The State of U.S. Early-Stage Venture & Startups: 3Q23
Early-stage venture performance provided cause for optimism in 3Q23.
Oct 18, 2023 — 2 min read
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- 3Q23 early-stage venture performance trended in a positive direction, providing founders reason for cautious optimism after several quarters of negative growth.
- Of particular note was a sharp increase in investment activity rate, signaling a greater willingness by VCs to re-enter the market.
- This increase in investor demand was reflected in median valuations, which trended upward in 3Q23 amongst startups that raised a round.
- Founders responded to the livelier fundraising environment with increased spend in 3Q23. Much of this spend was concentrated around marketing and AI tools.
- Read all our findings in our 3Q23 State of U.S. Early-Stage Venture & Startups report, produced in collaboration with Ramp.
For the first time in awhile, early-stage venture performance (which AngelList defines as activity rate and positive activity rate) trended in a positive direction in 3Q23. Activity rate, in particular, returned to levels more in-line with historical norms, while positive activity (i.e., markups), increased modestly—likely due to the increase in investor demand.
This increase in investor demand was reflected in the median valuations of startups that raised on AngelList in 3Q23, which increased across most stages after several quarters of decline. Our data also revealed an unprecedented level of demand for AI / ML startups in 3Q23. Investments into these startups are likely responsible for many of the positive performance trends we observed in 3Q23.
