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Boston Shines Among Venture Capital Markets Struggling in 2023
It's the only big market city in venture with under 20% funding decline in 2023.
Jackson Fordyce
October 27, 2023
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The Story: It’s no secret that venture markets have taken a nosedive since late 2021. Compared to the first nine months of last year, funding is down 52% in the first nine months of 2023.
The startup decline in cities like Durham-Chapel Hill, Miami, and Phoenix has seen funding plummet 80% or more since a year ago, according to Carta.
Source: eShares Inc., dba Carta, Inc.
And it’s not just fringe venture markets feeling the pain in 2023. The Bay Area has seen a 52% drop in capital raised, New York City 54%, and Los Angeles a 58% decline.
But, there is one major venture city in the United States that has proven much more resilient to constricted markets.
Boston has seen only a 19% decline in funding in 2023. Only Washington DC has experienced less decline among major cities, but it received 4x less funding than Boston this year.
In fact, Boston is the only market to have made over $1 billion of investments in Seed & Series A companies AND to have a 20% or smaller funding dip.
The Expert Take: Brian Devaney, principal at Underscore VC, sees Boston playing a major role in the US efforts to recover venture markets. He is proud of the resiliency he sees in Boston startups:
Boston companies are really built strong. They are capital-efficient. We’ve seen this in some of the companies like Klaviyo that have gone public recently… We’re really excited about the resilience of the founders here.
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