Nearly 80% of enterprise funds raised in simply two states as US LPs retreat to the coasts

Venture capital funds within the United States raised extra dry powder within the first three quarters of this 12 months than they did in all of 2021, nevertheless it’s not equally distributed: The large funds hold getting larger whereas fundraising has gotten more durable for almost all of different gamers. And Q3 information reveals that the place a agency relies seems to be taking part in an rising function.

Through the third quarter of 2022, U.S. enterprise corporations raised $150.9 billion throughout 593 funds, in keeping with information compiled by PitchBook. While this represents a lift from the $147.2 billion raised in 2021, it marks a staggering drop from the 1,139 funds closed final 12 months.

Lots of these {dollars} went into legacy or well-established corporations, which have the clout to lift mega-funds, although some corporations drew in {dollars} by garnering hype. Consequently, LPs will not be as fascinated about backing corporations exterior of the established enterprise hubs this 12 months, marking an unlucky reversal to the COVID-induced development of extra enterprise cash making its approach to rising ecosystems.