Q4’19 Venture Pulse Report - Global trends US elections at risk of damaging VC market in 2020

Despite a decline in the number of deals, VC investment globally remained strong in Q4’19. While 2019’s total VC investment fell sharply compared to 2018’s record-shattering $298 billion, VC investment remained significantly higher than all previous years.

The US continued to lead the globe in terms of VC investment during 2019; despite a small dip year-over-year, both the total number of VC deals and the total amount of investment remained very robust. The broadening of the VC market outside of Silicon Valley helped propel the diverse US market, with a number of cities attracting large VC investments during Q4’19. 

For the third straight year, Europe set a new annual record for VC investment. After a record quarter of investment in Q3’19, VC investment remained robust in Q4’19. Countries across Europe saw large investments; in addition to the UK, Germany, and Israel – the Netherlands, France, and Lithuania all attracted at least one $100 million+ deal. The increasing deal sizes speak to the growing maturity of the VC market across the region.

Trends to watch for globally:

Looking ahead to 2020, political and economic uncertainty is expected to remain fairly high in several regions as a result of ongoing Brexit concerns, the continued US-China trade tensions, and more localized challenges in a number of jurisdictions. The November 2020 presidential election in the US could also cause some pullback toward mid-year as investors wait out the election cycle – although the election could also drive an uptick in early year IPOs from companies interested in exiting prior to the election.

Fintech, biotech, and B2B services are expected to remain hot areas of VC investment.

Over the next few quarters, there is also expected to be an increase in interest from VC investors for collaborative economy platforms based around specialized industries – such as RigUp, which provides a platform for recruitment and talent management for oil rigs.