Wisconsin venture capital activity — in dollars — rises in second quarter

Wisconsin startups raised more money in the second quarter of 2024 compared with a year ago, although the number of deals dropped.

Wisconsin startups raised $88.08 million through 21 deals in the quarter, according to the latest quarterly report from PitchBook Data Inc. and the National Venture Capital Association. That compares with $52.49 million across 23 deals in the second quarter of 2023. Figures from 2023 represent adjusted totals.

Nationally, venture capital deal activity rose to $55.6 billion across 3,108 deals in the second quarter, marking the greatest quarterly total since the second quarter of 2022, when funding reached $77.6 billion.

Inflation, elevated interest rates and economic uncertainty continue to dampen venture capital deals globally, but the U.S. is showing positive signs of dealmaking activity in the second quarter, according to initial data from PitchBook and NVCA.

While there’s been an uptick in second quarter dealmaking activity, it may be too early to claim a rebound from the pandemic funding frenzy, according to PitchBook.

The flood of investment in early-stage blockchain, autonomous vehicles, virtual reality and artificial intelligence-related startups has “largely abated,” and now venture capital firms are focused on supporting their most promising companies amid a challenging exit environment.

Despite “high profile” public market debuts of Rubrik and Ibotta, the IPO pipeline has not yet entirely opened up. Only 37 companies have gone public this year with just 14 in the second quarter, according to PitchBook.

“The market likely has bottomed out, and companies that raised two to three years ago and had pushed out financing through cost-cutting measures are returning to the market for subsequent financing,” PitchBook wrote.

Exits prove challenging

There were 31 exits listed in the Q2 report. Exit value is pacing better than both 2022 and 2023, according to PitchBook, though the market still faces its lowest exit total since 2016.

The only metropolitan areas with multiple exits listed for the quarter were Boston, Chicago, New York, San Diego, San Francisco, Seattle and San Jose, California

Nationally, startups led by female founders have been hit especially hard by the slower fundraising environment, raising $15.5 billion across 1,485 deals thus far this year. That compares with $44.9 billion raised in 2023 and $45.7 billion in 2022.

Nizar Tarhuni, vice president of institutional research and editorial at PitchBook, expects the market to continue to be challenging for VC fundraising and startups looking to raise capital, while Bobby Franklin, president and CEO at National Venture Capital Association, has a little rosier take.

"With steadily increasing deal values, especially across early stage investments, more first-time financings, and increased crossover investor participation, Q2 2024 was a good one for VC," Franklin said in a statement with the report.

Here's a look at the Wisconsin startups that raised the most VC funding in the first quarter of 2024.

1. Sift Healthcare

2. Understory

3. Pear Commerce

4. 7Rivers

5. Wisconsin Battery