On-demand webinar

Has the music stopped? Venture capital in the new macro environment

Has the music stopped? Venture capital in the new macro environment

Several challenges emerged for the venture capital ecosystem in 2022, and chief among them was inflation and the Fed’s response to it. As higher-for-longer interest rates, geopolitical, and economic headwinds deflated public market equity values, the private markets looked insulated on paper—but questions about markdowns, down rounds, and the availability of capital are now leaving investors and founders wondering what lies ahead.

That uncertainty has culminated into the sudden demise of Silicon Valley Bank, which briefly left the VC community fearful of a market collapse until the federal government stepped in. As the dust settles on the first quarter of 2023, we are taking a deeper look at how these recent developments will shape the coming year. In this webinar, PitchBook analysts reviewed the macroeconomic landscape and its impacts on VC.

Key takeaways include

  • Tough financial market conditions have caused our estimate for the IPO backlog to soar to record levels. Our analysis of public comps suggests the window is still closed for most unicorns.
  • A record $42.8 billion of unmet demand for new capital could result in further layoffs and structured financing to extend runways.
  • Our VC Dealmaking Indicator suggests a much more investor-friendly environment this year compared to 2022. We explore what that means for company valuations and VC returns.

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Zane Carmean headshot Zane Carmean, CFA, CAIA
Lead Analyst, Quantitative and Funds Research, PitchBook

Zane Carmean is a quantitative research analyst at PitchBook, where he conducts data analysis, creates financial models, and authors research reports and thematic analyst notes covering private markets. Carmean helped launch PitchBook’s Quantitative Perspectives series, a new report style that provides a fully quantitatively-driven narrative of the current and future states of private markets. In addition, he helped build PitchBook’s proprietary valuation models to analyze the GP stakes market as well as cash flow forecasting tools to assist allocators in estimating future cash flow and commitment pacing needs. Carmean also helps build new capabilities for clients to leverage PitchBook data sets.

Prior to PitchBook, he was a senior associate at Green Street Advisors, where he conducted the research and analytics behind many of the firm’s strategic research reports in the commercial real estate industry. Carmean received bachelor’s degrees in finance and economics from Loyola University Chicago and a master’s degree in finance from Bocconi University in Milan. He is also a CFA charterholder and CAIA charterholder. He is based in PitchBook’s Seattle office.

Alex Warfel headshot Alex Warfel, CFA
Quantitative Research Analyst, PitchBook

Alex Warfel is a data analyst on the quantitative research team at PitchBook, where he contributes to data-driven research and timely analysis of the global private markets. Warfel also develops tools for the PitchBook Platform, including PitchBook’s VC Dealmaking Indicator, which estimates the fundraising environment for early- and late-stage financings. Prior to joining PitchBook, he was a business intelligence developer at IPC Global and an associate analyst at Coventry.

Warfel received his bachelor’s degree in business administration and finance with a minor in math from the Marist College School of Management. He is also a CFA charterholder. He is based in PitchBook’s Seattle office.

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