2024 VC Deal Data in Review
Fewer - but larger - Series As.
We posted every Series A deal that was announced in 2024. Now, let’s look back on a full year of venture data and updates on the landscape.
First, the overall trend for deal volume, versus 2023:
Series A: -4.9% decline (1,619 → 1,554)
Series B: +9.1% growth (761 → 832)
Series C: +17.2% growth (291 → 342)
Growth for Series Bs and Cs can likely be explained by the continued rebound in public markets, given their closer proximity to exit expectations and the fact that they took a much bigger hit vs As in 2022. For Series As, we would’ve expected Series A volume to grow last year, given AI, but we might be looking at the new normal.
The question we’re constantly asking at Magid is where does deal appetite come from? In post-seed early stage funding (As and Bs), we’ve consistently said that “there is no magic number or market benchmark” where As happen. Yet, funds are still somewhat limited by check sizes and partners’ capacity to take board seats.
Fund capacity is one indicator. Last year, we saw traditional growth funds slow down and multi-stage venture funds size up. General Catalyst ($8B), a16z ($7.25B), Thrive ($5B), Norwest ($3B), Spark ($2.3B) raised the biggest funds, whereas Tiger raised $2.2B (63% below their $6B target, vs $12.7B for their last fund) and Insight is targeting $12.5B for their new fund closing in Q1 (vs $20B in 2022).
Bigger funds have to deploy more capital. That either comes from more rounds, or larger rounds. We believe funds are leading larger rounds, rather than stepping up round volume. It’s unclear to the outsider investor or founder how the risk/reward for a $250M Series A or even B is underwritten, yet the mega-rounds for compute-intensive AI businesses made up a significant proportion of early stage capital deployed in 2024 — e.g. Safe Superintelligence, Physical Intelligence, Mistral, Skild, Poolside, Figure, World Labs. The number of mega-As ($100M+, excluding life sciences) jumped from 8 in 2023 to 18 last year!
Of course, it’s the mega-funds who are leading these mega-rounds. Smaller (<$500M) early stage funds are not writing lead checks into $100M rounds, but even as round volume fell slightly, the median round size has jumped significantly—for Series As, $15M from $12M in 2023, and for Series Bs, $32.3M from $26.6M in 2023. Increasingly, funds have to be flexible on their “standard” check sizes and ownership targets in order to win hot deals. There are no hard rules in early stage investing.
Today’s prevailing narrative in fund fundraising is that LP dollars are flowing primarily to the brand names and mega-funds, in the “flight to quality.” Yet, a few $100M+ funds entered the seed and A arena last year—Laude Ventures ($150M), Chemistry ($350M), Marathon ($500M), Alt Capital ($150M), Saga Ventures ($125M). Led by seasoned GPs and operators hunting for more reasonable deals, rather than the mega-rounds, these debut funds may provide more options for founders this year.
Fund Activity Analysis
We ranked the top 20 funds by Rounds Led and Capital Deployed, for Series As.
Based on our selected sample of 15 “brand name” investors, we found that their deal volume has significantly increased over the last year, relative to the rest of the market. The data would seem to validate what we’re all seeing in the market—that a specific set of funds are aggressively competing and backing horses in the AI race.
Series A financings (2023 to 2024):
Total rounds: 1,619 to 1,554 (-4.9%)
Rounds led by our 15 investor sample: 109 to 139 (+27.5%)
Series B financings (2023 to 2024):
Total rounds: 761 to 832 (+9.1%)
Rounds led by our 15 investor sample: 59 to 66 (+11.9%)
Series C financings (2023 to 2024):
Total rounds: 291 to 342 (+17.2%)
Rounds led by our 15 investor sample: 18 to 32 (+77.8%)
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Disclosures
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