The party has paused for venture capital deals in the Seattle area, according to new data from the Seattle-based financial data firm PitchBook Data and the National Venture Capital Association.
PitchBook-NVCA Venture Monitor's first quarter report showed Seattle-area startups landed $700 million across 71 deals in the first three months of 2023. That's far off the pace of last year, when there were 479 venture capital deals worth $7.8 billion in the Seattle area. In 2021, there were 494 deals worth $9.2 billion.
"It would be a mistake to refer to the climate as pessimistic: GDP and employment figures, as well as major stock indexes, were all relatively robust at the end of Q1," the report's executive summary read. "However, the market’s lack of confidence is obvious, and while symptoms of a healthy VC market are clear, the mechanisms of action required to restore it are not as well understood."
Multiple local tech companies have made cuts recently to preserve their bottom lines. Seattle-based real estate tech company Redfin on Tuesday laid off 201 employees in its third round of layoffs in less than a year. Seattle-based travel giant Expedia, meanwhile, laid off employees in March, as did Seattle-based cloud automation company SkyKick.
Still, there were notable funding rounds in the area. Seattle-based agriculture tech company Carbon Robotics raised $30 million on Tuesday. Seattle-based app development company Temporal raised $75 million in February. According to a March report from the IT training organization CompTIA, the Seattle area had the third-highest net gain of tech jobs last year among U.S. metros.
Nationally, PitchBook and the NVCA estimated there were 3,888 venture capital deals worth $37 billion in the first quarter. There were 18,610 deals worth $246.3 billion nationally in 2022 and 18,798 deals worth $346 billion in 2021, which set a record.
The report noted opportunities still exist in venture capital right now.
"More realistic valuations, combined with a market awash in talent and new government programs designed to assist company formation in high-growth strategic industries, are all positive signs," the executive summary read.