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The pace at which startups raise rounds worth $100 million or greater is slowing, according to early data.

Looking at historical periods stretching back a year, TC’s analysis of Pitchbook data shows Q2 2022 is on pace to undershoot the first quarter’s tally of so-called mega-rounds. And data from Crunchbase shows a similar decline.

When you consider that Q1 2022 saw fewer rounds worth $100 million or more than both the final two quarters of 2021, we’re seeing a slowdown in late-stage, private-market investment.

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It’s not a shock that the there are fewer large venture capital rounds happening. Indeed, we anticipated it, given the retrenchment we’ve seen in software valuations more generally, and the fact that the risk climate for private-market dealmaking has become more conservative in recent months. A massive public-market selloff coupled with geopolitical instability and inflation concerns will do that.

While the late-stage venture capital market is becoming more staid, the crypto world is seeing immense deals that are raising hundreds of millions of dollars. The contrast is notable. Let’s talk about it.

It’s still a good time to raise huge rounds

What makes it hard to grok the changing venture capital market is the fact that we’re coming off all-time highs. So while the data indicates that there were between 100 and 132 venture rounds worth $100 million or more (PitchBook and Crunchbase data, respectively) thus far in Q2 2022, we have to understand that there is still a lot of money flowing today compared to historical norms, even if the numbers represent a near-term decline.

Looking behind, it seems clear that 2021 will prove a high-water mark for venture capital activity for some time. There’s little indication that 2022 will be able to beat last year’s tally, and with economic clouds on the horizon, anyone betting that 2023 is going to be straight up lit is wagering against prevailing wisdom.