VC $100M+ Rounds Soar in Q1 2024 as Us Startups Secure 115 Megadeals

Key Takeaways:

There has been a 58% increase in $100M+ venture rounds compared to the same period in 2023.
By mid-May 2024, a total of 115 megadeals have been recorded.
Notable deals have been made across diverse sectors, including gaming, biotech, IT, and food delivery.
Biotech and healthcare sectors are leading in the number of megadeals.
There is potential for 2024 to surpass the total number of megadeals recorded in 2023.

US VC Megadeals Skyrocketed in Q1 2024

The landscape of venture capital in the United States experienced a significant shift in the first quarter of 2024.

With $100M+ venture capital rounds increasing by 58% compared to the same period in 2023, it's evident that investors are showing renewed confidence in high-potential startups across various sectors.

This article delves into the details of this surge, highlighting notable deals, sector leaders, and the implications for the rest of the year.

$100M+ Venture Rounds Are Way Up

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US Venture Capital Megadeals $100M+ in Q1 2023 and Q1 2024, Crunchbase

The early months of 2024 witnessed a remarkable increase in megadeals, with 115 rounds of $100M or more recorded by mid-May. This is a 58% rise from the previous year, indicating a robust appetite for large-scale investments.

This chart from Crunchbase visually represents the growth in megadeals from Q1 2023 to Q1 2024, illustrating the significant upward trend. The surge in these deals is not just a numeric increase but reflects a broader shift in the venture capital landscape where large, late-stage investments are becoming more common.

Notable US Megadeals in Q1 2024 included gaming, biotech, IT, and food delivery.

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The diversity in the sectors receiving these substantial investments is another noteworthy trend. Here are some of the most significant megadeals recorded in Q1 2024:

Epic Games - $1.5B (Gaming)
Xaira Therapeutics - $1B (Biotech)
PsiQuantum - $940M (Information Technology)
Wonder - $700M (Food Delivery)

These deals highlight the wide range of industries attracting significant capital. Epic Games, with its $1.5B round, underscores the continued growth and investment in the gaming industry. Meanwhile, Xaira Therapeutics' $1B round places biotech at the forefront, demonstrating the sector's ongoing innovation and potential.

Biotech and Healthcare led the way

Biotech and healthcare have emerged as leading sectors in the megadeal arena. With 38 of the 115 megadeals in Q1 2024 falling into these categories, it's clear that investors see substantial potential in these fields.

US Venture Capital Megadeals $100M+ by Sector in Q1 2024, Crunchbase

This sectoral breakdown from Crunchbase shows the dominance of biotech and healthcare in securing large investments. Companies like Xaira Therapeutics are leading the charge, with their $1B funding round highlighting the confidence investors have in biotech innovations.

The healthcare sector's strong performance can be attributed to ongoing advancements in medical technology and pharmaceuticals, areas that have seen heightened interest and funding, especially in the post-pandemic world.

Will 2024 megadeals surpass all of 2023?

If the current trend continues, 2024 is on track to surpass the number of megadeals recorded in 2023. By the end of last year, there were 210 rounds of $100 million or more. With 115 such deals already in the first five months of 2024, the industry is poised for a record-breaking year.

Number of US Venture Capital Megadeals in 2023 vs Jan-May 2024, Crunchbase

This Crunchbase chart shows the comparison between the number of megadeals in 2023 and the year-to-date figures for 2024. The sharp increase is a testament to the growing confidence among investors and the maturing startup ecosystem that is capable of handling and justifying such large investments.

"The influx of megadeals this year seems to show investors are again willing to bet big on companies in which they see significant potential. By the end of last year, investors had participated in 210 rounds of $100 million or more. It seems VCs and strategics are well-ready to shoot past that number this year."— Chris Metinko, Sr. Reporter, Crunchbase News

Chris Metinko's insights underscore the shifting dynamics in the venture capital world. The readiness of investors to engage in high-value rounds suggests a renewed optimism and a strategic focus on companies that promise substantial returns.

Are investors becoming more confident in startup returns?

In summary, the surge in $100M+ venture rounds in early 2024 marks a pivotal moment for the U.S. startup ecosystem.

The diversity of sectors receiving these investments, with biotech and healthcare leading the way, reflects a broadening scope of interest and confidence from investors.

The surge in $100M+ venture rounds in early 2024 marks a pivotal moment for the U.S. startup ecosystem.

The diversity of sectors receiving these investments, with biotech and healthcare leading the way, reflects a broadening scope of interest and confidence from investors.

As we move forward, this trend not only promises to surpass previous records but also sets a new benchmark for what high-potential startups can achieve with the right backing.