The number of startup funding rounds backed by corporate investors dropped 43% year-on-year in February. Deal value was down by two-thirds.

Only 332 startup funding rounds received backing from corporate investors in February, down 43% from the 582 rounds registered in the same month of 2022. Investment value stood at $8.59bn in total estimated capital –about a third of the $24.6bn of the same period last year. The February numbers represented a 10% drop in deal numbers and a 17% drop in deal value from January. Corporate investors are backing away from startup deals more or less in tandem with the rest of venture capital investors. There was a similar drop in total VC deals which were 48% lower in February 2023 than in same month of 2022. The total estimated capital in those deals for the second month of this year ($19.9bn) was similarly only slightly more than a third of the estimated value of February last year ($54.2bn). Vis-a-vis January of this year, the February total VC deal count dropped about 16%, whereas dollar value decreased by 11%. In virtually all of the major venture geographies, there were fewer deals this February than in the same month of the previous year. One of the biggest drops came in the US where there were 110 fewer deals — a 46% decline — than in the same month last year. China has seen deal numbers more than halve, albeit from a lower starting point than the US. The leading corporate investors by number of deals were crypto exchange Magic Eden, internet conglomerate Alphabet and semiconductors and electronics manufacturer Samsung. GCV reported 15 corporate-backed funding initiatives in February, including VC funds, new venturing units and incubators. This was a slightly higher number than in previous months but still much lower than the 50 initiatives recorded in February 2022.   Deals Emerging businesses from every sector raised fewer funding rounds in corporate-backed round this February than in the same month of last year. The most active corporate venturers were in the financial, IT, media and healthcare sectors, as shown on the heatmap. The top deals of February were concentrated in emerging businesses primarily from the energy and IT sectors. Zeekr, the luxury electric vehicle subsidiary of China-based carmaker Geely, raised $750m in a series A round featuring battery manufacturer Contemporary Amperex Technology. Yuexiu Industrial Fund, Tongshang Fund and Xin’an Intelligent Manufacturing Fund filled out the participants. SandboxAQ, a US-based provider of quantum computing simulation software that was spun off by internet and technology group Alphabet, raised $500m in funding. The cash came from investors including…

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Kaloyan Andonov

Kaloyan Andonov is head of analytics at Global Corporate Venturing.