Q4’21 Venture Pulse Report - Americas

Megadeals continued to drive a significant proportion of VC investment in the Americas during Q4’21 — particularly in the US, which saw a $1.8 billion investment in Commonwealth Fusion, a $1.5 billion investment in Gopuff, a $1.4 billion raise by Sierra Space, a $1.3 billion raise by Lacework, and a $1 billion raise by Thrasio, in addition to $500 million+ funding rounds by a breadth of companies including DriveWealth, Hinge Health, Nuro, Uber Freight, and others. While the presence of large megadeals has been a consistent trend throughout 2021, the Americas also saw the number of first-time financings and their associated deal value reach new records during the year.

Following 3 very robust quarters of investment, VC investors in Canada took a bit of a pause in Q4’21, taking more time to assess and complete due diligence on potential deals. This, combined with a typical lull in deal activity over the winter holiday period likely accounted for the drop in VC investment during the quarter. Increasing concerns around the Omicron variant, supply chain issues, and inflation may also have also caused some distraction in the Canadian VC market.

AI remained a very hot sector for investment in Canada, helped by the country’s strong AI ecosystem including its talent base, education institutions, and array of startups. The broad applicability of AI solutions across sectors will likely keep AI-focused investment in Canada strong headed into 2022. Healthtech and fintech also remained strong areas of investment in Canada during Q4’21.

The VC market in Latin America is evolving rapidly, with a growing number of startups raising larger funding rounds. The maturation of companies is readily apparent in the number of companies reaching unicorn status and the speed at which some are doing so. During Q4’21, Latin America accounted for four new unicorns: logistics company CargoX and SMB e-commerce enabler Olist in Brazil and e-commerce aggregator Merama and corporate credit focused fintech Clara in Mexico. 

The Americas is expected to see robust VC investment heading into Q1’22. While the US is expected to remain the dominant VC market in the region, other jurisdictions within the Americas — particularly in Latin America — will increasingly see strong and globally competitive companies emerge.