Investor caution towards significant investments in burgeoning startups resulted in a scarcity of mega deals (those valued at $100 Mn or more). In the initial nine months of 2023, a mere 17 such transactions were recorded, a stark contrast to the 68 in 2021 and 53 in 2022. This trend, alongside an intensified focus on profitability, has extended the market correction in the startup sector.
Despite facing challenges, including smaller investments and corporate governance issues, investor confidence in startups has been on the rise in recent months. Securing funding continues to be a daunting task for both investors and founders, but prospects appear to be improving for the upcoming two quarters. There is growing anticipation around more startups making their public debut, a development that could potentially attract additional capital for late-stage companies.
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