CB Insights - VC falls

Hi there,

Here is this week in charts.

Get low. The venture slowdown is in full force. Global deal activity is down 23% from Q1 to Q2 (as of June 23) this year, after staying mostly flat in the previous quarter. Funding is also set to drop more than we predicted mid-way through the quarter, as investors shy away from big, late-stage checks (Series D+).

Turn off the lights. Bitcoin’s energy use has dropped by more than a third over the last few weeks, according to recent estimates. As the value of BTC has taken a nosedive, price levels have dipped to a point where miners' electricity costs could exceed what they can earn from mining new tokens — leading some miners to press pause on their less efficient machines. Need a refresher on how Bitcoin works? Check out our explainer here.

In the trenches. The biotech sector is facing a major cash crunch. Listed biotechs have seen their value fall over 70% from their peak in 2021 as investors seek out less risky sectors, hampering these companies’ ability to raise new funds. With markets in turmoil, only 9 drug companies have gone public in the US this year compared to almost 60 over the same period last year — cutting off another key source of capital. Early-stage biotechs that must fund long development cycles are particularly exposed. Private fundraising, meanwhile, has also begun to dry up.

They work hard for the money. The teens are back to work. Facing labor shortages, US businesses hired almost 1M more teens in summer 2021 compared to summer 2020. But today’s teen summer employment levels remain far below ye old days (pre-2000), when over half of US youths spent part of their summer working.

Under the mattress. Americans have a lot of cash on hand. At the end of Q1’20, US households held $13.7T in cash and cash equivalents. By the end of Q1’22, that number was up to $17.9T. Even after adjusting for inflation and looking across wealth, income, and other demographic lines, this increase in cash holds. While recession warnings are all the rage, Americans’ savings cushion could blunt the impact of a downturn. 

The people sure do love Boris. So many readers sent this to us we had to feature. [This is just a bad bar chart — it’s not a political opinion.]
 

I love you.

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