![The recent tech IPOs are flirting with negative territory | TechCrunch](https://hycys04.com/wp-content/uploads/2023/09/The-recent-tech-IPOs-are-flirting-with-negative-territory.jpg)
SaaS follow-on rounds see a slowdown, but it won’t last forever | TechCrunch
![](https://techcrunch.com/wp-content/uploads/2023/07/GettyImages-1400003953.jpg?w=625)
Global venture funding has been rather gloomy as of late, with data from Crunchbase showing that investments fell in Q3 despite a late-stage rebound led by large AI deals.
And the story’s no different for SaaS startups.
In May, net new SaaS sales came down from a spike in Q1 while churn worsened, spurred by reduced business-to-business budgets and higher borrowing costs. At the same time, extension rounds — an important indicator of a sector’s overall health — declined.
PitchBook data compiled for TechCrunch shows that U.S. VC follow-on activity in SaaS dropped from a high of $9.7 billion across 270 deals in March to a low of $1.5 billion across 131 deals in October. The decrease in deal count has been consistent: Each month since June, the total number of SaaS follow-on deals has dipped by around 10 to 40 deals month-to-month.
The caveat is that total SaaS extension deal value has been holding steady at between $1.5 billion and $2.9 billion from April to October. But that simply indicates that a smaller cohort of startups has been securing disproportionately larger extension rounds.
More Stories
Silicon Valley shaken as open-source AI models Llama 3.1 and Mistral Large 2 match industry leaders
[ad_1] Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More...
Crypto AI Token RENDER Soars 15.6% After Rebrand, Can It Hit $10?
[ad_1] Today, the Render Network finalized its RENDER crypto AI token migration and upgrade. Following the highly anticipated rebrand, the...
Grok chatbot trains on X user data in ‘very likely’ breach of EU law
[ad_1] Elon Musk could have yet another problem with the European Union. Musk’s X has enabled the Grok chatbot to...
Bitcoin Supply Drop Signals Bullish Price Movement, Analyst Says
[ad_1] After its latest halving event, Bitcoin sent a positive signal throughout the crypto market. Historically, this big drop in...
Paris Olympics app ‘prime target for cybercriminals’
[ad_1] The Paris Olympics 2024 kicked off today. But as the City of Light opens its gates to millions of...
AI training costs are growing exponentially — IBM says quantum computing could be a solution
[ad_1] Earlier this month, the Wall Street Journal reported that a third of nuclear power plants are in talks with...