Since 2021, it appears the venture gambit has not been working out. Hundreds of startups hoped to be worth billions on paper and exit in good order, but that year turned out to be more of an outlier than an indicator of a new normal.
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There seems to be a general downward trend in the value of American startups when compared to 2021. This is most apparent in the amount of money that these companies are able to fetch when they are sold or go public. So far in Q1 2023, there have been relatively few M&A and IPOs of private tech companies, which puts the total value at just under $2 billion. If this trend continues, it could mean big trouble for the U.S.’s struggling tech sector.
As seen in the graph, startup exits have been on the rise in America over the last few years. This is most evident in 2012-2013 when there were a total of 128 venture-backed exits. In contrast, there were only 98 venture-backed startup exits between 2016 and 2017. This increase may be due to a number of factors including an increase in investment dollars being funneled into startups, as well as an increase in the number of high-profile exit deals. So far this year, there have been an additional 25 venture-backed startup exits already, demonstrating that this upward trend is