Don't Expect A Quick Recovery In Financing For Startups

• Published date: 04 October 2022
• Subject Matter: Finance and Banking, Financial Services
• Law Firm: Brown Rudnick LLP
• Author: Mr Ben Hron

In 2021, investors pumped a record $330 billion into U.S. tech startups - twice as much as the previous year, which was itself twice the level of three years earlier. But investments in startups has plummeted this year.

This Financial Times article points to an important, and sometimes overlooked, difference between the current downturn and past downturns: the amount of capital invested into startups the past several years by investors other than traditional venture capital funds.

Corporate VCs, hedge funds, sovereign wealth funds, mutual funds and others that historically invest most or all of their money in public companies and mature private companies have invested billions in startups in an...