CB Insights - unicorn births slow

Hi there,

Our State of Venture Q1’22 Report is out.

Download 300+ pages of data on deals, valuations, multiples, exits, and more here.

And now, here is this week in charts.

Billion-dollar startups. Unicorn births slowed in Q1’22 compared to Q4’21, coinciding with a 19% decline in funding QoQ. However, the number of new unicorns in Q1’22 was still more than triple 2020’s quarterly average. The US and Europe accounted for the majority of new unicorns in the quarter.

When I dip, you dip, we dip. SPACs are seeing increasingly high rates of share redemption, where investors pull money out of deals before the merger is complete. In the first 2 months of 2022, the average redemption rate for a SPAC merger reached 80% — meaning 4 out of 5 shares were redeemed before the target company was acquired — up from about 50% in 2021 and just 20% in 2020, according to Dealogic. This can put a huge dent in the amount of capital a company can raise in the offering. Added to high sponsor and transaction fees, some companies have dropped their SPAC deals altogether.

The 9-to-10. Knowledge workers typically experience two productivity peaks in a workday (before lunch and after lunch). But as the pandemic sent workers home, some saw a third peak before bedtime, according to a study of Microsoft employees. This “triple peak day” highlights the benefits of remote work flexibility (think for parents with small children) but also the perils of being “always on” in WFH (burnout, anyone?). 

Code green. More hospitals are acting like VCs as they look to diversify revenue streams and get in on the digital health boom. The venture arms of large health systems — like Kaiser Permanente Ventures and UPMC Enterprises — ramped up activity in 2020 and 2021, according to CB Insights data. Focus areas include hospital-at-home technology, medical devices, and back-end administrative tools.

More cheese, please. The “pizza principle” — first conjectured in 1980 — dictates that a slice of NYC cheese pizza will always be the same price as a subway fare. But no more. The average cost of a plain slice has topped $3, while MTA fares have been frozen at $2.75. Tech also has its own “pizza” law known as Amazon’s “two-pizza rule” — or why teams small enough to be fed by 2 pizzas are more likely to be successful. Dig into this law and 7 others driving success in tech here.

A space odyssey. Paging Elon Musk — the FRED features “interplanetary data.” 
 

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