VC-backed companies is on pace for its slowest year since 2013, per Crunchbase data.

And it only appears to be getting worse.

Through the first two quarters of the year, only 429 U.S.-based, VC-backed startups have been scooped up in M&A deals. That puts the M&A market on its slowest pace since 2013, when only 698 deals involving startups occurred — as the world’s economy was coming out of the global financial crisis of 2008-09.

Those numbers are a far cry from the more than 1,700 deals we saw just two years ago, and even the robust 1,134 witnessed last year as the venture market slowed.

All of that isn’t to say there haven’t been any big M&A deals. In fact, so far this year we have seen five deals of more than $1 billion:

• Brookfield Infrastructure Partners agreed to buy Dallas-based Compass Datacenters, a wholesale provider of dedicated data centers for businesses, for $5.5 billion last month. The deal is expected to close by the end of the year.
• Savvy Gaming Group agreed to acquire Culver City, California-based gaming company Scopely for $4.9 billion in April.
• Altria agreed to buy Scottsdale, Arizona-based Njoy, an e-cigarette and vaping startup, for $2.8 billion in March.
• T-Mobile agreed to buy Costa Mesa, California-based Mint Mobile, a prepaid wireless brand, for $1.4 billion in March.
• Databricks bought San Francisco-based language models training startup MosaicML for $1.3 billion last month (although that deal likely is worth less depending on the current valuation of Databricks).

Numbers going down

The Databricks deal sparked talk that M&A could be making a rebound, especially with AI leading the charge. While that certainly still could happen, the numbers appear to be trending in the wrong direction, according to Crunchbase numbers.

The just-completed second quarter saw only 196 deals consummated — the lowest total in years and the continuation of what appears to be a steady decline in M&A activity quarter to quarter, per Crunchbase data.

Looking for signs

However, just because that seems to be the trend doesn’t mean M&A will continue along those lines.

It made sense that dealmaking would pause or reset as interest rates kept increasing and money became more expensive. Just as consumers stop making big purchases — like homes or cars — as interest rates increase, so do corporations.

Dealmaking also started to decline last year just as many tech stocks were getting hammered in the public market and many startups held firm to ridiculously high valuations.

A drop in share prices is usually an ill-advised time for M&A, since public companies do not want to do stock deals — essentially doing a deal at a discount. Add to that the fact that cash deals are also sometimes not warmly embraced by public investors, and it’s not surprising a slowdown occurred.

However, some of that has changed.

Interest rates have held — although it does seem like a sure thing they will rise again. Also, many public tech companies’ shares have rebounded this year — making stock deals more likely.

On top of all of that is the fact a new reality does seem to be sinking in with founders. The valuations many received at the market’s high in 2021 are just not realistic anymore, and holding out for such a price is likely nothing more than a pipe dream.

As companies who raised during the heyday of the market watch their war chests start to dwindle, many startups already have raised flat rounds and even downrounds — accepting their valuations were out of whack with the real world.

That same understanding likely is or will be applied to M&A dealmaking when large tech companies or other strategics come calling. The price may not be at the elevated 2021 numbers, but may be a good alternative to a very competitive funding market and a fair price for what reality is today.

Related Crunchbase Pro list:

• M&A Involving US-Based, VC-Backed Startups

Related reading

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• M&A Exits For VC-Backed Cyber Startups Continues To Sputter
• Why Startups May Soon Be Buying More Startups
• These Lead VCs Have The Most Acquisitive Startups

Illustration: Dom Guzman